As things typically happen in threes, this held true for the markets as the Nasdaq Composite fell for a third straight session, closing off?47.97 points (1.2%), to 4,079.75 on Monday. This now has the index declining under its 100-day moving average and over the last three trading days, it has fallen 4.7%–its biggest three-day losing streak since November 2011.
The?S&P 500?(SPX) closed the day down?20.05 points (1.1%) to close at 1,845.04, under the “key technical level” of 1,850 while the?Dow Jones Industrial Average?(DJIA?) fell 166.84 points (1.3%) to end the day at 16,245.87.?
Also jumping in the fall was small-company stocks as the Russell 2000 stock index was off 1.2% to 1140.
Meanwhile, the VIX closed at 15.57, up 1.61 (11.53%).This comes after it hit a low point last week on Friday at the 12.60 mark–a first since January, reported the Wall Street Journal’s Chris Dietrich.
Looking ahead to this week, the March FOMC meeting notes are on everyone’s minds (released on Wednesday) while some market professionals are pointing to momentum stocks spurring the sell off as they have been overpriced and trading at false levels.
Clifford Noreen, president of Babson Capital, said via CNBC, “I tend to look at the fundamentals. They’re almost like cult stocks that had a really high amount of momentum in them and once they go the other way, the fast money sells out. That’s what was happening in this group of stocks.”
Noreen sees continued selling and added,?”If there was a material correction going on, you’d see a crack in credit spreads. We haven’t seen that. It’s been very solid. You also have margin selling,. Margin debt was at record levels. It’s healthy to have that flushed out, and that’s probably what’s going on.”
Adding some fuel to the market fire this week is the kickoff of first quarter earnings. On tap for this week is Alcoa (Tuesday) as well as?JPMorgan?and?Wells Fargo?(Friday).