Unexpected Stock Buyback Halts Are The Market's Latest Red Flag

One of bigger reasons for this week's market weakness was the previously discussed start of buyback blackout period.

As a reminder, weeks of aggressive buyback flows on Goldman's trading desk, which last week finished 1.5x vs 2021 FY ADTV (with flows skewed toward Consumer Discretionary, Tech, and Communication Services) ended with a whimper on Dec 19 as many companies entered their blackout period. According to Goldman, Monday was the start of the final blackout window of the year with ~33% currently in their closed window, and by tomorrow a majority, or ~54% of the S&P 500, will be in blackout (buybacks flows within less aggressive 10b5-1 plans remain).