Despite a new eurozone agreement that gives Greece another bailout, investors seemed unimpressed with the deal. And even an easing of bank lending requirements by China failed to attract buyers. The Dow Jones Industrial Average penetrated above 13,000 several times but failed to close above it causing several technical analysts to make negative comments about the lack of momentum in the market.
At the close, the Dow gained 16 points at 12,966, the S&P 500 gained 1 point at 1,362, and the Nasdaq fell 3 points to 2,950. The NYSE traded 798 million shares and the Nasdaq crossed 471 million. Breadth was even on the Big Board, but there were more decliners than advancers on the Nasdaq by a ratio of 1.7-to-1.
Yesterday the stock market turned flat despite the news that investors had been looking forward to for months — a settlement of the Greek debt crisis. The good news fromEuropewas treated with a resounding “ho-hum” instead of a strong round of buying.
Since the December low and reversal, the Nasdaq has been the leading index. But there are few examples of charts that show a steep-angled trendline as sharp as this that continue much longer than this — over 31 days without a correction.
Last week was full of good economic and corporate news, and the market responded favorably. The Empire State Manufacturing Index, new housing starts and retail sales were up, the Philadelphia Fed’s Business Outlook Survey improved, and there was another sharp decline in unemployment claims to the lowest level since March 2008.
And yet, with all of the good news, followed by a settlement of a problem that has dogged the markets for months, stocks did nothing. In other words, good news was treated badly. Our regular readers will recognize this as one of the clearest signals that the market has run out of gas. And speaking of gas, crude oil surged to a nine-month high and, yes, gas is headed to $5 per gallon.
Additionally, other commodities had sharp advances including gold, silver and other metals. Is the piper about to be paid for the unrelenting wash of Fed money poured into the economy? We’ll discuss this further tomorrow.
Today’s Trading Landscape
To see a list of the companies reporting earnings today, click here.
For a list of this week’s economic reports due out, click here.