Morning Update: 10/3/2012

The stock market indices suffered early losses, and at one point late in the afternoon, after they bounced and started to get through the highs, they sold off very sharply in a 5-wave decline. By late afternoon, with an hour to go, they were at their session lows below 2780 NDX and 1440 S&P 500. But when no further selling emerged and they held last week’s lows, they rallied sharply into the close

Net on the day, the Dow was down 32.75 at 13,382.36, about 55 points off the low. The S&P 500 was up 1.26 at 1445.75, about 6 points off the low. The Nasdaq 100 was up 5.01 at 2799.29, 20 points off the low.

Advance-declines were positive by 220 issues on the New York Stock Exchange, and positive by 128 issues on Nasdaq. Up/down volume was nearly flat on New York, with total volume of a light 575 million shares. Nasdaq traded over 1.5 billion, and had a 2 to 1 positive volume ratio.

Stepping back and reviewing the hourly chart patterns, the indices opened with a little bit of a surge at the opening, backed off to support, and rallied back up again. They couldn’t take out the highs, and rolled over in a 5-wave decline late in the day when the indices formed falling wedges, held support, and then snapped back sharply into the close to close with the NDX and S&P 500 slightly in the plus column.

Wednesday, October 3

07:00 MBA Mortgage Purchase Index
08:15 ADP Employment Change – consensus 140K, prior 201K
10:00 ISM Non-manufacturing Composite – consensus 53.4, prior 53.7
01:00 CNY Non-Manufacturing PMI
01:30 AUD Retail Sales
08:00 EUR Eurozone PMI Services
09:00 EUR Eurozone Retail Sales

Monsanto (MON) EPS -44c
Family Dollar (FDO) EPS 75c
Marriott International (MAR) EPS 40c
OCZ Tech (OCZ) EPS -13c

There were no important economic releases on Tuesday. On Wednesday we will get the ISM services index, the ADP employment report and oil inventories.


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