The rally in stocks stalled after the S&P 500 index managed a six-day streak of gains. The index almost hit resistance at the 1,100 level this morning. Overall profit taking has been rather mild. It seems that buyers have stopped to catch their breath and not so much a rise in selling pressure. A minor bounce in the U.S. dollar off 15-month lows is fueling a little bit of a pull back in commodities. Gold futures are down about $2.00 to $1,099.40 an ounce. Crude oil's morning rise has reversed and oil is off about 1.5% near $78.20 a barrel.

The up trend continues in Asian markets although momentum is slowing down. The Japanese NIKKEI index gained 0.6% for its third gain in a row. Traders are expecting potential resistance near the 10,000 mark for the NIKKEI. The Hong Kong Hang Seng was up 0.2%. The Chinese Shanghai index has extended its gains to eight days in a row with a 0.1% rise on Tuesday. Investors expect to hear positive news when the Chinese government releases several economic reports on Wednesday.

Most of the European markets have ended a four-day winning streak. Fortunately profit taking has been pretty mild with stocks oscillating on either side of unchanged most of the session. Mining and commodity stocks suffered the worst profit taking with many equities in this group surging more than 10% in just the last few days. Tomorrow the British government will release data on inflation and unemployment. The English FTSE index lost 0.09%. The German DAX closed down 0.12%. The French CAC-40 index was virtually unchanged on the session.

Real estate was back in the spotlight again after the National Association of Realtors (NAR) released their report on third quarter sales. As we already know home sales rose in the third quarter due to the new home buyer tax credit, which has now been extended by the Obama administration. Unfortunately home prices fell for nearly 80% of the country. If you're a glass is half full kind of person then the good news today is that home prices rose for almost 20% of the markets surveyed. Overall the national median price fell 11% to $177,900 compared to Q3 2008. Foreclosures and short sales (distressed sales) still account for nearly one third of all transactions.

Speaking of home sales Beazer Homes (BZH) reported earnings this morning. The results were vastly improved or down right terrible depending on which numbers you choose to look at. The headline number you're likely to hear is the $0.87 profit (about $34 million) compared to its $474 million loss the same quarter a year ago. Yet if you exclude one-time events, BZH's real earnings were a loss of $1.37 a share compared to analysts' estimates of a loss of $1.24 a share. Revenues fell to $376.3 million for the quarter compared to $649.8 million a year ago. BZH's sales pace fell more than 30% from a year ago and the average selling price dropped 8.6%. The company's cancellation rate improved from 46.3% in Q3 2008 to 34.7%. The stock is currently up about 8.9% near $5.11 a share.

Earnings season is virtually over but there were a few higher-profile names announcing in the last 24 hours. (PCLN) is up more than 17% on the session with a new eight-year high over $200 a share on its better than expected earnings news. Fluor (FLR) is down on worse than expected earnings guidance. MBIA (MBI) is off more than 20% to $3.78 a share on a big earnings miss this morning.

In other news the bond market was quiet ahead of a $25 billion auction of 10-year notes this afternoon. Yields rose to 3.47% ahead of the auction. The bid to cover came in strong at 2.8. The last 10-year auction back in August had a bid to cover of just 2.49.

Currently most of the major U.S. indices are down less than 0.5%. The small cap Russell 2000 index is the exception with a 1.3% decline. Some of the worst performers today are the banks with the banking indices off more than 1.7%. The best performers are healthcare with the HMO index up 0.5%.

Let's take a quick look at charts for the major averages:

Chart of the S&P 500:

Chart of the NASDAQ:

Chart of the Dow Industrials:

Chart of the Russell 2000 index:

I'm not seeing a lot of action on the play list with stocks drifting flat to down across the market. Weakness in the small caps is good news for our IWM put play. Meanwhile LIFE finally broke through resistance at $50.00 and hit our stop loss.