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Thursday, October 1, 2009

We're Not in Kansas Anymore, Toto

The Yellow Brick Road has taken a hairpin turn over the past two trading days, and not in the direction of the Emerald City.

 The long-awaited correction got underway with a vengeance today, with broad-based selling from open to close. The $VIX spiked, the dollar firmed, and nearly everything equities-related couldn't get dumped fast enough. Bearish economic data out before the open got credit for the swoon, but the top-heavy market didn't need much encouragement to beat a retreat as it entered the often volatile month of October.

 The Dow slid 2.09%, the Nasdaq lost just over 3%, and the S&P 500 dropped 2.58% to close at 1029.85. Market internals were exceedingly negative, with higher than average turnover accompanying the sell-off. There is some significant support near the closing levels where at least a technical bounce may develop soon.  -- Brinkley

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