"Similar action today from the previous days, and that isn't good," said Schaeffer's Senior Technical Strategist Ryan Detrick, CMT. "In the end, the five-day losing streak is over, but the afternoon selling left a lot to be desired. If there is one positive, it's that volume hasn't been all that impressive during the recent market weakness. Of course, price is what pays, and it has been disappointing. With a potential government shutdown coming, traders are taking a wait-and-see approach." Against this backdrop, Dow Jones Industrial Average (DJI) managed to close solidly north of breakeven.
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The Dow Jones Industrial Average (DJI - 15,328.30) spiked notably higher right out of the gate, tagging an intraday high of 15,387.19 within the first hour of trading. By the close, however, the blue-chip index pared its gains to 55 points, or 0.4% -- snapping its five-day losing streak. Nike (NYSE:NKE) led the Dow's 21 advancers with a gain of 2.1%, while Cisco Systems (NASDAQ:CSCO) paced the nine laggards with a decline of 2.7%.
The S&P 500 Index (SPX - 1,698.67) experienced some similar price action, peaking at a session high of 1,703.85 earlier this morning. By the closing bell, the index was 5.9 points, or 0.4%, higher -- and thus ending its own losing streak. Meanwhile, the Nasdaq Composite (COMP - 3,787.43) climbed 26.3 points, or 0.7%.
Elsewhere, the CBOE Market Volatility Index (VIX - 14.06) dropped at the sound of the opening bell, but gained ground throughout the day to finish up 0.1 point, or 0.4%.
A Trader's Take:
"Hey, the losing streak is over -- that's good news," said Detrick. "Also, the action in small-caps and tech stocks continues to hold tough. With the quarter nearly over, it is worth noting that the Nasdaq is up more than 11% since the end of June. (I'd say rather quietly, too.) Sure, the S&P 500 has gone virtually nowhere since the May peak, but under the surface, small-caps and tech stocks have done very well. I continue to think that bodes well for a big fourth quarter, as funds chance performance and put cash to work. It's just a matter of time until that can take place, though. We need to work out this Washington drama first."
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For a look at today's options movers and commodities activity, head to page 2.
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