On Wednesday stocks paused, with mixed trading results, prior to a major release of economic data and a policy statement from the Bank of England.
The recent surge in volatility had been associated with a decline in the price of crude oil … however, crude fell again yesterday but, as noted, stocks were mixed. Energy stocks fell 1.1% and crude oil fell 2.9% to $43.58 per barrel.
The technology sector gained 0.6%, led by Apple Inc. (NASDAQ:AAPL), which rose 3.6%. Apple’s gain occurred following investors’ interest in the new iPhone series. Apple’s success apparently prompted other manufacturers to shortly issue their own new smart-phones.
Skyworks Solutions Inc (NASDAQ:SWKS), recommended as a Trade Of The Day at $65 on July 28, led the gainers on the S&P 500 with a jump of 4.38% at $72.40. Apple was the second-highest performer of the day.
At the close the Dow Jones Industrial Average fell 32 points at 18,035, the S&P 500 fell a point to 2,126, the Nasdaq gained 19 at 5,174, and the Russell 2000 closed down a point to 1,212. The NYSE’s primary exchange traded 904 million shares with total volume of 3.6 billion shares, and Nasdaq crossed 1.9 billion shares. On the Big Board and the Nasdaq, decliners slightly outpaced advancers. On the NYSE blocks fell to 4,930 from 6,120 on Tuesday.
The exchange-traded fund SPDR S&P MidCap 400 ETF (NYSEARCA:MDY) violated its June closing high on much-higher-than-normal volume. But so far it is the only index to do so. MACD is oversold and there is a strong band of support starting at 271.
Conclusion: There is some minor technical damage as a result of what appears to be a normal pullback following August’s new highs. But a solid consolidation, above the immediate support line for the major indices, would provide confidence that September/October will be a prelude to a post-election breakout.
My longer-term outlook is still bullish. However, the near-term is shaky, and if the June closing highs of the Dow (18,011), S&P 500 (2,119) and Nasdaq (4,975) were to be violated, the intermediate trend would go negative, too.
There is a lot of data to be released in the next seven days. The market’s reaction to it could chart the course through the remainder of the year.
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.
