Wednesday kicked the day off very week continuing Tuesdays late day sell off. After that first half hour the bulls started to step in and shrug off the markets weakness. The day closed with the NDX +.57%, RUT + .50%, COMPX +.50%, Dow +.43% and SPX +.35%. Volume was hit and miss throughout the day with the NYSE closing lower like yesterday and the Nasdaq was equal to Tuesday’s. Monday came in heavier than Friday but since then we’ve seen the NYSE fall off. Which is not normal at all on option expiration week, we usually see volume picking up throughout the week not diminishing. The TRIN closed at .92 neutral and the VIX at 22.10 for the 6th day under the 200dma. Gold closed down $3.00 to $1268.70 an ounce and oil down 78 cents to $76.02 a barrel.
The Nas Composite sits just under the 2309.43 8/9 swing highs. The Nas 100 moved just over the 8/9 1918.78 swing high and closed into 1939.77 6/21 highs. The S&P 500 sits just under 1129.24 8/9 swing high. The Dow closed just over 10552.60 78.6% and now has to confirm that break with another day over. The next big resistance for the Dow is at 10719.94. The lift on light volume concerns me and the Nasdaq did this lift on pretty equal volume while the NYSE was lighter. The Nasdaq had the hardware as the strongest sector and SOX as the weakest. That is one really split piece and I have to wonder if that volume was selling on SOX. Something to keep in mind especially with the neutral market breadth.
ES traded with a lag to the NQ today, most of that lag was energy, banks and brokers. Banks closed up 12 cents and brokers down 11 cents, very neutral day. Not a lot of change or movement since the Basel III news on Monday. Which has left banks just under the 200dma and brokers well below the 200dma and taking very small steps up. The sentiment is very concerning with everyone waiting on a pullback that can lead to these creeping higher moves for awhile, we had this in July with the advance after the long weekend. Which led to the sell off in August and now we’ve climbed back near those July highs.
Economic data for the week (underlined means more likely to be a mkt mover): Thursday 8:30 PPI, 8:30 Unemployment Claims, 8:30 Core PPI, 8:30 Current Account, 9:00 TIC Long Term Purchases, 10:00 Philly Fed Manufacturing Index, 10:30 Natural Gas Storage. Friday 8:30 Core CPI, 8:30 CPI, 9:55 Prelim UoM Consumer Sentiment, 9:55 Prelim UoM Inflation Expectations, 11:30 FOMC Member Tarullo Speaks.
Some earnings for the week (keep in mind companies can change last minute: Thursday pre market DFS, FDX, PIR, SMTS and after the bell CKR, ORCL, RIMM. Friday nothing due out.
