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A colleague noted that he had discovered exactly what’s been behind the August market volatility when the long bond yield hit 6.66 percent Friday afternoon.
Many of us have been having a devil of a time finding rhyme and reason in the wide swings of the popular averages, particularly the unprecedented five straight sessions of triple-digit moves by the Dow Jones industrial average, not to mention the 100-point-plus recovery in the last 15 minutes of trading Friday to give it a small loss for the session and a gain of 193 points for the week.
A Dow gain or loss of 100 points represents a move of only a little more than 1 percent, but the human brain apparently sends out nervous signals at the sight of three digits.
