I'm very tired of writing about the fiscal cliff but there really is no choice. As the action today proves, it is the only thing that matters to this market. It sold off sharply this morning when Sen. Harry Reid said it was nearly impossible to do a fiscal-cliff deal this year, and then bounced very sharply when Speaker John Boehner scheduled the House to reconvene on Jan. 30 and a meeting with President Obama and key leaders was arranged. Suddenly the market went from despair to hope.
It was a very impressive intraday reversal but, overall, the indices didn't have much to show for it. They ended up with minor losses and breadth was about 2400 gainers to 3050 decliners. Of course, it was downright ugly about 2:30 p.m. EST when it looked like the politicians had given up.
The good news, or maybe bad news, is that we get to do it again tomorrow. The only thing that will matter, again, is any news or rumors about a fiscal-cliff deal. Normally, we would be talking about end-of-the-year window dressing, tax selling and positioning for the new year, but that takes a backseat to the fiscal cliff.
If you like playing slot machines, you are likely to enjoy the action tomorrow. Have a good evening. I'll see you in the morning.