Indexes fell modestly, but the story Tuesday was how retail and energy helped counter a wave of selling in the technology sector.
[ibd-display-video id=3046275 width=50 float=left autostart=true] The Nasdaq fell 0.3% while the S&P 500 and Dow Jones industrial average lost less than 0.1%. Volume fell and likely will be light the rest of the week, as it commonly is between Christmas and New Year's Day.
News that analysts are cooling their expectations about the new iPhone X rattled Apple ( AAPL ) and its sphere of influence. Bloomberg reported that some analysts cut iPhone X shipment forecasts for the January-March period for Apple's prized smartphone.
Apple shares fell 2.5% and are now testing the 50-day moving average . If the stock can bounce from the line, it would give Apple a chance to resume its advance. But it would not be a new buy area unless the stock climbs back above its 176.34 buy point. The breakout Dec. 18 was suspicious to begin with because volume was lackluster.
Chips were among the lowest groups. Qorvo ( QRVO ) and Skyworks Solutions ( SWKS ) were some of the Apple suppliers that fell noticeably. Qorvo lost 2.6% and Skyworks 1.9%. Both already had been trending lower for weeks.
But the Nasdaq's weakness was not confined to high tech. The solar energy group fell 1.5% and also contributed.
Small caps fared better, with the Russell 2000 adding 0.1% despite broad weakness in the financial sector. Money center, regional and superregional bank industry groups fell 0.4% to 1.1% on the day.
Retail and other consumer stocks were among the leaders after encouraging holiday shopping data came out.
Holiday sales ex autos climbed 4.9% from Nov. 1 through Christmas Eve, the largest year-over-year increase since 2011 , according to Mastercard SpendingPulse. Online shopping king Amazon.com ( AMZN ) said it had the biggest holiday sales season ever.
The energy sector was another leader as crude prices reached $60 a barrel, the highest price since June 2015. U.S. crude closed 2.6% higher to $59.97 a barrel. Reuters reported that an explosion in Libya cut a pipeline that provides about 90,000 barrel per day.
A handful of oil stocks topped buy points, including EOG Resources ( EOG ) and Encana (ECA). BP (BP) regained a 41.65 entry. But volume in those stocks was light. It would be difficult to get a big rise in volume because the market is in the slowest week of the year.
Last week, the put-call volume ratio fell almost to 0.6 - an unusually low reading. But this sentiment indicator is not at the extreme levels that would signal excessive froth in the market. Moreover, the ratio since then has risen back to a normal range.
The stock market is winding down the year with just three distribution days and trading near record highs. That should make investors comfortable to add stocks when they find top-quality companies in proper buy areas. Keep checking the IBD 50, Stock Spotlight and other screens for ideas.
On the IBD 50 , most stocks are in good shape except for Stamps.com (STMP), TAL Education (TAL) and Align Technology (ALGN), which have suffered sell signals.
Others that are not in sell situations but could be termed at-risk are Nvidia (NVDA), Atlassian (TEAM), Sina (SINA), Meritor (MTOR), Cognex (CGNX), Applied Materials (AMAT) and Alibaba (BABA). Those leaders are struggling under their 50-day lines.
View the General Market Indicators chart page here .
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