On Monday, the Dow industrials managed to hold on to a small gain and record a new record high. And the Nasdaq jumped above 4,000 for the first time in 13 years but couldn’t retain it at the close.
The emphasis of light institutional buying was focused on the blue chips with Wal-Mart (WMT) getting most of the attention. The world’s largest retailer gained 0.8% after making a new intraday high but couldn’t hold the new high at the close. Most traders attributed the sluggish trading to a traditionally low-volume day in a holiday week, and they expect volume to remain light throughout the Thanksgiving week.
Social media stocks were hit with losses with Facebook (FB) off 3.1%, Yelp (YELP) down 6.7%, and Twitter (TWTR) sliding 4.7%. Their losses were attributed to profit-taking.
At Monday’s close, the Dow Jones Industrial Average gained 8 points to 16,073, the S&P 500 fell 2 points to 1,802, and the Nasdaq rose 3 points to 3,995. The NYSE primary market traded 625 million shares with total volume of 2.9 billion shares, and the Nasdaq traded total volume of 1.8 billion shares.
The Nasdaq made a new 13-year intraday high but failed to hold above the round number of 4,000. However, support is close at hand at 3,966, and its MACD is within a fraction of a new buy signal.
Several commentators made much of the S&P 500 hanging at the top of its Bollinger Bands. But new highs are generally made hugging the upper Band. When prices fall from the upper band, it is time to be concerned.
Conclusion: The worrywarts were out in droves again Monday. Those who have not participated in this, the greatest bull market in years, just can’t accept the fact the stocks are still headed north without them, and so they continue to pass on their justifications for not being invested.
They continue to miss the major reason for the bull market — the Fed’s determination to follow an easy-money policy and continue injecting capital into the markets. Those who fight the Fed and the major market trend will continue to miss out on the greatest opportunity to make money in stocks in decades.
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.