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Rough Start

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We are off to dismal start, with the Dow down 90 and the Nasdaq 46 points lower. Once again it looks like we are going to spend the morning testing support - 1890 for the Nasdaq, 1,177 for the S&P 500.

Only six Nasdaq-100 stocks are in positive territory, and four of them are biotech stocks. Chip stocks are the leading losers, with Dell, Adobe, and Peoplesoft thrown in for good measure.

Perhaps the market just doesn't have enough power. Astropower (APWR) and Ballard Power (BLDP) are two of today's biggest point losers. Broadcom (BRCM) Microsemi (MSCC), and Lear (LEA) also top the list.

On the plus side, AdvancePCS (ADVP), Cerner (CERN), Kohls (KSS), and Group 1 Automotive (GPI) are this morning's top point gainers. Group 1's gain is most likely some profit taking from yesterday's big sell off.

Dell is today's most active stock, and the top ten volume leaders are all tech stocks, and all lower.

Semiconductors, Internets, and networking stocks are battling it out for today's worst sector, and are all down over 2.5 percent. The only sectors in positive territory are chemicals, gold, and REITs.

The University of Michigan consumer sentiment data came in at 93.5, better than last month, and above estimates of 92. Overall it seems to be having little impact on the market.

Ford is implementing a "voluntary separation program" that will eliminate 5,000 jobs to reduce expenses during this economic slowdown. General Motors is getting some sympathy selling, and is the Dow's biggest loser.

General Motors Daily Chart

GM had a nice up trend going, gaining over 33 percent in three months. When the directional movement indicator started turning down, GM peaked at $68, and then fell into a trading range between $64 and $61. Two days ago the stock dipped below the 50- day moving average, and today the stock has lost support at $61. Without another late-day rally, GM might be heading down to $59 over the next few days. $57 should be solid support, since it contains three points of support, 200-dma, 61.8% retracement, and a series of previous highs.

Jeffrey Canavan
Assistant Analyst

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