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Stocks Bounce from Lows; Can Small Caps Lead Summertime Rally?

By Schaeffer's Investment Research July 05, 2012, 04:35:29 PM EDT

"Even though there was a variety of news out there this morning, today was about as unexciting of a day that we've had in a long time," remarked Schaeffer's Senior Technical Strategist Ryan Detrick. "There was one bright spot, though, as it was very nice to see housing up, while financials -- especially JPMorgan Chase -- got hit hard." With that, the Dow Jones Industrial Average (DJI) tumbled this morning, and spent the remainder of the day attempting to regain its footing.

Click through to see what else was on our radar today:

  • Will small caps lead the summertime surge in the broader market?
  • The retail sector shrugged off weak same-store sales , but why?
  • Plus, Bernie Schaeffer examined the new high in ProShares UltraShort S&P500 (SDS) call open interest .
And now, a look at the numbers...

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

The Dow Jones Industrial Average (DJI - 12,896.67) spent about an hour in positive territory this afternoon, but was unable to keep its head above breakeven. By the time the dust settled, the Dow was off 47.2 points, or 0.4%, finding a foothold above its session low of 12,852.24. All but seven of the 30 blue chips settled with losses, as JPMorgan Chase ( JPM ) paced the underperforming issues with a 4.2% drop. Home Depot ( HD ) led the winning minority with a 0.9% rise.

The S&P 500 Index (SPX - 1,367.58) followed a similar path, and tripped 6.4 points, or 0.5%, at the close. Meanwhile, the Nasdaq Composite (COMP - 2,976.12) closed fractionally higher. At their intraday worsts, the SPX and COMP traded at 1,363.02 and 2,958.30, respectively.

The CBOE Market Volatility Index (VIX - 17.50) moved 5% higher today, but landed below its session peak of 18.22.

Today's highlight : "Bottom line: today was a coffee day," smiled Detrick. "Coffee days occur when nothing much happens and you'd be better off just going for coffee all day. But stay tuned, as tomorrow should provide for some early volatility with the jobs data due out before the bell."

Turning to today's major market stories...

For today's activity in commodities, options, and more, head to page 2.

Following Tuesday's rally , oil futures took a dip today on a stronger greenback -- thanks to interest rate cuts from Chinese and European central banks -- and weak same-store sales in the retail space. Despite a decrease in oil stockpiles, the dollar-denominated commodity fizzled. In a low-volume session, August-dated crude declined 44 cents, or 0.5%, to land at $87.22 a barrel.

In similarly low-volume action, gold futures took a slight hit as the dollar soared on stimulus announcements from world central banks. By the close, gold for August delivery inched $12.40, or 0.8%, lower to settle at $1,609.40 an ounce.

Levels to watch in trading...

  • Dow Jones Industrial Average (DJI - 12,896.67) - support at 11,500; resistance at 14,000
  • S&P 500 Index (SPX - 1,367.58) - support at 1,100; resistance at 1,500
  • Nasdaq Composite (COMP - 2,976.12) - support at 2,400; resistance at 3,400

OUTPERFORMING AND UNDERPERFORMING SECTORS

STOCKS - MOVERS

STOCKS - EARNINGS

STOCKS - NOTABLE CALL ACTIVITY

STOCKS - NOTABLE PUT ACTIVITY

Click the links for coverage on today's notable annual highs and notable annual lows .

SCHAEFFER'S MARKET POSTURE

At the end of every market day, the staff at Schaeffer's Investment Research reviews the trading day in detail, covering major events and key market developments. Don't miss this critical, timely and insightful report. If you enjoyed today's edition of Market Recap, sign up here for free daily delivery straight to your inbox.




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Options

Referenced Stocks: CTRP, HD, JPM, QIHU, TJX



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