Stocks Blasted on Ebola, Illiquidity, Fed Exit and Weak Data

Stocks started under heavy selling pressure Wednesday amid Ebola fears, weak economic data, illiquidity and this month's ultimate Fed exit of QE. However, the market has bounced off the morning lows.

The Dow is down 160 points after trading down over 360 point earlier to the lowest levels seen since last February. The S&P 500 is down 21 points after earlier erasing all its gains for 2014. 10-year treasuries fell below 2% for the first time since May 2013.

Today, Texas Health Presbyterian Hospital announced a second healthcare worker has tested positive for Ebola. The worker was said to have provided care for Thomas E. Duncan, the first person in the U.S. diagnosed with the virus. Duncan passed away last week.

Meanwhile, retail sales fell 0.3% in September versus an expected 0.1% drop. The October 2014 Empire State Manufacturing Survey was reported at 6.17 versus an expected reading of 20.25, signaling that the pace of growth slowed significantly from last month. Lastly, PPI was reported at -0.1% versus an expected +0.1%.

Many traders noted illiquidity in a number of stocks as volume has dried up and moves are exaggerated.

Also this month the Fed will likely announce and end to its monthly bond buying program, or QE. The Fed has been tappering its buying from as high as $85 billion a month to this month's $15 billion. The October Fed meeting will likely see the FOMC announce the end of the program. Rate hikes are expected in 2015.

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