Why Low Volume May Be A Positive Sign
The indexes traced out choppy
patterns in today’s session, with opening reversals turning into volatile moves
trending up.
The
Dow Jones Industrial Average (
(
$INDU.X |
Quote |
Chart |
News |
PowerRating) closed -0.79% at
8312.69. The S&P 500
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) closed +0.32% at 889.81. The
Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) closed +0.91% at 1291.40.
The day’s gainers were Internet
(
$ECM.X |
Quote |
Chart |
News |
PowerRating), +2.89%, biotechnology
(
$BTK.X |
Quote |
Chart |
News |
PowerRating), +2.06%, computer
hardware
(
$HWI.X |
Quote |
Chart |
News |
PowerRating), +2.03%, and utilities
(
$UTY.X |
Quote |
Chart |
News |
PowerRating),
+1.92%.
The biggest losers were
networking
(
$NWX.X |
Quote |
Chart |
News |
PowerRating), -4.38%, airlines
(
$XAL.X |
Quote |
Chart |
News |
PowerRating), -3.35%, and
telecoms
(
$IXTC.X |
Quote |
Chart |
News |
PowerRating), -2.45%.
The major indexes all put in
negative performance for the week. Volume remained light Friday, though
according to Kevin
Haggerty, it can be a part of a larger bottoming process. Next Monday’s
volume is expected to be on the light side again due to the Jewish holiday Yom
Kippur.
U.S. Treasury Bonds
closed up ’29 at 113 ’20.
In economic news, PPI
surprised with a reading of 0.0% vs. an expected 0.1%, core PPI was at
-0.1% vs. an expected 0.2%. Retail sales also came in better than
expected with a reading of 0.8% vs. the expected 0.5%, retail ex-auto was
at 0.4% vs. the expected 0.2%, and the University of Michigan’s preliminary
sentiment number came in at a disappointing 86.2 vs. an expected 88.0.
Volume was light at 1,204,921,000
on the NYSE, and 1,261,970,000
on the Nasdaq.
Market breadth was mostly
positive, with NYSE advancing issues over declining issues by a ratio of
1.28, and down volume over up volume by a 1.11 ratio. Nasdaq advancing issues
over declining issues came in at 1.22, and up volume beat down volume by a 1.30
ratio.
The
VIX
was -1.41 at 39.31. The TRIN
was -1.05 at 1.42.
Leading the Dow were Home
Depot
(
HD |
Quote |
Chart |
News |
PowerRating), +2.98% at 33.45, Wal-Mart
(
WMT |
Quote |
Chart |
News |
PowerRating), +2.40% at 54.40, AT&T
(
T |
Quote |
Chart |
News |
PowerRating), +2.25% at 12.72, Intel Corp.
(
INTC |
Quote |
Chart |
News |
PowerRating), +2.10% at 16.03, and Microsoft
(
MSFT |
Quote |
Chart |
News |
PowerRating), +1.61% at 47.91.
The only Dow gainer was International
Paper
(
IP |
Quote |
Chart |
News |
PowerRating), +1.16% at 37.33.
Aerospace and defense company
Honeywell
(
HON |
Quote |
Chart |
News |
PowerRating), -16.87% at 23.56, reduced its third-quarter profit
estimates and has been downgraded by JP Morgan to “market perform”
from “buy.”
Stocks in the news:
Software maker Adobe Systems
(
ADBE |
Quote |
Chart |
News |
PowerRating), +12.57% at
20.77, beat its third-quarter earnings consensus by 3 cents with profits of 22
cents per share.
Medical supply company Baxter International
(
BAX |
Quote |
Chart |
News |
PowerRating), -0.46% at 32.44, was reported by the FDA to be potentially linked to
five deaths through their dialysis machines. The company has also been
downgraded by Goldman Sachs to “market perform” from” market
outperform.”
Software company SAP
(
SAP |
Quote |
Chart |
News |
PowerRating), -4.50% at 15.28, was
downgraded by UBS Warburg to “hold” from “buy” based on
channel checks that suggest fourth-quarter revenue should be flat instead of the
5%-10% growth anticipated by the company.
Chip maker ESS Technology
(
ESST |
Quote |
Chart |
News |
PowerRating), -31.43% at
7.70, fell after reducing its earnings estimates for the year. Competitor Zoran
(
ZRAN |
Quote |
Chart |
News |
PowerRating), -13.14% at 11.50, was also affected by the news.