Volume Makes A Comeback
The markets gapped up on news
that Iraq would submit to an unconditional inspection by the U.N., though soon
faded into negative territory. Price action held a downtrend for the entire
session, with only feeble attempts to rally midday.
The
Dow Jones Industrial Average (
(
$INDU.X |
Quote |
Chart |
News |
PowerRating) closed -2.05% at
8207.55. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) closed -1.97% at 873.52. The
Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) closed -1.24% at 1259.94.
There were no sectors positive
at the end of the day.
Heavy losses were made in gold
and silver
(
$XAU.X |
Quote |
Chart |
News |
PowerRating), -3.96%, oil service
(
$OSX.X |
Quote |
Chart |
News |
PowerRating),
-3.70%, and utilities
(
$UTIL |
Quote |
Chart |
News |
PowerRating), -3.61%.
Volume came back today, as the
major indexes dropped below head-and-shoulders patterns, as well as key support
levels outlined by Gary
Kaltbaum.
The Semiconductor Index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating), -2.10% at 263.56, hit a new three-year low as it closed at the
bottom of its daily range. The Broker/Dealer Index
(
$XBD.X |
Quote |
Chart |
News |
PowerRating),
-2.24% at 393.40, closed at the bottom of its range after turning away from its
20-day average at its high today.
U.S. Treasury Bonds
closed up ‘4 at 112 ’29.
In economic news, August
industrial production fell 0.3% for its first decline of the year. Analysts
were looking for a 0.2% increase. Also, capacity utilization fell 76%,
which was within expectations.
Volume was better than
average at 1,326,960,000
on the NYSE, and 1,482,673,000
on the Nasdaq.
Market breadth was negative,
with NYSE declining issues over advancing issues by a ratio of 2.33, and down
volume over up volume by a 6.49 ratio. Nasdaq declining issues over advancing
issues came in at 1.76, and down volume beat up volume by a 3.16 ratio.
The
VIX
was +1.42 at 41.96. The TRIN
was +1.78 at 2.80.
The only Dow gainers were AT&T
Corp.
(
T |
Quote |
Chart |
News |
PowerRating), +2.51% at 12.63, and Walt Disney
(
DIS |
Quote |
Chart |
News |
PowerRating), +1.01% at
15.98.
Leading the Dow down was McDonalds
(
MCD |
Quote |
Chart |
News |
PowerRating), -12.72% at 18.93, as they announced earnings for the year will come
in less than expected. Also down were American Express
(
AXP |
Quote |
Chart |
News |
PowerRating), -4.56%
at 33.25, Alcoa
(
A |
Quote |
Chart |
News |
PowerRating), -3.45% at 21.52, and Coca Cola
(
KO |
Quote |
Chart |
News |
PowerRating),-3.31%
at 49.00 .Â
Stocks in the news:
Electronic retailer Best Buy
(
BBY |
Quote |
Chart |
News |
PowerRating), +5.68% at
25.46, beat its second quarter earnings estimates by $0.01, with profits of
$0.19 a share.
Computer hardware giant International Business Machines
(
IBM |
Quote |
Chart |
News |
PowerRating),
-0.78% at 71.75, had its third quarter earnings estimates cut by
Salomon Smith Barney to $0.99 a share from $1.02 a share.
Chip maker Microchip Technology
(
MCHP |
Quote |
Chart |
News |
PowerRating), +10.67%
at 17.00, raised its second quarter earnings guidance by a penny to higher gross
margins.
Biotech company Cephalon
(
CEPH |
Quote |
Chart |
News |
PowerRating), +2.44% at
42.75, announced that its experimental drug to treat Attention Deficit
Hyperactivity, Provogil, has produced positive study results.
Also in the biotech sector, D&K Healthcare
(
DKWD |
Quote |
Chart |
News |
PowerRating), -60.20% at 9.51, was downgraded by Prudential to “hold”
from “buy” after the company issued a profit warning.
Supermarket chain Kroger
(
KR |
Quote |
Chart |
News |
PowerRating), -12.49% at 15.76,
posted worse than expected earnings and reduced its targets for the full year.Â
In the drug-making business, Pfizer
(
PFE |
Quote |
Chart |
News |
PowerRating),
-2.28% at 29.51, reduced its earnings outlook for the year, though said it
expects double-digit revenue growth.
Also in the drug biz, Bristol-Myers Squibb
(
BMY |
Quote |
Chart |
News |
PowerRating), -2.92% at 25.19, said it expects to post earnings in line with
estimates.
Gold mining company Barrick Gold
(
ABX |
Quote |
Chart |
News |
PowerRating), -2.17%
at 17.08, announced that it intends to double its profit by 2006 with a bold new
plan to produce an average of 2 million ounces of additional gold over the next
10 years.
Discount broker Charles Schwab
(
SCH |
Quote |
Chart |
News |
PowerRating), -6.14% at
9.17, announced plans to reduce its workforce by 10%.