What May Follow Emotional Open…
Stocks
were hammered again as price action on the major indexes cruised
south from open to close. Leading the plunge were gold and silver, telecom,
semiconductors, natural gas, and Internet issues, while no sector managed to
close positive.
Scores of new lows were
achieved today, as the Semiconductor Index
(
$SOX.X |
Quote |
Chart |
News |
PowerRating), down 5.80%,
led the Nadaq to its lowest close in five years. Heavy selling at the end of the
session often translates into an emotional gap-down the following day, where
Kevin Haggerty‘s volatility bands often produce excellent reversal zones.
The Dow Jones Industrial
Average
(
$INDU.X |
Quote |
Chart |
News |
PowerRating) closed down 3.24% at 8043.63. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) closed down 3.42% at 834.60. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating)
closed down 3.36% at 1205.96.
U.S. Treasury Bonds were
up ‘7 at 107 ’30.
In economic news, the Institute of Supply Management’s
July non-manufacturing index fell to 53.1%Â from June’s 57.2%
reading, adding to a recent strong of negative reports.
Market breadth was negative,
with NYSE declining issues over advancing issues by a ratio of 3.19, and down
volume over up volume by a 7.53 ratio. Nasdaq declining issues over advancing
issues came in at 2.46, and down volume beat up volume by a 9.72 ratio. The
VIX was up 3.92 at 49.31. The
TRIN was up 0.75 at 2.29.
Below average volume had the Dow the S&P 500, and
the Nasdaq closing near the bottom of their daily ranges. The Broker/Dealer
Index
(
$XBD.X |
Quote |
Chart |
News |
PowerRating), , also closed near the bottom of its range.
The top sectors: There were no sectors to close
positive.
Losing
sectors of the day were the Gold and Silver Index
(
$XAU.X |
Quote |
Chart |
News |
PowerRating),
down 6.42% at 59.17, and the Combined Telecom Index
(
$IXTC.X |
Quote |
Chart |
News |
PowerRating),
down 6.37% at 84.95.
Home product company Proctor & Gamble (PG),
down 2.67% at 87.44, beat its fourth-quarter earnings expectations by
3 cents with profits of 77 cents a share.
Financial services company Citigroup (C)Â
down 7.22% at 28.65, was rated “equal weight” in a grading system by Lehman
Brothers, the stock was rated a “strong buy.”
Also in the financial service sector, JP Morgan (JPM),
down 6.28% at 22.35, was rated “equal weight” in a grading system by Lehman
Brothers, the stock was rated a “strong buy.”
Business services company PayChex (PAYX),
down 6.16% at 22.39, has been downgraded by Goldman Sachs to “market
perform” from “recommended list.”
Broadcasting and cable TV company Cox Communications
(
COX |
Quote |
Chart |
News |
PowerRating), down
19.30% at 20.19, was upgraded by CSFB to “hold” from “strong buy.”
Networking giant Cisco Systems
(
CSCO |
Quote |
Chart |
News |
PowerRating), down 4.45% at 11.36, will
announce fourth-quarter results tomorrow, where Thompson Finacial/First Call
believes the company will post profits of 12 cents a share. Meanwhile the
company has been downgraded by Lehman Brothers to “equal weight” from “strong
buy.”
From TM’s proprietary Implosion List: conglomerate Siemens
AG
(
SI |
Quote |
Chart |
News |
PowerRating), down 7.93% at 40.51, metal mining company Phelps Dodge
(
PD |
Quote |
Chart |
News |
PowerRating),
semiconductor company Maxim Integrated Products
(
MXIM |
Quote |
Chart |
News |
PowerRating), .