The most obvious is the global markets are in a bearish correction. The U.S. began this correction near the middle of October when there were signs of several sectors and major indices topping out. The rallies leading the market to these high-valuations was led by Tech. Tech is the dominate factor in the market and are the heaviest weighted across the indices, sectors, and investment portfolios. Institutional Money has been rotating out of Tech into other sectors (safety havens) like utilities, consumer staples.
As for $WMT, it rose ~19% since the earning report in August and is currently ~10% off it's recent high at the close of yesterday), which is better than most companies can say. The next support level for $WMT is the $90.00 area, should the selloff and retail sector continue to be under pressure.
The economy is booming; however, it you look at the past few months you'll see/hear a lot about companies buying back stock. In fact, buybacks have increased dramatically. These buybacks are misleading the growth of the companies and their earnings. Conclusion, the earnings and growth cannot sustain (buybacks eventually catch up to the market and growth valuations). Sooner or later, the companies cannot continue to meet the expectations of wall street. We began to see this when the Tech sector started missing earnings.
To add fuel to the fire, I've been watching the correlations between the strong U.S. Dollar and 10-Year Treasury against the major markets and fear gauge. When the $ and Treasury rise the latter falls. This is also relevant to the interest rate discussion, which continues to rise and is hurting the housing market (builders) sector.
In conclusion. The U.S. Market is not just driven on how successful the economy looks on paper. There are many global dependencies that feed into the market. I wouldn't look at this as a Rep/Dem discussion. For me, I only depend on what the technical's are doing across all sectors of the U.S. Market and understanding how the Asia, UK, markets are behaving, which ultimately has an impact on the U.S. Futures. Those then drip-down into sectors and individual stocks. If the individual stocks (like Apple) carry a huge weight - their behavior can have a significant impact to the broader market. Keep an eye on Tech! I do expect retail to turn-around, but it's going to be a 4th Quarter shopping event.
Always have a trading plan in place. Avoid the noise on the boards and focus on protecting capital and following your trading plan.
