"You can't really have a healthy market without healthy financials," a key bellwether sector that represents more than a quarter of the S&Ps 500's market capitalization, said Anthony Conroy, head trader at BNY ConvergEx Group, a New York brokerage. "People are still waiting for the last shoe to drop."
Financial firms stand at the center of the US economy. They supply credit to the business and consumer sectors in large degrees. If these companies are not functioning well, then the rest of the economy experiences problems.
The financial sector is hurting big time. Notice the following on the chart:
-- Prices are below the 200 day SMA
-- Prices are below all the SMAs
-- The shorter SMAs are below the longer SMAs
-- All the SMAs are headed lower
-- Yesterday be had a big volume sell-off that took us to new lows.
Short version: this sector is far from healthy right now.
