Bears Growl, VIX Spikes

MARKET SUMMARY

U.S. markets opened in negative territory and were weak throughout the session following renewed concerns about the political situation in Europe, particularly Italy. There is worry the election could resemble a referendum on the EU and the euro as the bond yield between Italy and Germany widened, putting pressure on banks and global markets. Volatility spiked 30% while closing above a key level of resistance.

The Dow tumbled 1.6% after testing an intraday low of 24,247 to finish at its lowest level since May 8th, or 14 trading sessions. The S&P 500 sank 1.2% following a backtest to 2,676 while closing below the 2,700 level for the first time in 13 sessions.

Both indexes are trading near the 50-day moving average with the Dow closing below and the S&P 500 above this technical level.

The Nasdaq stumbled 0.5% after trading down to 7,354 midday while closing back below the 7,400 level for the first time in 4 sessions. The Russell 2000 gave back 0.2% following the pullback to 1,611 with a move below 1,600 being a continued bearish development.

Both indexes briefly traded in positive territory shortly after the open before wilting to the overall market pressure.

TRADE OF THE DAY

ANALYST UPGRADES/DOWNGRADES

Ford (F) upgraded to Buy from Hold at Jefferies
Occidental Petroleum (OXY) upgraded to Overweight from Equalweight at Capital One
Roku (ROKU) upgraded to Equal Weight from Underweight at Morgan Stanley

Nokia (NOK) downgraded to Hold from Buy at Nordea
Infinera (INFN) downgraded to Underperform from Hold at Jefferies
Saratoga Investment (SAR) downgraded to Neutral from Buy at Compass Point

EARNINGS

Wednesday’s earnings reports (EST): 

Before the open:  Analog Devices (ADI), Bank of Montreal (BMO), Chico’s FAS (CHS), CSW Industries (CSWI), Dick’s Sporting Goods (DKS), DSW (DSW), Evine Live (EVLV), MakeMyTrip (MMYT), Michael Kors (KORS), Movado (MOV), RBC Bearings (ROLL)
After the close: Amerco (UHAL), Box (BOX), Guess (GES), Keysight Technologies (KEYS), NGL Energy Pertners (NGL), PVH (PVH), Semtech (SMTC), Tilly’s (TLYS)

UPCOMING ECONOMIC NEWS
Wednesday’s economic reports (EST): 

MBA Mortgage Applications – 7:00am
ADP Employment Report – 8:15am
GDP – 8:30am
International Trade in Goods – 8:30am
Corporate Profits – 8:30am
Retail Inventories – 8:30am
Redbook – 8:55am
Wholesale Inventories – 8:30am
Beige Book – 2:00pm
Farm Prices – 3:00pm

METALS / OIL

Gold closed at $1,299.00 an ounce, down $4.70
Silver settled at $16.37 an ounce, down $0.17
Copper finished at $3.06 a pound, down $0.02
Crude Oil is at $66.73 a barrel, down $1.15
Bitcoin Investment Trust (GBTC) ended at $12.15 unchanged

Make it a great day!

Todd Mitchell

QUOTE OF THE DAY