Monday Market Conditions 8/13/12 $SPX $SPY $VIX $VXX

Following last week's low-volume snooze-fest, we learned that Japanese growth slowed to 1.4% annually.  Also of note is that Japan voted to double their sales tax over the next three years to help fight their growing debt.  When a similar course was taken in 1997, it had the effect of stalling out their economic recovery.

More data is surfacing which continues to suggest that China is continuing to slow.  Chinese export growth fell to just 1%, missing forecasts of 5%.

The market had its first red day in about a week and a half, though the bears didn't have much of a bite, and again it came on super light volume.  Lots of important data coming out this week (Retail sales, PPI, inventories, CPI, unemployment), so I fully expect that to change starting tomorrow.

Volatility continues to nosedive, even with the market down today.  Closing in on the lows from March.

While indicators on the S&P 500 chart remain overbought, the McClellan Oscillator is anything but.  And the percent of stocks above their 50-day moving averages remains at the highs of the year.  The CBOE put/call ratio has actually started to creep back up, meaning investors have 1) begun buying puts to protect their positions and/or 2) buying puts/closing calls in anticipation of a pullback.

-Tech continues to surge thanks to AAPL & GOOG.  Wonder where we would be right now without these two names.
-Financials seem to have leveled off a bit.
-The Energy sector remains strong.
-After a small bounce, Materials look to be headed back down.

-Small caps continue to under-perform the larger market.  Can't have your generals and admirals leading you into battle without the privates and ensigns.
-Utilities have given a little back but are now in step with the S&P.
-Industrials have started to pick up a little life.  These tend to lag major market moves.
-Transports are in a nosedive.  Bad news if you subscribe to Dow Theory.