Thursday recap: Stocks had their second 1% decline of the week as investors were faced with selling pressure from bell to bell on a number of fronts. The DJIA and S&P 500 are now again showing negative returns YTD.
More significantly the S&P 500, -1.4% at 2045.95 closed below both its 200 day moving average of 2064 and below 2050, which was a key support level earlier this year during the Spring and Summer. NASDAQ, -1.2% at 5005.08 did manage to hold the 5000 level, although that could get a further challenge today following the negative reaction investors had to CSCO’s earnings and conference call yesterday after the close.
Crude Oil slid another 2%+ bringing declines over the last 2 days to over 5% and setting up what looks like an inevitable test of the key $40 support level. Inventory numbers from earlier in the week show near record supplies of oil around the globe with storage facilities and oil tankers filled to the brim.
We’ll get a Rig Count # at 1:00 PM today that will likely show another decline in active rigs, but the Supply side of the equation is dominating the price action right now.
Stock Market Today 11-13-15
Retailers continue to be a mess at the worst possible time of the year. Following up on Wednesdays 15% decline by Macys, Nordstrom; JWN, traded 20% lower after cutting its forecast for the year following a disappointing report after the close on Thursday.
We now have multiline retailers in 3 major segments of the market, Walmart, Macys, and Nordstrom all trading at least at 3 year lows, and 40% off their highs from earlier this year. Yes, I know AMAZON is a factor here, but none of the above mentioned retailers offers video streaming or Cloud services, and AMAZON is “crushing it” in both of those markets.
Earlier this morning, the October retail sales report came in a bit worse than expected at +0.2 % ex autos vs. expectations of +0.4%
The DJ Transports, -1.5% at 8059.54 closed fractionally below their 50 day moving average for the first time since early October. On Monday of this week, the reversal in the Transports helped the market recover from what could have been much sharper losses, sparked by 10 point rally in NSC on takeover interest from Canadian Pacific.
What’s particularly disturbing about the underperformance in the Transports from Thursday is that NSC has held nearly all of its gains from Monday, and the Transports are right at Monday’s intraday lows which was before the sharp rally in NSC.
No doubt investors are looking forward to the weekend, although will likely have renewed anxiety over the health of the equity markets going into next week.