Vikram Saxena

Friday Outlook: Watching Paint Dry

I think instead of window dressing, we are seeing window breaking (as termed by Art Cashin on CNBC). Hedge funds are massively short the market and want their shorts to go back further before the quarter end. The rumors about LEH/ML seem to strengthen the thesis, that there are some significant money trying to get the some high profile under performing stocks to go down further.

So the securities under pressure in the second half of this week might see more pressure on Monday and then rally into the rest of the week as the hedgies rush to reduce their short exposure.

After the big up day earlier this week, the market listlessly drifted down with very little conviction in any direction. This is really an odd behavior and suggests that the traditional window-dressing is being supplemented by sometime more, and newer.