After The Close
The stock market opened higher this morning, managed to extend its gains through much of the afternoon, before easing slightly in the final hour of the session. At the close of trading, the Dow Jones Industrial Average was ahead 112 points; the broader S&P 500 Index was up 18 points; and the NASDAQ was higher by 51 points. Market breadth showed broad support for equities, with advancers ahead of decliners by a wide margin on the NYSE. All of the major equity sectors participated in today’s advance, with solid gains in the consumer, industrial, and financial issues. The technology stocks, while ahead, showed more modest progress.
Meanwhile, it was a quiet day for economic reports. However, this morning we did get a look at import and export prices for the month of July. There were no major surprises on that front. Tomorrow will be a much busier day. Specifically, we will get a look at the July retail sales figures, a report on second-quarter productivity, industrial production for the month of July, and the latest business inventory figures.
In the corporate arena, a few large companies delivered their results over the past 24 hours. Of note, in the Dow Jones Industrial Average, shares of The Home Depot (HD – Free The Home Depot Stock Report) moved slightly lower, even though the building supply retailer posted respectable results. Tomorrow, we will hear from technology leaders Cisco Systems (CSCO – Free Cisco Stock Report) and NetApp (NTAP).
Technically, stocks continue to perform quite well. However, it remains to be seen how the averages will perform, as the second-quarter earnings season concludes and things quiet down a bit.
– Adam Rosner
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
Before The Bell
So, after we passed the first hour of trading, the Dow Jones Industrial Average, once up some 70 points, had fallen modestly below the neutral line, with a deficit of about 20 points. Things then worsened as the morning drew to a conclusion, and as the problems in that nation intensified. As we passed the noon hour in New York, the Dow had fallen 100 points and the other indexes had eased into the red. Unfortunately for the bulls, there were no economic reports of note to help prop up sentiment. Also, earnings season has just about wrapped up.
Leading the market lower in early afternoon trading were the banks, the energy concerns, and the industrials. The latest setback stateside followed nominal declines in Europe in the morning and more definitive setbacks in Asia, especially in Japan, overnight. Over here, the markets had suffered their worst losses in a month to end last week, as Friday saw a Dow decline of 197 points. Meanwhile, as a new week unfolded, Turkey's central bank announced steps it hoped would stabilize the market there. But stocks and its currency continued to plummet.
In our markets, most stocks fell as the descent in the major indexes worsened. One stock that did manage to buck the lower tide was Apple Inc. (AAPL – Free Apple Stock Report), which rose to yet one more all-time high and remained in the green as the afternoon got under way. It was another story for fellow Dow component International Business Machines (IBM – Free IBM Stock Report), which fell once more, and for erstwhile Dow componentGeneral Electric (GE), which hit another yearly low. Elsewhere, the major large-cap indexes stayed lower into the mid-afternoon, while the small-cap Russell 2000 really took a hit on the chin.
The setback deepened still further for a time, as the Dow would soon drop to a session-worst decline of about 160 points. However, things would start to right themselves again, as the Dow's deficit would be pared to about 40 points and the S&P 500 and the NASDAQ would edge back into the green. That comeback again would prove fleeting, and as the session wound down, the tide would shift lower again, but not as severely as in the early part of the afternoon. As we entered the final half hour of trading, the Dow was back down by 100 points.
Things worsened a little more into the close, with the Dow falling to a final loss of 125 points, making it a 320-point two-day setback for the blue chip composite. Also lower at the close were the S&P 500 Index (off 11 points) and the NASDAQ (lower by 19 points). The Russell 2000 also headed down notably, with IBM remaining among the day's larger casualties. Also, nearly all of the major sectors closed lower, while the Big Board showed about twice as many losing issues as gaining stocks.
Now, following yesterday's second setback in as many days, the markets in Asia, which really took it on the chin yesterday, were mixed in overnight dealings, with Japan recovering and Chinas lagging, while in Europe, the key bourses are trading higher at this time. Also, oil prices are up on Saudi output cuts and Treasury yields, which ticked higher yesterday even with the turmoil in Turkey, are now gaining again this morning. Finally, on another light day for the economy, our futures are pointing to a higher open when trading resumes this morning.
