SPX 925 Strikes Again
Last week I highlighed the SPX 925 level as having acted as previous resistance for the market, but that now that the market was nicely above that level, it should act as support the first time it was tested.
That worked well last week for a bounce, and lo and behold today it appears to have worked again. The SPX traded down to 926 this morning, before an afternoon rally pushed the index all the way back into positive territory.
I think very few investors were playing for the late bounce today. I get several market updates each morning, and most of them were calling for a correction, especially after Friday's downward reversal.
But this market has been continually frustrating for the bears, as well as those underinvested and looking for a larger pullback to use to put cash to work.
Here is a summary of today's action:
- A late recovery on Wall Street today may have recaptured some positive momentum.
- The market seemed headed for a weak finish until a Nobel prizewinner said the economy will probably emerge from recession by September. Paul Krugman said in a London lecture there is reason to believe the economy is stabilizing.
- The Dow rebounded from a loss of 130 points, and the Nasdaq erased most of a 30-point decline.
- Apple closed down 93 cents at 143.85, but pared its early losses after introducing a faster iPhone that can record video. Chief executive Steve Jobs did not speak at Apple’s technology conference, but is scheduled to return from a leave of absence by the end of the month.
- General Mills gained 2.06 to 54.22 after hiking its earnings forecast. McDonalds reported disappointing U.S. sales in May, and shares dropped 1.15 to 5872.
- The Dow finished up 1.36 at 8764.49.
- NYSE volume was light and totaled less than 1.07 billion shares.
- The S&P 500 was down 0.95.
- The Nasdaq fell 7.02. Declining issues beat advancers by 3-2 on both the NYSE and the Nasdaq.
- Rising interest rates remain an issue for the markets.
- The 10-year Treasury note fell 18/32, and the yield increased to 3.90%.