"After six straight up days [in the S&P 500 Index], the market was due for a breather," noted Schaeffer's Senior Technical Strategist, Ryan Detrick, CMT. Indeed, the Dow Jones Industrial Average (DJI) consolidated lower right out of the gate. A flicker of buying power in the final hour of trading proved to be a false start, as the index closed below 13,200.
Continue reading for more on today's market, including:
The Dow Jones Industrial Average (DJIA) moved lower for a second consecutive session, giving back 75 points, or 0.6%. At its lowest point of the day, it's worth noting, the blue-chip average was off more than 98 points. Just five Dow names managed to escape the selling. Caterpillar (NYSE:CAT) enjoyed a 0.5% gain, leading the pack, while Merck (NYSE:MRK) shed 2% to pace the lagging majority.
The S&P 500 Index (SPX) saw a similar pattern, slumping 9 points, or 0.6%. The Nasdaq Composite (COMP), meanwhile, gave back 22 points, or 0.7%, to bring up the rear among its sector peers. While the Dow and the SPX managed to stay atop their 10-day moving averages, the COMP closed on the south side of this trendline.
The CBOE Market Volatility Index (VIX) retook the 16 level today, rising 0.6 point, or 3.5%.
A Trader's Take:
"There wasn't any specific reason the market dropped today," Detrick opined. "It was a slow news day after the Fed, but I was impressed with the solid weekly initial jobless claims number." He continued, "We all know the concerns out there -- I'm talking to you, fiscal cliff -- but to see initial claims under 350,000 is a huge step in the right direction. Now the key will be... can the number stay below this threshold?"
3 Things to Know About Today's Market:
Plus ... Frito-Lay -- a division of PepsiCo (NYSE:PEP) -- has introduced cola/chicken-flavored potato chips, which are reportedly "vaguely similar to barbecue with a sugary aftertaste." Unfortunately (or not), the novelty snack will only be sold in China.
Today's Top Tweet:
"Shorting this market must feel like being an Arizona Cardinals fan. Someday, it's gotta happen. Right?"
@EddyElfenbein, 11:13 a.m.
5 Stocks We Were Watching Today:
Question of the Day:
Q: What does it mean if a stock is considered "hard to borrow"?
A: If a stock is on the hard-to-borrow (HTB) list, it is in short supply or can no longer be lent by brokers for short-selling purposes. As a result, a broker's clearing firm must typically use a third party to locate the shares. Additional fees are required for this service, which are then passed on to the brokerage customers. There are different reasons stocks may become hard to borrow, including takeover situations or solvency concerns. Also, some stocks do not have a sufficient "float" (shares available for public trading) to allow for short selling. The list of HTB stocks may vary by brokerage, so contact your advisor for information regarding specific equities.
For a look at today's options movers and commodities activity, head to page 2.
Recent XIV Action May Bode Well for Bulls
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