a 4%-5% pullback further from here

oldpigwang

We're Back to a Macro-Driven Market

By Jim Cramer
RealMoney Columnist
1/20/2010 12:06 PM EST
China trumps American politics. How else can we view a day where the most important earnings are positive and the market gets hammered anyway? We have a total macro day today where companies that have virtually nothing to do with foreign business - retail -- are getting crushed. And I don't mean just because of Coach (COH - commentary - Trade Now).
The colossal selloff in the Nasdaq is what is most disturbing to me. The numbers of the companies that have reported in the group to date are incredibly good, but the run-ups have been severe -- witness IBM (IBM - commentary - Trade Now) -- and we are getting terrible reactions to them. And even a Cree (CREE - commentary - Trade Now), up 8, has zero pin-action.
To me, today is one of those days when the "it is overextended" and "it is overbought" are coming home to roost, and while we can repeal the election win, if we finish much below that we are going to be back in a world where people feel that we get a new recession off any Chinese slowdown.

I am not willing to consider this more than the sell-the-news judgment of Doug Kass. Too early. But the pain of the Nasdaq's move after a 44% run last year says to me that we could drop from being flat for the year,
where we are, to a 4%-5% pullback further from here unless Google (GOOG - commentary - Trade Now) and Microsoft (MSFT - commentary - Trade Now) deliver pristine results.

Ugly day. But not yet an ugly trend.

intral