Economic Data Shows Market Strength Returning
Once again the markets opened lower this
morning with Electronic Data Systems
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PowerRating) issuing an earnings warning
for Q3 & Q4. Then Jobless Claims & Housing Starts came in weaker then expected.
This continues to worry traders about the pace of an economic improvement. The
markets have been able to rally from the lows of the day when the Philly Fed
Index jumped to 2.3 (consensus was 2.0) from -3.1. This reporting turn calmed
concerns about the economy.
Very few sectors are positive today. Air
freight, Gold
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PowerRating), Restaurant and Footwear.
There are many sectors contributing to today’s weakness. They are Computer
Hardware, IT Services, Advertising, Homebuilding, Tobacco, Aluminum,
Construction, Telephone Equipment, Utilities
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PowerRating), Chips
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PowerRating), Biotechs
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PowerRating), Oil
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PowerRating),
Drugs
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PowerRating), Banks
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PowerRating) and Brokerages
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$XBD.X |
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PowerRating).
The S&P 500
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PowerRating) is bouncing up
after testing the earlier lows on the intraday. Out of the three major indices,
the S&P 500 is performing the worst. Some of the stocks dragging on all three
indices are Electronic Data Systems
(
EDS |
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PowerRating), NVR Inc.
(
NVR |
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PowerRating)
(
CSC |
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PowerRating),
Hovnanian Enterprises
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HOV |
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PowerRating), IBM
(
IBM |
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PowerRating), Morgan Stanley
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MWD |
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PowerRating), Beazer Homes
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BZH |
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PowerRating), Goldman Sachs
(
GS |
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PowerRating) and
Masco
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MAS |
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PowerRating). The 852 support on the intraday
is near the -1.0 Volatility Band (854). Today’s initial resistance is at 859/860, with secondary resistance at 862. A break below 852 could have
the S&P drop off to 848 – 844.
Patterson Dental Supply Co.
(
PDCO |
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PowerRating) is
breaking out of a cup-and-handle pattern with increasing volume. PDCO has a
TradingMarkets.com RS3 rating of 87.
Ball Corp.
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BLL |
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News |
PowerRating)
is pulling back to the 20-day moving average. BLL is holding a
3-month
relative strength rank of 97 from TradingMarkets.com.
Tenet Healthcare
(
THC |
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Chart |
News |
PowerRating) is beginning
to pull back after a thrust higher. The stock is holding a
3-month
relative strength rank of 85 from TradingMarkets.com.
Some of the stocks that are causing the drag
areÂ
Nasdaq Breadth
Adv: 909Â Â Â Â UpVol: 934308
Dec: 2148Â Â DnVol: 6550802
Net: -1239Â Â Net: -5616494
NYSE Breadth
Adv: 990Â Â Â Â UpVol: 1702019
Dec: 2137Â Â DnVol: 6403344
Net: -1147Â Â Net: -4701325