Prior to the opening bell, stock futures were pointing toward a heavy downdraft, with Dow futures predicting close to a 100-point gap lower at the open and that is roughly where it stood, making what would turn out to be the low point of the day just five minutes into the trading day.
Stocks gained steadily until reaching a peak just before 2:00 pm and then relented, sliding steadily downward into the close. This is the second day in a row which has witnessed large opening gaps - Monday's to the upside and of greater magnitude, today's lower - which benefit only the most adroit professionals and are a bane to the small investor.
Volatility, though subdued when compared to the final two days of the prior week, remains at elevated levels and volume dropped off for the second straight session.
What the markets are attempting to digest is a spate of conflicting events concerning Europe and the bailout of Greece, changing politics in Great Britain, the continuing unnatural disaster from the oil spill in the Gulf of Mexico and a reft of economic data and information that is not easily deciphered.
Housing and unemployment remain as the great contradictory indicators to a general recovery. Without a meaningful rebound in home-buying and employment, any hope for sustained prosperity seem overblown. The nearly $1 trillion thrown at the monetary crisis in Europe is being regarded widely as nothing more than a temporary fix with structural problems as yet not addressed.
The huge bulk of unfunded future liabilities mostly in the form of pensions and health services are keeping a lid on the economies of European nations as well as the United States. Massive government current deficits are already strangling state budgets. In New York, efforts are underway to overturn portions of the state budget which calls for one-day-a-week furloughs for state employees. The budget and the measure was passed on Monday night by the state legislature, at the urging of lame-duck governor David Patterson.
Meanwhile, hearigs were underway in washington, D.C. and New Orleans, concerning Thursday's stock market "flash crash" and the events leading up to an immediately following the oil rig explosion which caused the continuing oil spill of the Louisiana coastline (see video at end of this post).
Dow 10,748.26, -36.88 (0.34%)
NASDAQ 2,375.31, +0.64 (0.03%)
S&P 500 1,155.79, -3.94 (0.34%)
NYSE Composite 7,221.66, -35.96 (0.50%)
Advancing issues outpaced declines on the day, 3719-2812; new highs surpassed new lows, 166-62. Volume was lower for the second straight session.
NYSE Volume 6,583,789,500.00
NASDAQ Volume 2,484,207,000.00
The big winner on the day was gold, which shot up $19.50, to $1,219.90, closing at an all-time high. Silver tagged along, rising 74 cents, to $19.27. Crude oil futures finished the day 43 cents to the downside, at $76.37.
What's moving markets, now that second quarter earnings releases have been pretty much digested, are the markets themselves. Momentum trading is in vogue as equities seek direction. It's a turbulent time not only for stocks, but for stock-watchers as well.
| Oil spill video: Times-Picayune Tuesday update |
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