With the losses Friday and today, we are roughly back to the lows of last Wednesday. Today's markets opened even lower, but then recovered to minimize today's losses. SPX closed at $2084, down $10 and RUT closed down $4 at $1261. Volatility popped up today about two points with the VIX closing at 15.4%. Trading volume increased on the S&P 500 stocks to 1.8 billion shares, but this remains below the 50 dma. Trading increased 7% on the NYSE and trading volume on the NASDAQ increased 24%.

 

If you read the financial web sites today or listened to the analysts on CNBC and Bloomberg, everyone blames the current market weakness on concerns about Greece defaulting on its sovereign debt. But this potential issue has been brewing and well publicized for several years. If Greece defaults, the only people hurt outside of Greece will be the speculators who have bought the bonds in hopes of a settlement; they are yielding about 24% at this point.

 

Another reason for the market to be soft is the upcoming FOMC announcement Wednesday afternoon; traders are waiting for news on the timing of the Fed raising interest rates.

The Empire manufacturing survey reported  -2.0 for June, down from +3.1 in May. Industrial production decreased 0.2% in May, slightly better than the -0.5% in April. Capacity utilization  remains basically flat with a 78.1% report in May, only slightly different from April's 78.3%. Housing starts and building permits report tomorrow and the FOMC announcement is scheduled for Wednesday afternoon. Thursday brings the CPI and the Philadelphia Fed manufacturing survey.

I doubt we will see much happen in the markets until after the Fed announcement.