Dimon and Rust

The market was hanging in yesterday until Jamie Dimon spoke in the afternoon and told us all that business was worse than he expected. (Was he talking his book?) This morning the futures are way down on news that the oxidizing US auto business is not getting a bailout - at least not yet.

The chart of the S&P shows how the 50 MA stopped the advancing action. Before hitting the 50MA, the market had advanced 20% off its recent low. The futures this morning are giving back less than 50% of that. For the S&P, a 50% give back is 830. The question going forward is how much pain and misery is priced into the market. Will bad news on the auto front drive the market to new lows.