Bears Erase 2018 Gains

U.S. markets showed continued weakness on Monday’s open and a backtest towards the 50-day major moving averages before rebounding off session lows. However, the selling pressure increased into the closing bell with late November support coming into play as the major indexes gave back all of their gains for 2018. It remains to be seen if a short-term bottom is in, as other major pullbacks have been bought, and will depend on how much volatility settles down on any rebound.

The Dow dropped 4.6% after falling 1,597 points to a low of 23,923 and 10% off its all-time high of 26,616 set just 7 sessions ago. The S&P 500 sank 4.1% after testing a low of 2,638 and was 9% of its all-time high of 2,872, at one point.

The Nasdaq gave back 3.8% after testing a low of 6,967 late in the day. The index rebounded over 200 points shortly after the open to trade into positive territory before the selling pressure returned.

The Russell 2000 traded in negative territory throughout the session while bottoming at 1,491 to push early November support while closing below its 100-day moving average.

Financials were crushed for 5% while Industrials and Health Care were punished for 4.5% and 4.4%. There was no sectors that closed in positive territory.


Lowe’s (LOW) upgraded to Buy from Hold at Jefferies PayPal (PYPL) upgraded to Outperform from Market Perform at Wells Fargo Norwegian Cruise Line (NCLH) upgraded to Overweight from Neutral at JPMorgan Amgen (AMGN) downgraded to Neutral from Overweight at Atlantic Equities Dick’s Sporting (DKS) downgraded to Underweight from Equal Weight at Barclays VMware (VMW) downgraded to Neutral from Buy at Citi

Tuesday’s scheduled earnings include:
Before the open: Allergan (AGN), BP (BP), Colfax (CFX), Cummins (CMI), Emerson Electric (EMR), General Motors (GM), Lennox International (LII), RBC Bearings (ROLL), Spirit Airlines (SAVE), Tapestry (TPR)

After the close: Akamai Technologies (AKAM), Beazer Homes (BZH), Chipotle Mexican Grill (CMG), Extreme Networks (EXTR), Farmer Brothers (FARM), Gilead Sciences (GILD), j2 Global Communications (JCOM), Markel (MRK), Match Group (MTCH), Microchip Technology (MCHP), NetGear (NTGR), Proofpoint (PFPT), Snap (SNAP), Walt Disney (DIS)

Tuesday’s economic reports (EST):
International Trade – 8:30am
Redbook – 8:55am
Jolts – 10:00am

Gold closed at $1,336.50 an ounce, down $0.80
Silver settled at $16.67 an ounce, down $0.04
Copper finished at $3.22 a pound, up $0.04
Crude Oil closed at $63.49 a barrel, down $1.96
Bitcoin Investment Trust (GBTC) settled at $10.05, down $1.95


Make it a great day!

Todd Mitchell