On Tuesday, the Dow Jones Industrial Average opened lower on light profit-taking but turned up on light volume, moving to a new high at the close.
The DJIA rose 0.2%, on the strength of gains by Goldman Sachs Group Inc (NYSE: GS ) and Verizon Communications Inc. (NYSE: VZ ). The S&P 500 gained 0.3% and the Nasdaq jumped 0.5%. The gains registered the third consecutive advance.
The only sector to lose ground on Tuesday was energy, and it fell just 0.1%, and that due to a loss in WTI crude, which fell 1.7% to $50.93 per barrel. The 500's leader was the telecommunications sector, up 1.5%. And the market indices were led by the small-cap Russell 2000 that rose 1.1%, which has broad representation in domestic equities.
At the close, the Dow Jones Industrial Average gained 36 points at 19,252, the S&P 500 gained 8 at 2,212, the Nasdaq rose 24 to close at 5,333, and the Russell 2000 jumped 15, closing at 1,353. The NYSE's primary exchange traded 740 million shares with total volume of 3.6 billion shares. The Nasdaq crossed 1.8 billion shares. On the Big Board, advancers outpaced decliners by 2.4-to-1, and on the Nasdaq, advancers led by 2-to-1. Blocks on the NYSE were virtually unchanged at 3,548 vs. Monday's 3,542.
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Technically, the most significant event of December has been the test of the 500's support line at 2,190. I'd like to see more volume accompany the rally; so far it has been just average, thus a break of support is still possible. MACD has gone flat - not a good sign, which should make traders nervous.
Conclusion: Even if support at 2,190 (close) is broken, there is plenty to buoy prices below that line: The 50-day moving average at 2,158 rests smack in the middle of the broad trading zone from 2,115 to 2,190, and the 200-day moving average at 2,113 is close to 2,115, adding significance to that line.
The most serious problem now is, "What to buy?" Most favorites have had a run of 5% to 15% and are extended too far to buy at current levels. Nevertheless, bargains are there if your hunting instincts are heightened. Note our "Trade Of the Day," which is a good value even if the indices are extended.
Today's Trading Landscape
To see a list of the companies reporting earnings today, click here .
For a list of this week's economic reports due out, click here