Although the market is in the midst of breaking out with the Dow Jones Industrial Average and S&P 500 hitting all-time highs, Wall Street is becoming antsy and wants to share those feelings with everyone else.

Recent comments and actions were akin to screaming 'Fire' in a crowded theater.

"The world economy is like an ocean liner without lifeboats. If another recession hits, it could be a truly titanic struggle for policymakers." -Stephen King, HSBC

“Investors remain trapped in “The Twilight Zone,” the transition period between the end of QE and the first rate hike by the Fed, the start of policy normalization.” -A note from Bank of America.

Yesterday morning, Goldman Sachs downgraded 19 stocks while upgrading only 9 stocks. It wasn't the only firm in the mood to lower its ratings on a myriad of stocks, either. The question for me is why? I honestly do not think HSBC, Bank of America, or Goldman Sachs has told their institutional investors to sell everything and head for the hills.

So, why are they inciting such action on Main Street?

I guess the market has rallied for so long without a real or even a minor hiccup that it’s been an easy soapbox to climb. The scores of bears have been wrong for years and still claim they're making money.  (Yes, they're long, even though they've warned you to stay out for 12,000 Dow points.) Let fundamentals and market action speak to you more than the masters of the universe who share their fears.

Apparently, the very same masters are having a tough time keeping up with the Jones, Smiths, and Robertsons, etc. Many hedge funds are folding tents and others are trying to find complex ways to make money. Check out all the factors that now go into the quant witches’ brew. It doesn't have to be this complicated, but I suspect that's how you keep getting millions to manage even as you underperform.

Today’s Session

The pulse of Main Street, as measured by retail sales and the housing market, are once again sending mixed messages, but the same mixed messages.

Wal-Mart lays an egg as overall revenues were slightly lower as total revenue in the US came in better than total international revenue, however, it was still disappointing. The company saw US revenue of $70.2 billion which is up 3.5% year-over-year, but operating income of $4.6 billion, a decrease of 6.8% year-over-year and operating margin contracted to 6.6% from 7.3%. I suspect the moral of this story is that cheap is ubiquitous and somehow the company has to find ways to boost traffic and sales.

Home Depot on the other hand had a dream quarter, driven by what management is calling a "stronger than expected spring." Same store sales +7.1% as revenues of $20.89 billion were a 6.1% improvement.  Additional metrics:

• Average ticket $58.60 from $57.59, +1.8%
• Number of transactions 360.2 from 344.5, +4.6%
• Sales per square feet $353.70 from $334.01, +5.9%

The moral of the story is we love our homes and want to spruce them up.

Speaking of homes, housing permits and starts both came in above consensus this morning.

• April Starts 1,143,000 (annualized); consensus 1,065,000
• April Permits 1,135,000; consensus 1,019,000

Ironically, the strong data from the housing sector spooked the market with renewed rate hike jitters.  More important to me as results at TJ Max which beat on the top and bottom lines and upped guidance.  Be that as it may, the street just has no clue how to handle the first rate hike. On one hand, selling to avoid a short-term dip will look really dumb and the vast majority of money managers have underperformed so much in recent years that this isn't the time to look like a rookie.

Then again, preserving slim gains could make the average money manager look like a superstar at the end of the year. This has become a game of inches.