Today's trading started out pretty weak as SPX fell to $1397 by mid-morning. But the last two hours of trading were another story: SPX recovered most of its losses to close at $1405, down $2 on the day. RUT had a similar intraday pattern, but its afternoon recovery did not falter at all. RUT gained $10 to close at $822. But RUT continues to trade below its May highs while SPX has traded back down to its May highs. Trading volume was mixed, but roughly flat from Friday with 2.1 billion shares of the S&P 500 stocks trading; trading volume on the NYSE was down 6%, but trading on NASDAQ was up 10%. VIX bumped up about half a point to 18%.

The ISM manufacturing index report was released for August at 49.6, down from the previous month. This is the third month of manufacturing contraction and is the lowest reading of this index since July of 2009. Construction spending dropped by 0.9% in August, after a 0.4% increase in July.

It almost seemed as though the negative economic data encouraged the bulls that Bernanke was going to unveil QE III at next week's FOMC meeting.

My Sept iron condor is standing at a P/L of -$800 with delta = -$152 and theta = +$154. Today's strong run by RUT squeezed this position once again. The October condor position stands at a net gain of $440 with delta = -$42 and theta = +$86.

I hope you enjoyed your Labor Day weekend. Now it's back to work... but remember to be thankful for a job. It's tough out there.