The traders returned from their holiday and volume shot back up to normal, but the mood turned gloomy after both the World Bank and the International Monetary Fund (IMF) forecast a slowing global economy. SPX dropped $14 to close at $1441 and RUT closed at $828, down $10. Trading volume on the S&P 500 increased from Monday's anemic levels, but just hit the 50 dma at 2.4 billion shares. Trading on the NYSE was up 37% and trading on NASDAQ increased 39% on the lows on Monday. Volatility edged up a little over one point to 16.4%; this is still a reasonably low volatility number, so traders have not hit the panic button as yet.

Alcoa kicked off the earnings season with a better than expected report, but warned that the coming quarters will be impacted by the slowing of China's economy. Rioting in Greece continues and the IMF predicts that the Greek debt will reach 171% of GDP this year and increase to 182% next year. The IMF report states that the target of the bailout of 120% of GDP will be almost impossible to reach by 2020. I cannot understand how it is that the plight of Greece and Spain has not registered on us here in the states.

My Oct condor is now under pressure again with recent market weakness; the P/L stands at -$340 with delta = +$101 and theta = +$127. The Nov position stands at a P/L of +$700 with delta = +$26 and theta = +$66.