Election Battle Shells Naz
Despite a sharp decline in October’s durable goods orders, stocks stayed
depressed Tuesday as the Presidential election mess dragged on past its
three-week mark. Nasdaq stocks again took the brunt of the day’s pummeling,
falling another 5%. The Nasdaq has now slipped nearly 23% below its election eve
close and a whopping 47% below its March 10 all-time high.
The Dow and S&P 500 held up relatively well Tuesday thanks to strength in
financials and pharmaceuticals. For the day, the S&P 500 lost 1.0%, and the
Dow eased 0.4%.
Volume picked up by about 11% from Monday’s level, as 1.89 billion shares
traded on the Nasdaq and 1.02 billion shares changed hands on the NYSE.
Frustration levels are growing as the ongoing Presidential stalemate is
keeping many portfolio managers sitting on the sidelines, refusing to commit any
new money to such uncertain market conditions. Some commented that the market is
definitely looking for some sort of resolution and direction.
“One thing in the back of my mind is that December has more major
turning points in the market than any other month of the year, and they tend to
cluster around the fourth of December,” said Peter Marin, Portfolio
Manager, Superior Capital Management.
“So, that could coincide with a resolution of the election and remove
that uncertainty from the market, and that might clear the way for a rally
attempt. In the meantime, I think it’s just continued tough sledding and choppy
whipsaw action,” he added.
Top sectors were forest and paper products
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up 1.2% and insurance
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On the weak side were biotechs
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up 8.0%, and semiconductors
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In the financial arena, Fannie Mae
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high 80 1/16. Banks and insurance were also strong, suggesting that the market
sees a greatly increased likelihood of interest rates coming down in the coming
quarters.
Showing up on three of the TradingMarkets downside indicators this morning
was Broadcom
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average volume. Broadcom was singled out on the Propietary Implosion, Implosion
10 Technology, and 60-Day Low on Double Volume indicators. You can view all of
these at the Indicators
At A Glance section.
Top Dow stocks were American Express
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3.5%, and Johnson & Johnson
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Dow losers were Intel
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Microsoft
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Looking ahead, the second quarter revised GDP numbers will be released
Wednesday at 8:30 AM ET. Analysts expect a downward revision to 2.4% from the
recent 2.7% annual rate.