
Stocks rallied today so you would think it would be encouraging, but it really wasn't. The rally fizzled out as the day went on, with traders salvaging a very small gain after many days of large losses of late. The Dow finished the day higher by 58 points. The Nasdaq gained 10 points on the session. The S&P 500 gained 4 points, or 0.33%.
What caused the market rally to fizzle out? It could largely be traced to crude oil prices, which were lower by $4 this morning, but rallied to actually finish higher by 59 cents. Investors negativity surrounding all of the economic news coming out also led to the rally being cut short. ![]()
The one thing that was fairly positive about today was the fact that the badly beaten financial sector finally bounced back nearly across the board. JP Morgan Chase & Co. (NYSE:JPM) gained 2.37% today. Merrill Lynch (NYSE:MER) shares rose by 2.31% on the session. Fannie Mae (NYSE:FNM) shares jumped by 6.69% on no real apparent news. A couple other stocks that have been hit extremely hard were also very strong today. E*Trade Financial (Nasdaq:ETFC) and Discover Financial Services (NYSE:DFS) gained nicely, adding 3.47% and 5.37% respectively.
Retailers were pretty strong today as well after retail sales surprised to the upside for the month of May. Kohl's Corporation (NYSE:KSS) gained 3.03% on the session. TJX Companies (NYSE:TJX) shares rose 3.42%, and the stock has outperformed the broader retail group nicely of late. The Gap (NYSE:GPS) shares rose 2.13% after news that the company may consolidate some its stores hit the wires.
Notable 52 week lows
- International Game Technology (NYSE:IGT) Shares fell 3.22% and hit a 52 week low for the second day in a row.
- Abercrombie and Fitch (NYSE:ANF) This steady retailer hit a new low today despite strength in the overall apparel group.
- Bristol Myers Squibb (NYSE:BMY) Lost 1.3% on the day as the pharmas continue to lag the market.
The fact that today's very modest rally came after so much negativity and big down market days makes it very unimpressive to me. The retail sales number was a big boost in the morning, but as the day went on traders focused on oil which was reversing its course. There is certainly a large amount of negativity built into the market right now, but given the current economic environment it is very justified. Oil prices, food prices, housing, the overall credit crisis, rising unemployment, etc are just a few of the things the market has to worry about on a daily basis. It seems about the time one of them gets a little better, another one picks up the slack.
Keep your head up out there, a good buying opportunity will come out of this huge negativity at some point, just not yet.






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Posted by: PRECIOUS | August 14, 2008 1:43 PM | Permalink to Comment