And Just Like That, The Market Rally Is Gone

thenews 2013.06.21 17:30

After two huge stock market sell-offs, some traders were speculating that we could see a "dead cat bounce" today.

But so far, the bounce has been pretty unremarkable.

After trading up 100 points at the open, the Dow has lost all of its gains. All three major stock market benchmarks have gone into the red.

Recent volatility in the markets appeared to be triggered on Wednesday afternoon when Federal Reserve Chairman Ben Bernanke suggested that the Fed could soon begin to taper, or gradually reduce, its extraordinary stimulative bond-buying program, aka quantitative easing.

For those who missed it, here are Bernanke's exact words:

"Going forward, the economic outcomes that the Committee sees as most likely involve continuing gains in labor markets, supported by moderate growth that picks up over the next several quarters as the near-term restraint from fiscal policy and other headwinds diminishes. We also see inflation moving back toward our 2 percent objective over time. If the incoming data are broadly consistent with this forecast, the Committee currently anticipates that it would be appropriate to moderate the monthly pace of purchases later this year; and if the subsequent data remain broadly aligned with our current expectations for the economy, we would continue to reduce the pace of purchases in measured steps through the first half of next year, ending purchases around midyear."