U.S. equities mostly moved lower on Tuesday as investors were spooked by a horrific suicide bombing in Brussels that drove interest toward safe haven assets.
The first explosions took place at the Brussels airport, followed by a blast at a metro station. Reports said more than 30 people were killed and over 100 injured in the attack. ISIS has claimed responsibility.
Equity markets responded with the Dow Jones Industrial Average losing 0.2%, the S&P 500 falling 0.1%, the Nasdaq Composite wafting up a modest 0.3% and the Russell 2000 finishing the bleak day 0.1% lower.
Treasury bonds weakened after an earlier rally was reversed, the dollar mostly strengthened, gold gained 0.3% and crude oil lost 0.2% to close at $41.43 a barrel.
Healthcare stocks led the way with a 0.9% gain, followed by technology, which rose 0.1% as a group. Wynn Resorts, Limited (NASDAQ:WYNN) gained 2.4% after enjoying an upgrade from analysts at Morgan Stanley. Consumer staples lagged behind the crowd, down 0.8%. Oil services firm Transocean LTD (NYSE:RIG) dropped 5% after its CEO told Bloomberg the company will have to wait at least another three years before it can start charging higher rates for offshore drilling rigs.
Nike Inc (NYSE:NKE) dropped more than 2% in after-hours trading after reporting better-than-expected earnings, but weak revenues weighed down by currency moves and warehousing costs.
On the economic front, the flash Markit factory PMI activity report showed U.S. manufacturers remain in “go slow” mode with survey participants blaming the contentious presidential election, among other factors, as being responsible for the tepid results.
And finally, there was some more hawkish Federal Reserve commentary with Chicago Fed President Charles Evans saying the economic fundamentals are “really quite good” and that higher interest rates are needed soon.
Technically, stocks continue to look vulnerable here with breadth eroding and major resistance levels just overhead. There were 200 net declining issues on the New York Stock Exchange today, well below the high of near 2,000 set last week and continuing a pattern, shown above, of narrowing buying interest.
For now, I continue to recommend conservative investors move to cash while the more aggressive focus on short-side opportunities such as Netflix, Inc. (NASDAQ:NFLX), which is contending with resistance at the $100-a-share level. I have recommended the $95 NFLX puts to my Edge Pro subscribers.
Anthony Mirhaydari is founder of the Edge and Edge Pro investment advisory newsletters. A two-week and four-week free trial offer has been extended to InvestorPlace readers.
