The Correction Begins

US Markets and Index ETFs corrected into positive territory today, as to be expected after last week’s painful declines.  The SPDR S&P 500 ETF (NYSEARCA:SPY) gained 1.72%, the SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA) gained 1.22%, the PowerShares QQQ Trust Series 1 ETF (NASDAQ:QQQ) added 2.80%, and the iShares Russell 2000 Index ETF (NYSEARCA:IWM) added 2.35%.

Despite all of the negative and flat our frightening news coming out of Greece and Europe lately, markets rebounded yesterday, likely in a correction move from oversold levels. Last week after all turned out to be the worst week for Wall Street so far for 2012, so it is natural that a slight rebound occurred yesterday, especially with no new news regarding the euro dollar or Greece.

Speaking of the eurozone and ailing euro dollar, Spanish bond yields hit 6.29% yesterday, a small bit of news compared to the looming fact that Greece may indeed go rogue and wreck the financial system as we know it. China seems worried about its slowing 8% growth rate as well, as the country announced Sunday its intentions to prioritize “stabilizing growth;” this comment led to rumors about a Chinese stimulus program in the works. All I can say is that we really must be in trouble if a country with nearly 8% growth rates feels the need to “stimulate.”  Perhaps the writing is on the wall for all of us.

The writing may also be on the wall for Facebook (NASDAQ:FB), which took a 11.46% drop yesterday to close at $33.00, well below its initial offering price. The Facebook IPO has been a complete flop so far, so one may wonder if indeed Facebook missed the boat as well.

Bottom Line:  Markets corrected yesterday after a heavy week of losses last week. One must remain skeptical and cautious however, as many chances of a “Lehman” event(s) occurring still lie ahead.

Disclaimer: Wall Street Sector Selector trades a wide variety of ETFs and positions can change at any time.