This Stock Market is Really Sick, and Big Institutional Investors are Bailing out…”They’re slashing their equity allocations: BlackRock.

Tuesday, January 26, 2016
By Paul Martin

by Wolf Richter
WolfStreet.com
January 25, 2016

Stocks can’t seem to rally for more than two days in a row before getting hammered down again, punishing dip-buyers with relentless regularity for doing what had worked flawlessly for years.

Today’s swoon — S&P 500 and Nasdaq down 1.6%, Dow down 1.3% — put an end to the short-covering rally that started midday Wednesday, when the S&P 500 bounced off 1,812 and then rose 5.3% by late Friday. Draghi had given the buy signal.

“By the end of the week, weary investors had returned to an old habit: looking to central banks for solace,” wrote BlackRock Global Chief Investment Strategist Russ Koesterich, Monday morning before it all fell apart again.

But despite the vague promises embedded in Draghi-speak, it didn’t last long. Overall, it was a puny rally compared to the brutal selloff that had started at the end of December. The S&P 500, at 1,877, is now back exactly where it had been on March 10, 2014. Despite all the drama and volatility, it has gone nowhere in nearly two years — not counting anguish, fees, and taxes.

Large institutional investors are starting to figure this out too. And they’re planning to bail out of this cursed market.

The Rest…HERE

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