U.S. markets showed weakness for much of Monday’s action as U.S. tariffs on $200 billion in Chinese goods have officially started. China has reportedly canceled trade talks that had been planned for the coming days while Beijing has also retaliated with levies on $60 billion in U.S. goods.
The trade friction was a drag on the major indexes and caused a pullback to support levels that held with some getting stretched. Volatility held a key level of resistance with a slight rebound in Tech helping offset the rise.
The Dow dropped 0.7% to snap a 4-session win streak after testing a low of 26,548. Upper support at 26,600-26,400 failed to hold with a move below the latter being a continued bearish signal.
The S&P 500 slipped 0.4% following the intraday back-test to 2,912. Support at 2,900 held with a close below this level being a warning sign for additional weakness.
The Russell 2000 also declined 0.4% after trading to a low of 1,697. Support at 1,700 and the 50-day moving average was stretched but held into the closing bell.
The Nasdaq added 0.1% despite tapping a morning low of 7,912. Prior support at 7,900 and the 50-day moving average held before the rebound just shy of the 8,000 level.
Energy showed the most sector strength after jumping 1.5%. Technology rose 0.5% while Healthcare added 2% to round out the winners.
Real Estate and Industrials were the weakest sectors after tanking 2% and 1.7%, respectively. Consumer Staples and Materials sank 1.5% and 1.4%.
Avon Products (AVP) upgraded to Buy from Neutral at DA Davidson
KVH Industries (KVHI) upgraded to Buy from Neutral at Chardan
United Natural Foods (UNFI) upgraded to Sector Perform at RBC Capital
Comcast (CMCSAWealth Strength IndexAAPL is Extremely Up and trending Up) downgraded to Neutral from Buy at MoffettNathanson
Nutanix (NTNX) downgraded to Negative from Neutral at Susquehanna
Pinnacle Foods (PF) downgraded to Neutral from Overweight at Piper Jaffray
Tuesday’s earnings announcements (EST):
Before the open: DXH Media (DXHM), FactSet Research Systems (FDS), IHS Markit (INFO), Jabil Circuit (JBL), Manchester United (MANU), Neogen (NEOG)
After the close: AAR Corp. (AIR), Cintas (CTASWealth Strength IndexAAPL is Extremely Up and trending Up), EnSync (ESNC), IsoRay (ISR), KB Home (KBH), Nike (NKE)
UPCOMING ECONOMIC NEWS
Tuesday’s economic reports (EST):
Redbook – 8:55am
S&P Corelogic Case-Shiller – 9:00am
FHFA House Price Index – 9:00am
Consumer Confidence – 10:00am
Richmond Fed Manufacturing Index – 10:00am
State Street Investor Confidence – 10:00am
METALS / OIL
Gold closed at $1,204.40 an ounce, up $3.10
Silver settled at $14.34 an ounce, down $0.02
Copper finished at $2.84 a pound, down $0.02
Crude Oil is at $72.28 barrel, up $1.50
Bitcoin Investment Trust (GBTC) ended at $8.32 down $0.53
I hope this helps you prepare for tomorrow. Have a great evening.