The anticlimax that has marked the last week of 2010 trading held serve on Thursday.
As we noted after Wednesday’s closing bell, the S&P 500 had traded within a 2.4% range since Dec. 13. Turning the screws even tighter this week, the index hasn’t budged outside of a 0.8% channel.
A similar pattern emerged on Thursday that was seen the day before: stocks drifting higher in the afternoon only to sell off before the closing bell, as traders looked to do most of their heavy lifting near the end of the session. The difference was, on Wednesday the indices posted a slim gain, while on Thursday the slight tumble insured a loss for the day.
And that’s about as much as investors can read into the movement of stocks this week.
The Dow Jones Industrial Average closed at 11,570, down 16 points, while the Nasdaq and S&P 500 notched almost identical falls, on a point-percentage basis.
The strength seen on Wednesday in financial names and precious metals was not present Thursday: the Financial Select Sector SPDR (NYSE:XLF) exchange-traded fund dipped 0.4% while gold and silver both fell — hardly a concern with the metals up 28% and 81% for the year, respectively.
A selloff in oil to under $90 a barrel similarly kept a lid on most commodity prices. Sugar, in particular, fell dramatically. The iPath DJ-UBS Sugar Subindex ETN (NYSE:SGG) dropped nearly 10%.
Bonds were little changed — the 10-year yield inched back up to 3.37%.
A rare point of interest Thursday was in the rare earth metals sector. Related stocks and ETFs have caught a bid this week following news that China intended to institute export quotas on its global shipments.
After a leap out of the gates after Tuesday’s opening session, traders quickly pounced on one of the few industries to offer the opportunity for something close to a significant profit this week. The Market Vectors Rare Earth/Strategic Metals (NYSE:REMX) ETF has jumped more than 13% since Tuesday’s opening bell — and tacked on another 3% on Thursday.
However, as pointed out in a trading floor note early Thursday by Briefing.com, traders weren’t content to merely bid up the proven, high-quality names in the space. Anything that looked close to a rare earth or resource play, particularly those with a China presence, benefitted from momentum money looking for a home.
As a result, anonymous penny stocks, such as China GengSheng Minerals (AMEX:CHGS) and Tri-Valley Corp. (AMEX:TIV) saw explosions of trading volume. Shares of Tri-Valley, for example, had 7.3 million shares change hands — a tad above its average daily volume of 170 thousand.
For those investors planning a day in front of their terminals on New Year’s Eve (all U.S. markets are open for full sessions), there is at least the possibility of watching that spectacle play out.
