Stocks Start ‘Sleeper’ Week by Slipping

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Investors were cautious Monday following last week’s major gains. With Q3 earnings drawing to a close and typically low holiday volume, there was little to move the markets in either direction.

Attention continued to be focused on a probable increase in interest rates by the Federal Reserve. Thus, October’s larger-than-expected 3.4% fall in existing home sales was greeted favorably. The Fed could use this report to say conditions are not yet “right” for a rate increase. Bad news, in this sense, is good for stocks.

Europe is still in an economic decline, and the minutes from the ECB’s latest meeting indicated they were gearing up for more stimulus. Terrorist attacks in France and a subsequent massive manhunt in Brussels has fixed the attention of European markets recently. The Stoxx Europe 600 fell 0.4% on Monday.

Oil lost 0.4% at $41.75 a barrel. Gold fell 0.9% with a final fix at $1,066 an ounce. And the euro hit a new low for the year, down 0.1% against the U.S. dollar at $1.0637.

At Monday’s close, the Dow Jones Industrial Average fell 31 points at 17,793, the S&P 500 dropped 3 points to 2,087, the Nasdaq was off 2 points at 5,102, and the Russell 2000 rose 5 points to 1,180.

The NYSE Composite’s primary exchange traded 863 million shares with total volume of 3.5 billion. The Nasdaq crossed 3.9 billion shares. On the Big Board, there were slightly more advancers than decliners, and on the Nasdaq, advancers led by 1.3-to-1. Block trades on the Big Board fell to 6,188 versus Friday’s total of 6,270.

S&P 500 Chart
Click to Enlarge

Chart Key

The chart of the S&P 500 shows stocks are having a difficult time making big moves against a supply of potential sellers.

Much of the selling was wiped out in the August and September sell-offs. But selling volume was only very high on the August correction.

Support is just below Monday’s low at a narrow band from 2,050 to 2,080, with the 200-day moving average at 2,065.

Conclusion

Barring any unusual global events, this week looks like it will be a sleeper. The intermediate- and near-term trends are up. But the bulls have yet to prove they can hold up under what is bound to be year-end profit-taking.

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.


Article printed from InvestorPlace Media, https://investorplace.com/2015/11/daily-market-outlook-stocks-start-sleeper-week-by-slipping/.

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