After having advanced for nine out of the past 12 sessions and the NASDAQ having reached record highs 37 times this year, the equity markets are taking a well-deserved rest. Today, the DOW dropped 47 points, the S&P 500 lost 6 points, and the NASDAQ fell 20 points.

Breadth numbers were negative at a 10/18 downside ratio and the VIX was higher at 10.45 for a gain of .38. Treasury yields were lower on the ostensible geopolitical concerns. The 10-year Note was down to 2.14%, the lowest since last November.

Other safe havens like gold continued on the rise to $1,296 an ounce…the highest level in seven months. Crude oil bounced around above the $48 a barrel level and closed at $48.35. The dollar was weaker again with the Euro up to 112.72 while the Japanese yen was down to 109.47 to the dollar. All three “safe havens” – bonds, gold and the yen did well again.

The S&P 500 now trades at around 18.5 times estimated earnings for 2017 and 16.6 times estimated earnings of $146 for 2018.  The average P/E multiple for the S&P going back to 1954 has been 16.4 and it has been 14.4 over the last 10 years.

Donald M. Selkin

These are excerpts from Don Selkin’s Daily Market Notes, abbreviated and updated with permission from the author. Don Selkin is the Chief Market Strategist at Newbridge Securities Corporation, member FINRA/SIPC and provides the Fair Value analysis for CNBC each morning.  The commentary provided in this Market Letter is intended to provide timely market analysis and should not be considered a research report.  This Market Letter may contain, and is limited to: Discussions of broad based indices; Commentaries on economic, political or market conditions; Technical analyses concerning the demand and supply for a sector, index or industry based in trading volume and price; Statistical summaries of multiple companies’ financial data, including listings of current ratings; and, Recommendations regarding increasing or decreasing holdings in particular industries or securities.  This Market Letter does not make a financial or investment recommendation or otherwise promotes a product or service of the firm.  This Market Letter contains only news, facts, and commentary on information previously reported from a news source believed to be accurate and reliable by the author.  These news sources include the following: Bloomberg Financial, Reuters, and the Associated Press.