Worries Spread From Greece To The PIGS

The market is a funny thing. Yesterday the market rallied as it ignored the problems bubbling in Europe. Today the worry is back on the front burner, as yields in Greece spike higher, and the markets in Spain, Portugal, Ireland, etc. take a hit on fears that they could run into similar problems like Greece.

There were some more positive economic reports this morning. Factor orders were surprisingly strong at +1.3%, and pending home sales for March rose +5.3%. But that data is obviously being ignored at the moment.

Ditto the positive earnings reports from today for the likes of Merck (MRK), Pfizer (PFE), and MasterCard (MA).

The flight-to-safety trade appears to be in effect, as investors rush to safe havens like Treasuries. The price of the T-note is up today, pushing the yield down to 3.62%. Also, the new safe haven trade appears to be gold, which topped $1192 earlier.

The dollar is also at fresh 11-month highs, which is weighing on most commodities. Oil prices are down 1.8% near $84.50.

Among the sector ETFs, energy is down the most (-3.2%), followed by industrials (-2.9%). Healthcare is down the least (-0.55%). Among the industry etfs, homebuilders are down -3.38%, and emerging market etfs are being hit particularly hard.

Asian markets were also lower overnight; and the VIX is spiking +21% today to 24.43, taking out last weeks highs.

Trading comment: Today is one of those days where you wish you simply didn't own anything, although I do have a couple of stocks on my screen that are bucking the weakness so far. Visa (V) is up, and my recent pick GMCR is flat.

Yesterday I mentioned that the market rallying back up to resistance at its 20-day might not last. And right on cue the markets are back in correction mode. The next stop on the charts is the 50-day averages, which stand around 1169 for the S&P 500 and 2404 for the Nasdaq.

It hasn't been easy to hold all this cash lately, but it feels better on a day like today. The goal is to have a cash cushion during the decline to make it easier to ride it out, and also to have ample buying power to take advantage of the pullback and add to positions at lower levels.

long GMCR, V