Can someone please reset the algo?
Yesterday I talked about how there are ETFs that mimic the way momentum managers think so you do not need to buy a whole bunch of stocks. It's autopilot investing.
Today it is all about selling the stock market when oil goes down because, once again, we have an old linkage: if oil is going down then the economies around the world are weakening so we should sell all stocks except the Colgates (CL) and the PepsiCos (PEP) . And that's exactly what's happening.
It would be nice if the people behind this claptrap recognize that as pipes come on in the U.S. to transfer hitherto trapped Permian oil to the market, we have enough oil to produce more than 12 million barrels today making us the world's largest oil producer. Sure the world is slowing. That's not new from me although it would be new to Fed Chief Jay Powell.
But, the algos and the morons who run them don't think that granularly. So we end up with what we have: oil down, sell S&P 500 futures and buy consumer packaged goods staples at the same time. I would say take advantage of it and do some buying but the algos will not let up and I expect the market to get thin as the day goes on.