Daily Market Update -January 20, 2016 (7:30 AM)

Yesterday was just another in a series of nothing but disappointments in 2016.

What looked like it might be a good gain for the day, with the market following oil decidedly higher, turned into wasting a 200 point gain as oil decided to turn lower.

While the DJIA closed up slightly higher, it was clear that it wasn’t done following the path of oil, which has had nothing to make anyone think that it was going to head higher anytime soon.

With Iranian oil now coming on line and no one looking as if they’re going to cut back on production, there is really going to be a glut of the stuff and no one’s economy is stepping in to use the cheap stuff as an excuse to ramp up anything.

This morning, as oil is again down sharply, it’s not too surprising that the market is continuing in the same path.

This morning, the futures are down nearly 300 points and just adding more misery to what 2016 has already been for most everyone.

Yesterday’s turnaround was pretty stunning. It’s getting hard to envision what, besides a sustained increase in the price of oil could lead to an equally sustained move higher in US stock markets.

With China still continuing to be a mess and with no one really knowing what the depth of that mess really is and with some of the belief that our own market could have another 10% downside ahead of it and could be a harbinger for some layoffs, you really have to wonder what the FOMC is thinking and what they will do, if anything.

While most came to the realization that having an interest rate increase would be a good thing, as it would have reflected the need to gently tap the brakes on a growing economy, now comes the realization that maybe the FOMC should have waited for some real tangible evidence of that growth.

With market psyches so fragile, it’s not to certain that they could then see an FOMC action to again reduce rates as anything but really bad news for the economy and therefore for company earnings and stock valuations.

Most people, even those who may be value hunters haven’t been biting at stocks at these lower price levels.

Yesterday was another good example of why it has been a mistake to do so as the market was headed higher. Those climbs have been very transitory for the past 2 months and have only led to more disappointment except for those who may have been very, very short term oriented,

The moves have been on a dime, as yesterday showed and even when thinking that a new position was in the clear, all it has taken is to turn away from the screen for a few minutes and to see that optimism get replaced by gloom.

That’s not a very healthy market and it seems so bizarre to want to see the price of oil climb higher and to want to see interest rates do the same.

When was the last time you lived in a world like that?