Sellers Take a Breather on Slow News Day

One of the slowest news days of recent memory may have helped investors on Wednesday, halting a two-day slide that threatened to expand into a truly grotesque selling spree. Possibly the best news were two little items: the largest increase in US oil stockpiles since 2001 (9.3 million barrels), and Hewlett-Packard's (HPQ 46.16, +2.47) solid quarter, posting 80 cents a share profit on sales of $28 billion.

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Any news on surplus oil is welcome, as are stellar quarters by sound companies, especially those whose membership includes the Dow Jones Industrials. Hewlett-Packard easily led the 16 other gainers in the blue chip index and itself accounted for much of the gain on the day.

While the US oil stockpile news was significant, it didn't stop traders from upping the price of crude for October delivery in a volatile session. The rise in oil was probably due to a technical situation, one in which the slippery stuff has sold off so much in recent days, that traders are looking for a bounce. Hopefully, for those of us who have felt the pain from higher gas prices, today's gains will be soon forgotten.

Dow 11,417.43 +68.88; NASDAQ 2,389.08 +4.72; S&P 500 1,274.54 +7.85; NYSE Composite 8,276.91 +64.44

Market breadth was nearly non-existent, with gainers outpacing losers, 3181-3020, indicating that today's rise was nothing more than some short covering and minor speculation, rather than the beginning of something more exciting. As further proof, new lows were once well ahead of new highs, 220-43. The most alarming number there is that only 43 stocks (out of a pool of more than 6000) recorded a 52-week high. That's a very, very low number and implying that the general market is going nowhere but down.

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Overall volume continues to be slack and it appears that this week will be the lowest volume stretch of the year, unless, of course, next week is even worse.

Putting today's up-and-down trading into perspective, oil gained $1.02, to $115.56, while gold slipped 50 cents to $816.30 and silver lost 7 cents, closing in New York at $13.15. That the metals did not follow oil's advance may be noteworthy, if only to presage another round of losses for commodities. It will be worth watching commodities closely over the next few weeks, though the most optimistic outlook would be for a small bounce upwards before continuing the trend lower.

With conditions in credit markets still unstable and the general economy looking a little bit putrid, Thursday's unemployment report (new claims) may be more significant than usual. There are few, if any, catalysts for upside momentum, and the bias, despite today's rather unportentious finish, is still rather negative.

NYSE Volume 1,068,481,000
NASDAQ Volume 1,782,049,000