Stocks Sag in Sluggish Session

It was back to business as usual for the first trading day of the first full week of 2009, meaning that investors went about the business of shedding losers and making incremental bets on safety stocks. Speculation has just about been wrung out of the market along with the wicked volatility that marked trading in the 4th quarter of 2008. In fact, the Dow Jones Industrials, in which 300-500 point daily swings had become commonplace, has only had one day, has only had one 300-point swing - from the low to the high of the day - in its last eight sessions.

Traders have grown weary of the relentless selling pressure, while many are surely sitting out until close to Inauguration Day (Jan. 20) which neatly coincides with the kickoff of 4th quarter earnings season. The duopoly of events should make for some interesting developments nearing the end of the month. For now, however, the major indices are holding onto pretty good gains for '09, garnered on Friday's New Year rally.

Dow 8,952.89, -81.80 (0.91%)
NASDAQ 1,628.03, -4.18 (0.26%)
S&P 500 927.45, -4.35 (0.47%)
NYSE Composite 5,908.43, -7.30 (0.12%)

Monday's losses finished off a three-day winning streak for the major indices, though advancing issues outdid decliners by a wide margin, 4016-2655. New lows continued their domineering streak over new highs, though the margin narrowed once more, to 68-40, in favor of the lows.

Volume was again modest, if not downright depressing. There is a notable lack of enthusiasm, due, no doubt to the vicious beating investors took in 2008. There needs to be more clarity from Washington as well as Wall Street for investors to regain a modicum of confidence that stocks are still good investments. The Dow spent all day underwater, while the other averages only briefly posted positive numbers.

NYSE Volume 1,322,749,000
NASDAQ Volume 1,800,739,000

Commodities were all over the place. Oil gained $2.47, to close at $48.81. Gold slipped $21.70, to $857.80, while silver fell 22 cents, to $11.27. Natural gas futures for March remain stubbornly above their seasonal norm, today gaining 9 cents to close at $6.09. Potential disruptions in Eastern Europe and an unusually cold December have contributed to higher prices for the commodity by which nearly 2/3rds of American homes are heated.

As the world awaits the official taking of power by President-elect Barack Obama, there is a palpably tense mood overwhelming the nation, if not the world. It is as though we are holding our collective breaths - especially with the ongoing violence in Gaza - until we can exhale when we officially appoint a new leader. Until then, the market should only take baby steps, unless there is some remarkable news or event to disrupt the anxiety.