The markets looked modestly weak at the outset this morning, but from about 11 am ET on, the market just continued to deteriorate with the most damage occurring after 1:30 pm ET. But the good news (stretching a little) is that the markets managed to recover some of the losses, so they didn't close at the lows of the day, as they did last Thursday. SPX lost $19 to close at $1920 and RUT closed down $3 at $1122. Since RUT has been trading much weaker than SPX for the past few months, perhaps today's stronger performance in RUT is another positive sign. The VIX tacked on almost two points to close at 16.7%. This level of volatility still strikes me as relatively low if we are really on the verge of collapse, as some would suggest.

Trading volume popped back up today with 2.2 billion shares of the S&P 500 stocks trading. Volume rose 15% on the NYSE and increased 14% on NASDAQ.

Factory orders for June came in 1% higher, an improvement from May's 0.6% decline. The ISM services Index reported out at 58.7 for July, up from 56.0. Before the market opened, several reporters said analysts were watching for the ISM number to see if the market would stabilize. Apparently, the improved ISM number wasn't enough. Some observers conjecture that increased tensions in the Ukraine were behind the afternoon weakness.

Today's close on SPX represents a pull back of 3.4% from the recent highs. This places us in the neighborhood of the April 4% pull back, but a little over half of February's 5.7% pull back. Since we seem to be struggling for an explanation of this spell of market weakness, I am inclined to think we will see a weaker pull back, but we'll see. If someone starts shooting down planes again...