Choppiness defined

When I wrote only yesterday that we should expect a choppy market through year-end, I had no idea that today would prove to be such a great example.

The trading day began with a U.S. productivity report that was very positive and stocks responded as one might typically expect with such a good economic report. By around 3:00 est the Dow was up 101 points and the S&P 500 had risen eleven. Then the computerized sell programs kicked in and investors followed giving up nearly all the the day's gains. The Dow finished up 21.85 and the S&P 500 up only 1.61.

And while many positive economic reports can be interpreted as inflationary, positive productivity reports are much different. Productivity is total output divided by hours worked, so a strong number implies that inflation is pretty much in check. The same number of workers are producing more goods in the same amount of time. But after a few hours to digest the info, the market sold off anyway.

Expect more of the same as the month winds down.