Why is Office Depot (ODP) the odd-man-out in Monday's rally among office supply retailers?
Shares of Staples Inc. (SPLS) and OfficeMax
(OMX) were both up by more than 1% on the first trading day of the week. Staples, in fact, was highlighted in 7 Stocks You Need to Know for Monday, where we noted the stock's first visit to oversold territory since climbing back into bull-market territory in mid-February. Shares of OfficeMax were also trading in technically oversold territory after a multi-day pulback above their 200-day moving average before advancing in Monday's session.
So far, shares of Office Depot have not yet participated in this rally. The stock pulled back by more than 1%t on Monday, closing lower for the fourth day in the past five. Office Depot rallied to new six-month highs in late March, and the current selling in ODP likely includes a healthy amount of profit-taking in the wake of that advance.
Weakness in the homebuilding sector continues into the second quarter, resulting in lower prices for companies like The Ryland Group
(RYL). RYL pulled back by 3% in Monday's session, closing lower for a third day in a row. Also closing lower for three days in a row were shares of D.R.
Horton (DHI) selling off by 1%.
Exchange-traded fund (ETF) options for trading the homebuilders include the S&P Homebuilders SPDR ETF (XHB) and theiShares US Dow Jones Home Construction Index Fund ETF (ITB).
Both XHB and ITB have closed oversold for the past two consecutive sessions.
Join Larry Connors for a free, all questions answered preview and introduction to the all-new, Daily Battle Plan. Click
here to learn more.
David Penn is Editor in Chief of TradingMarkets.com
Disclaimer: The views represented in this column are those of the individual authors only, and do not necessarily represent the views of Schaeffer's Investment Research.
Recent XIV Action May Bode Well for Bulls
Featured Partners: AOL DailyFinance
© 2014 Schaeffer's Investment Research, Inc. 5151 Pfeiffer Road, Suite 250, Cincinnati, Ohio 45242
Phone: (800) 448-2080 FAX: (513) 589-3810 Int'l Callers: (513) 589-3800 Email: firstname.lastname@example.org
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
Market Data provided by QuoteMedia.com | Data delayed 15-20 minutes unless otherwise indicated.