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Tech Weakness Drags Stocks Down Early, but the S&P 500 and Russell 2000 Stage Reversals
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

US stocks opened the day a few points higher and quickly cascaded lower. Tech in particular was under pressure, which was down as much as 1.41% at one point during the day. The small-cap Russell 2000 (INDEXRUSSELL:RUT) continued to underperform the large-cap S&P 500 (INDEXSP:.INX), losing 0.92% on a beta-adjusted basis. However, the S&P 500 put in a reversal pattern at the end of the day, as did the Russell 2000, though its reversal was not as strong and doesn't yet indicate that a full reversal is underway. Financials held their 200-day moving average after three straight days of substantial selling and finished strongly positive.

The main equity indices plunged around 30 minutes into the session, shortly after Fed Chair Janet Yellen began her testimony before the Joint Economic Committee. The timing of the drop also coincided with comments from Russian President Vladimir Putin, who said that he was pulling back troops from the Ukraine border. Putin urged pro-Russian separatists to not delay the coming referendum vote on May 25. However, NATO and the US said that there was no indication of a troop withdrawal and Ukraine stated that military drills were continuing on their border.

In her testimony, Yellen reviewed few new pieces of information to the market. She noted that some areas of small-cap stocks were seeing possible overvaluation, but as a whole, equity and broad asset valuations were within their historical ranges. Her testimony also reiterated that there's no formula for when the first rate hike will be and purchases are likely to wind down by the fall. Yellen also said that the Fed is considering steps to curb risk among big financial firms, which could include large asset managers.

FireEye's (NASDAQ:FEYE) poor results last night got tech off to a bad start today and ended up causing a broader sell-off. The stock was down 24.7%. Other cloud- and security-sector stocks fell by similar amounts. Twitter (NYSE:TWTR) continued to be under pressure, tacking another 6% of losses to yesterday's 18% decline.

Tomorrow's Financial Outlook

Tomorrow's only economic report is weekly jobless claims. Economists expect claims to decline to 325,000 and trend back toward their four-week moving average of 320,000. FOMC members Plosser, Evans, Tarullo, Yellen, and Bullard will be speaking in one form or another tomorrow. Chair Yellen will testify before the Senate Budget Committee, where her comments will likely be very similar to today's testimony to the Joint Economic Committee.

One of the main potential catalysts for risk assets overnight is China's April trade balance report. Any significant changes in exports will affect raw materials such as iron ore, copper, and steel and their related stocks. The other event to watch is the ECB rate decision tomorrow morning at 7:45 a.m. EDT. President Mario Draghi is likely to reiterate his very dovish stance on monetary policy, but news reports have indicated that the central bank isn't ready to pull the trigger on further easing. There's an outside possibility that the ECB lowers its benchmark rate to 0.15% and its deposit rate into the negative.

There are 42 major US companies scheduled to report earnings tomorrow. Notable reports include Cablevision (NYSE:CVC), CBS (NYSE:CBS), Regeneron (NASDAQ:REGN), Priceline (NASDAQ:PCLN), IntercontinentalExchange Group (NYSE:ICE), Nvidia (NASDAQ:NVDA), Medivation (NASDAQ:MDVN), RocketFuel (NASDAQ:FUEL), and Monster Beverage (NASDAQ:MNST).

Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
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No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Tech Weakness Drags Stocks Down Early, but the S&P 500 and Russell 2000 Stage Reversals
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

US stocks opened the day a few points higher and quickly cascaded lower. Tech in particular was under pressure, which was down as much as 1.41% at one point during the day. The small-cap Russell 2000 (INDEXRUSSELL:RUT) continued to underperform the large-cap S&P 500 (INDEXSP:.INX), losing 0.92% on a beta-adjusted basis. However, the S&P 500 put in a reversal pattern at the end of the day, as did the Russell 2000, though its reversal was not as strong and doesn't yet indicate that a full reversal is underway. Financials held their 200-day moving average after three straight days of substantial selling and finished strongly positive.

The main equity indices plunged around 30 minutes into the session, shortly after Fed Chair Janet Yellen began her testimony before the Joint Economic Committee. The timing of the drop also coincided with comments from Russian President Vladimir Putin, who said that he was pulling back troops from the Ukraine border. Putin urged pro-Russian separatists to not delay the coming referendum vote on May 25. However, NATO and the US said that there was no indication of a troop withdrawal and Ukraine stated that military drills were continuing on their border.

In her testimony, Yellen reviewed few new pieces of information to the market. She noted that some areas of small-cap stocks were seeing possible overvaluation, but as a whole, equity and broad asset valuations were within their historical ranges. Her testimony also reiterated that there's no formula for when the first rate hike will be and purchases are likely to wind down by the fall. Yellen also said that the Fed is considering steps to curb risk among big financial firms, which could include large asset managers.

FireEye's (NASDAQ:FEYE) poor results last night got tech off to a bad start today and ended up causing a broader sell-off. The stock was down 24.7%. Other cloud- and security-sector stocks fell by similar amounts. Twitter (NYSE:TWTR) continued to be under pressure, tacking another 6% of losses to yesterday's 18% decline.

Tomorrow's Financial Outlook

Tomorrow's only economic report is weekly jobless claims. Economists expect claims to decline to 325,000 and trend back toward their four-week moving average of 320,000. FOMC members Plosser, Evans, Tarullo, Yellen, and Bullard will be speaking in one form or another tomorrow. Chair Yellen will testify before the Senate Budget Committee, where her comments will likely be very similar to today's testimony to the Joint Economic Committee.

One of the main potential catalysts for risk assets overnight is China's April trade balance report. Any significant changes in exports will affect raw materials such as iron ore, copper, and steel and their related stocks. The other event to watch is the ECB rate decision tomorrow morning at 7:45 a.m. EDT. President Mario Draghi is likely to reiterate his very dovish stance on monetary policy, but news reports have indicated that the central bank isn't ready to pull the trigger on further easing. There's an outside possibility that the ECB lowers its benchmark rate to 0.15% and its deposit rate into the negative.

There are 42 major US companies scheduled to report earnings tomorrow. Notable reports include Cablevision (NYSE:CVC), CBS (NYSE:CBS), Regeneron (NASDAQ:REGN), Priceline (NASDAQ:PCLN), IntercontinentalExchange Group (NYSE:ICE), Nvidia (NASDAQ:NVDA), Medivation (NASDAQ:MDVN), RocketFuel (NASDAQ:FUEL), and Monster Beverage (NASDAQ:MNST).

Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

Tech Weakness Drags Stocks Down Early, but the S&P 500 and Russell 2000 Stage Reversals
Today's financial recap and tomorrow's financial outlook.
Minyanville Staff    

US stocks opened the day a few points higher and quickly cascaded lower. Tech in particular was under pressure, which was down as much as 1.41% at one point during the day. The small-cap Russell 2000 (INDEXRUSSELL:RUT) continued to underperform the large-cap S&P 500 (INDEXSP:.INX), losing 0.92% on a beta-adjusted basis. However, the S&P 500 put in a reversal pattern at the end of the day, as did the Russell 2000, though its reversal was not as strong and doesn't yet indicate that a full reversal is underway. Financials held their 200-day moving average after three straight days of substantial selling and finished strongly positive.

The main equity indices plunged around 30 minutes into the session, shortly after Fed Chair Janet Yellen began her testimony before the Joint Economic Committee. The timing of the drop also coincided with comments from Russian President Vladimir Putin, who said that he was pulling back troops from the Ukraine border. Putin urged pro-Russian separatists to not delay the coming referendum vote on May 25. However, NATO and the US said that there was no indication of a troop withdrawal and Ukraine stated that military drills were continuing on their border.

In her testimony, Yellen reviewed few new pieces of information to the market. She noted that some areas of small-cap stocks were seeing possible overvaluation, but as a whole, equity and broad asset valuations were within their historical ranges. Her testimony also reiterated that there's no formula for when the first rate hike will be and purchases are likely to wind down by the fall. Yellen also said that the Fed is considering steps to curb risk among big financial firms, which could include large asset managers.

FireEye's (NASDAQ:FEYE) poor results last night got tech off to a bad start today and ended up causing a broader sell-off. The stock was down 24.7%. Other cloud- and security-sector stocks fell by similar amounts. Twitter (NYSE:TWTR) continued to be under pressure, tacking another 6% of losses to yesterday's 18% decline.

Tomorrow's Financial Outlook

Tomorrow's only economic report is weekly jobless claims. Economists expect claims to decline to 325,000 and trend back toward their four-week moving average of 320,000. FOMC members Plosser, Evans, Tarullo, Yellen, and Bullard will be speaking in one form or another tomorrow. Chair Yellen will testify before the Senate Budget Committee, where her comments will likely be very similar to today's testimony to the Joint Economic Committee.

One of the main potential catalysts for risk assets overnight is China's April trade balance report. Any significant changes in exports will affect raw materials such as iron ore, copper, and steel and their related stocks. The other event to watch is the ECB rate decision tomorrow morning at 7:45 a.m. EDT. President Mario Draghi is likely to reiterate his very dovish stance on monetary policy, but news reports have indicated that the central bank isn't ready to pull the trigger on further easing. There's an outside possibility that the ECB lowers its benchmark rate to 0.15% and its deposit rate into the negative.

There are 42 major US companies scheduled to report earnings tomorrow. Notable reports include Cablevision (NYSE:CVC), CBS (NYSE:CBS), Regeneron (NASDAQ:REGN), Priceline (NASDAQ:PCLN), IntercontinentalExchange Group (NYSE:ICE), Nvidia (NASDAQ:NVDA), Medivation (NASDAQ:MDVN), RocketFuel (NASDAQ:FUEL), and Monster Beverage (NASDAQ:MNST).

Twitter: @Minyanville

Follow the markets all day every day with a FREE 14 day trial to Buzz & Banter. Over 30 professional traders share their ideas in real-time. Learn more.
< Previous
  • 1
Next >
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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