U.S. markets struggled for a 2nd-straight session while making lower lows as stalled U.S./ China talks and related tariff escalation remained the focus. Increased scrutiny over Chinese telecom companies are at the forefront and are making it harder for U.S. companies to do business deals following the new restrictions.
Near-term support held with more crucial levels waiting in the wings on continued weakness. Volatility made a higher high but settled down into the closing bell to keep a neutral reading on the market.
The Nasdaq dropped 1.5% following the opening back-test to 7,678. Prior and upper support at 7,650-7,600 with a close below the latter signaling additional weakness towards 7,550-7,500 and the 200-day moving averages.
The Russell 2000 retreated 0.7% after testing an intraday low of 1,521. Near-term and lower support at 1,535-1,520 held with risk towards the 1,500 level on a close below the latter.
The S&P 500 was lower by 0.7% while trading to a late day low of 2,831. Fresh and upper support at 2,825-2,800 held with a move below the latter signaling additional weakness towards 2,775 and the 200-day moving average.
The Dow was down 0.3% after trading to an intraday low of 25,560. Current and upper support at 25,650-25,400 was breached but held with the index being trapped between its 50/200-day moving averages for the past 9 sessions.
Utilities and Financials showed some sector strength after adding 0.1% while Energy nudged up 0.05%.
Technology and Communication Services led sector laggards with losses of 1.7%. Real Estate and Materials gave back 1.6% and 1.4%, respectively.
General Dynamics (GD) upgraded to Buy from Neutral at Goldman Sachs
Jack in the Box (JACK) upgraded to Buy from Hold at Stifel
Target (TGT) upgraded to Equal Weight from Underweight at Morgan Stanley
American Airlines (AALWealth Strength IndexAAL is Moderately Flat and trending Up) downgraded to Underweight from Equal Weight at Morgan Stanley
Deutsche Bank (DB) downgraded to Sell from Neutral at UBS
ProAssurance (PRA) downgraded to Underperform from Market Perform at Keefe Bruyette
Before the open (EST):
AutoZone (AZO), Dycom Industries (DY), Eaton Vance (EV), Home Depot (HD), JC Penney (JCP), Kohl’s (KSS), Monro (MNRO), Ship Finance International (SFL), TJX Companies (TJX)
After the close(EST):
Americas CarMart (CRMT), Nordstrom (JWN), Ooma (OOMA), Pure Storage (PSTG), Skyline (SKY), Toll Brothers (TOL), Urban Outfitters (URBN)
UPCOMING ECONOMIC NEWS
Tuesday’s economic reports (EST):
Redbook – 8:55am
Existing Home Sales – 10:00am
METALS / OIL
Gold closed at $1,277.30 an ounce, up $1.60
Silver settled at $14.44 an ounce, up $5.00
Copper finished at $2.72 a pound, down $0.01
Crude Oil was at $63.18 a barrel, up $0.47
Bitcoin Investment Trust (GBTC) ended at $9.95 up $0.72
I hope this helps you prepare for the trading day. Make it a great one!