The markets had their second down day in 2015; the S&P 500 hovered near 2,000 on Tuesday, while the Dow Jones industrial average moved under 17,500 — largely in response to the further weakening in oil prices and soft economic data.
“What’s new is that you’ve had the Fed, [the European Central Bank President Mario] Draghi and the Bank of Japan coming in — constantly, consistently and getting the market to be happier, getting the market to say everything will be fine,” said Quincy Krosby, market strategist at Prudential Financial (PRU), on the TV show “Bloomberg Surveillance” Tuesday.
Asked if that continues to be the case this week, Krosby said, “Obviously not.”
“Once you have a quick plunge in any commodity, in any asset, and it will bleed over’ it will correlate over” to other parts of the market,” she explained.
The dramatic plunge in oil prices over the past few months is having an impact, the analyst believes.
“There’s the economy, and then there’s the stock market, right, and we’re see a bleeding into the market,” Krosby said.
As for the economy, “The question is: How many layoffs are we going to have in Texas … in North Dakota? In fact, the numbers are not that astounding. When you do the … the equation, it’s actually better overall for the U.S. economy,” she explained.