As quickly as the recovery effort materialized on Monday, it faded on Tuesday, well short of the key hurdle the bulls needed to clear to reignite the bigger-picture rally. On the other hand, it’s not like the bears did any real damage either. The S&P 500 finished yesterday’s action squarely between support and resistance, still waiting for traders to muster some conviction.
On Tuesday, the S&P 500 lost 6.82 points, or 0.29%, to close at 2,342.19. Not every sector got hit. Noncyclicals/consumer staples were up 0.59% for the session, led by the 24.7% gain GNC Holdings Inc (NYSE:GNC) mustered following a nice earnings beat.
That wasn’t enough to offset everything else though. In fact, every other group was in the red. Healthcare stocks led the bearish charge with its 0.93% setback. Johnson & Johnson (NYSE:JNJ) was out in front of that parade with its 3.1% tumble. J&J’s first-quarter revenue shortfall made it an easy target.
Steady (albeit not thrilling) capacity utilization and industrial productivity numbers for March weren’t enough to stave off the selling. Investors were just too concerned about a handful of earnings disappointments, presuming they were an omen of what to expect for the rest of earnings season.
Although the market’s back wasn’t broken, the undertow was a little more bearish than it superficially seemed on Tuesday … at least for the NYSE. For the Big Board, 61% of its volume was selling, and 37% of its trading volume was bullish. Decliners outpaced advancers at a rate of 50%/46% (meaning 5% of the NYSE’s issues were stagnant for the day).
The Nasdaq’s internals were even more balanced, at least in terms of volume. For that sliver of stocks, 49% of the volume was down, and 49% of it was up. There were considerably more falling stocks than rising stocks on the Nasdaq though. Decliners outpaced advancers at a rate of 1.3 to 1.0. The Nasdaq Composite ended the day at 5,849.47, down 7.32 points, or 0.12% lower.
In all cases, however, Tuesday’s total volume was greater than Monday’s volume, when stocks were on the rise. The bears are slightly more interested in selling then the bulls are in buying. The bears are hardly in firm control though.