Major Support Levels Back in Play

MARKET SUMMARY

U.S. markets were weak throughout Wednesday’s session following Turkey’s implementation of taxes on American goods from cars to tobacco. Turkey continues to blame the U.S. for its economic woes and imposed retaliatory tariffs on U.S. products after the White House had increased its own tariff levels last week.

Gold and silver stabilized after tapping fresh 18-month lows while copper fell and is approaching late July lows. Potential for contagion in other emerging markets along with possible currency wars push volatility to new heights.

The Russell 2000 sank 1.3% following the backtest to 1,663 and close below the 50-day moving average. July support is at 1,660-1,650 on continued weakness.

The Nasdaq stumbled 1.2% after testing an intraday low of 7,732. Fresh support at 7,750-7,700 and the 50-day moving average held with a close below the latter being a continued bearish development.

The S&P 500 tanked 0.8% after trading to a low of 2,802. The index held major and mid-July support at 2,800 with a close below 2,790 and the 50-day moving average being a bearish development.

The Dow dropped 0.5% after tumbling a low of 24,965. The blue-chips held major and early July support at 25,000 and the 50-day moving average with risk to 24,800-24,600 and the 200-day moving average on a close below this level.

Utilities and Real Estate were sector leaders after rising 0.9%. Consumer Staples added 0.4% to round out the winners.

Energy got hammered after falling 3.5% and was easily the weakest sector. Materials and Communication Services were hit with losses of 1.6% and 1.4%.

ANALYST UPGRADES/DOWNGRADES

Incyte (INCYWealth Strength IndexAAPL is Extremely Up and trending Up) upgraded to Outperform from Sector Perform at RBC Capital
Norfolk Southern (NSC) upgraded to Buy from Hold at Deutsche Bank
Papa John’s (PZZA) upgraded to Hold from Sell at Stifel
Nielsen (NLSN) downgraded to Hold from Buy at Pivotal Research
Tesaro (TSRO) downgraded to Hold from Buy at Argus
Western Digital (WDCWealth Strength IndexAAPL is Extremely Up and trending Up) downgraded to Market Perform from Outperform at Cowen

EARNINGS

Thursday’s earnings announcements (EST): 

Before the open: ​Despegar.com (DESP), JC Penney (JCP), JDWealth Strength IndexAAPL is Extremely Up and trending Up.com (JDWealth Strength IndexAAPL is Extremely Up and trending Up), LSI Industries (LYTS), Qiwi (QIWI), Walmart (WMT)
After the close: ​Applied Materials (AMATWealth Strength IndexAAPL is Extremely Up and trending Up), Nordstrom (JWN), Nvidia (NVDAWealth Strength IndexAAPL is Extremely Up and trending Up), Voxeljet (VJET), Zoe’s Kitchen (ZOES)

UPCOMING ECONOMIC NEWS

Thursday’s economic reports (EST): 

​Housing Starts – 8:30am
Jobless Claims – 8:30am
Philadelphia Fed Business Outlook Survey – 8:30am

METALS / OIL

Gold closed at $1,185.00 an ounce, down $15.70

Silver settled at $14.45 an ounce, down $0.60

Copper finished at $2.56 a pound, down $0.12

Crude Oil is at $64.93 barrel, down $2.11

Bitcoin Investment Trust (GBTC) ended at $9.64 up $0.44

Make it a great day!

   Todd Mitchell

QUOTE OF THE DAY