Small-Caps Slack in Mixed Session

U.S. markets were mixed on Wednesday as strength in the blue-chips outweighed the weakness in Tech and the small-caps. January resistance levels remains in play for the Dow while near-term and fresh support levels held for the other major indexes.

Economic news was better-than-expected and volatility slipped to its lowest levels in 4 weeks. The action is still suggesting higher highs over the near-term and ahead of 3Q earnings season that starts in early October.

The Dow jumped 0.6% after reaching an intraday peak of 26,464. Lower and fresh support at 26,400-26,600 held with the all-time high at 26,616.

The S&P 500 gained 0.1% following the intraday push to 2,912. New resistance at 2,925-2,950 remains in play on a close above the all-time high at 2,916.

The Nasdaq slipped 0.1% after testing an intraday low of 7,917. Upper support at 7,900-7,875 and the 50-day moving average easily held with a close below the latter being a warning signal.

The Russell 2000 slipped 0.5% following the backtest to 1,700 and the 50-day moving average. Upper support at 1,700-1,690 held with a close below the latter being a bearish development.

Financials zoomed 1.7% to led sector strength while Materials surged 1.1%.

Utilities tanked 2.2% and easily led sector laggards while Real Estate fell 1%.

Mechel (MTL) upgraded to Neutral from Sell at Citi
Juniper (JNPR) upgraded to Buy from Neutral at Nomura Instinet
Transocean (RIG) upgraded to Outperform from Market Perform
LyondellBasell (LYB) downgraded to Underweight from Neutral at JPMorgan
OMA Airports (OMAB) downgraded to Hold from Buy at Santander
Platform Specialty Products (PAH) downgraded to Neutral from Buy at Citi

Thursday’s Earnings Announcements:
Before the open: Darden Restaurants (DRI), Thor Industries (THO)
After the close: Micron Technology (MUWealth Strength IndexAAPL is Extremely Up and trending Up), Research Solutions (RSSS), Steelcase (SCS), United Natural Foods (UNFI)

Thursday’s economic reports (EST):
Jobless Claims – 8:30am
Philadelphia Fed Business Outlook Survey – 8:30am
Existing Home Sales – 10:00am
Leading Indicators – 10:00am

I hope this helps you prepare for tomorrow. Have a great evening.

   Todd Mitchell