Financial stocks rebounded from last week's losses on stronger
retail sales yesterday, but it was not enough to keep the broad
market from a loss. After a round of buying that at one point had
the Dow up by over 70 points, weak manufacturing data and a strong
U.S. dollar resulted in steady selling that continued for the
U.S. retail sales rose 1.2% in October.
Ford Motor Company
) rose 4.3% to $17, its highest price since January 2004.
) rose 2%,
) gained 1.5%, and
) was up 1%.
The Federal Reserve Bank of New York's Empire State
Manufacturing Survey was expected to come in at 11.7 for November,
but instead reported a loss of 11.1. And a bigger-than-expected
increase in inventories in September could leave companies holding
too much inventory if the holiday shopping season disappoints.
In corporate news,
) fell 1.2% on its announced acquisition of
Isilon Systems, Inc.
) for $2.25 billion.
BHP Billiton Ltd.
) abandoned its bid for
Potash Corp. of Saskatchewan, Inc.
), and the stock rose 0.8%.
Lowe's Companies Inc.
) fell 1.1% after reporting that its fiscal Q3 earnings rose, but
that sales fell more than expected, and it lowered its earnings
forecast for the year.
Treasuries fell, driving the benchmark 10-year note up to 2.95%
- its highest yield since August. The dollar rose to its strongest
level against the euro since late September. The euro closed at
$1.3569, down from $1.3693 late Friday.
At the close, the Dow Jones Industrial Average was up 9 points
at 11,202, the S&P 500 was off 2 points at 1,198, and the
Nasdaq fell 4 points to 2,514. The NYSE traded 877 million shares
with decliners over advancers by 1.2-to-1. The Nasdaq exchanged 526
million shares with advancers over decliners by 1.2-to-1.
Crude oil for December delivery fell 2 cents to $84.86 a barrel,
following the mixed U.S. economic figures. The
Energy Select Sector SPDR
) dropped 32 cents, closing at $62.62. December gold rose $3 to
$1,368.50 an ounce. But gold prices were held back by the stronger
PHLX Gold/Silver Sector Index
) fell 3.26 points to 212.84.
What the Markets Are Saying
Yesterday's close, which cracked the 1,200 support line of the
S&P 500, may prove significant. But for the second day, the
S&P 500 found support at its 20-day moving average, now at
1,195. Curiously, the low of each day corresponded almost exactly
with this slightly rising moving average, and yesterday's close,
which was less than 3 points above it, makes the 20-day the
dominant near-term feature on the chart rather than the round
number of 1,200.
Since the high of Nov. 5, the S&P 500 has closed lower in
five of the past six sessions, forming a tight channel down on
diminishing volume. Normally following so many days down on low
volume, we would expect a rebound, and we may still get one, but
not before the immediate support at 1,195 is penetrated and the
bottom of the current broad support zone at 1,174 is tested.
Barring a break through 1,195 on high volume, the bulls are
still in charge, but yesterday's two-hour straight line sell-off
leaves them more vulnerable than at any time in the past two
For one stock with a strong chart, see the
Trade of the Day
Today's Trading Landscape
To see a list of the companies reporting earnings today,
For a list of this week's economic reports due out,
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