Morning Update: 8/23/2012

The stock market indices had a mixed session at the close, but came way off the lows after the FOMC made some positive statements that helped the market rally.  It was a very ominous, nasty day on Wall Street on Tuesday, particularly for the Nasdaq 100 market generals, which ultimately…

The day started out, however, with a dip. They then bounced, with the Nasdaq 100 acting much better than the S&P 500. By midday the S&P 500 had made nominal new lows near 1407, but the pullback midday on the NDX was far from the earlier lows. That was a positive divergence causing the market to rally into the FOMC.

At that point, they popped, pulled back, tested intraday moving averages, and then rocketed with a half hour to go to the highs for the day. The NDX had rallied from 2759 to 2790, about 31 points at that point, while the S&P 500 jumped from 1407 to 1416, about 9 points. In the last half hour they backed and filled, and consolidated, but held support, and closed mixed on the session.

Net on the day, the Dow was down 30.74 at 13,172.84, about 32 points off its high and 42 points off the low. The S&P 500 was up .34 at 1413.51, only 3 points off its high and 7 points off the low. Apple and Google were sharply higher, and the NDX closed up 11.22 at 2783.42, 7 points off the high and 24 points off the low.

Advance-declines were still 3 to 2 negative on New York Stock Exchange, and 3 to 2 negative on Nasdaq as well. Up/down volume was just slightly negative on New York, with total volume of 583 million shares. Nasdaq traded over 1.4 billion, and had a 4 to 3 negative volume ratio.

Stepping back and reviewing the hourly chart patterns, the indices opened lower, bounced, and then made midday lows before a big afternoon rally following the positive FOMC statements. The market closed mixed on the session, with Nasdaq 100 up solidly on the day. Key support did hold today, and now we’ll be watching 2760 NDX and about 1408 S&P 500 to see whether that level and that key level can hold.

We’ll see how it goes tomorrow.

Thursday, August 23

Economics
08:30 Initial Jobless Claims – consensus 364K, prior 361K
08:30 Continuing Claims – consensus 3300K, prior 3332K
08:58 Markit US Flash PMI – consensus 51.5
10:00 New Home Sales – consensus 365K, prior 350K
10:00 House Price Index – consensus 0.5%, prior 0.8%
11:00 Fed buying $1.5b-$2b Treasuries in 10 to 20-year range
1:00 Treasury selling $14b in 5-year TIPS
02:30 CNY HSBC Flash Manufacturing PMI
06:00 CHF Trade Balance
06:00 EUR German GDP
07:30 EUR German PMI
08:30 EUR PMI
14:00 EUR Eurozone Consumer Confidence

Earnings
Before:
No reports
After:
Aruba Networks (ARUN) EPS 17c
Salesforce.com (CRM) EPS 39c

Existing home sales were higher by 4.47 million, less than the expected 4.50 million. Oil inventories dropped 5.4 million barrels. Last week they declined by 3.7 million.

 

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