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After The Close - Stocks ran out of steam today after a two-day rally that saw the Dow Jones Industrial Average climb 200 points. After trimming moderately steeper losses, the Dow was off nine points at the close, the NASDAQ gave back 12 points, and the S&P 500 eased three points. Market breadth was notably weak, though, with decliners topping advancing issues by about 3-to-2 on the New York Stock Exchange and a more sizable 2-to-1 on the NASDAQ.

Investors didn’t have much to get excited about, with little in the way of earnings or economic data. What business news there was seemed to point in the direction of higher interest rates, too. That came in the form of a report from the Labor Department that showed the number of job openings achieved a 13-year high in June.

More Americans quit their jobs than at any time since June 2008, as well, a sign that workers are less afraid of not being able to find another position. Moreover, they are most likely leaving for better-paying employment. This positive development in the labor market builds a case for the Federal Reserve to raise interest rates more quickly than it otherwise would, if it does turn out that wage pressures are on the rise. The fear of higher rates is one of the factors inhibiting bullishness toward stocks these days.

As for the bond market, yields edged higher, with prices falling, on the 10-year Treasury note. But the anxieties regarding the potential disruption from geopolitical events, plus the need for safety and income during a time when cash is yielding next to nothing, is supporting demand for bonds.

Note: The Treasury sold $27 billion in 3-year notes today at a yield of 0.924%. Upcoming Treasury auctions include $24 billion in 10-year notes on Wednesday and $16 billion in 30-year bonds on Thursday. Uncle Sam still needs the cash. Although the budget deficit narrowed by 3% in July, the deficit was nearly $95 billion. In a positive light, though, the fiscal year-to-date deficit is reported to have fallen 24%, mostly on higher receipts. That is another sign of economic improvement.

Tomorrow brings the start of a busier agenda for business news with the release of retail sales figures for July, where a 0.2% rise is expected. There may also be greater clarity on whether a relief mission being sent to eastern Ukraine from Russia is simply that, or if, as some fear, it also contains military-related material. – Robert Mitkowski

At the time of this writing, the author did not have positions in any of the companies mentioned.

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12:15 PM EDT - The U.S. stock market is trading modestly lower today. A slight retreat here is not surprising, given that it follows two days of gains. Also, today the markets in the United States received little help from the trading overseas. Specifically, weak economic data in Europe and renewed concerns about Russia weighed down the major bourses, dampening the general sentiment. At just past noon in New York, the Dow Jones Industrial Average is down 36 points; the broader S&P 500 Index is off five points; and the NASDAQ is slipping fifteen points. Market breadth suggests a slightly negative bias to today’s session, as declining issues are ahead of advancers on the NYSE. Weakness can be found in the energy sector. Lower crude oil prices are not likely helping the equities in this group. Also, the technology names are slipping, after a solid showing yesterday. Meanwhile, the financials are bucking the downtrend. Too, the defensive utilities are displaying some relative strength.

Stocks have found some support in recent days, after pulling back in late July. However, it should be noted that trading volumes have been light lately, and some additional consolidation may be in order before the bulls can mount a sustained advance. It is not clear what will act as the catalyst needed to push stocks higher from here. The second-quarter earnings season is now largely over. Also, we are in the final weeks of August and that may keep some traders on the sidelines as many participants take their vacations.

Meanwhile, investors received no major economic reports this morning. The lack of information has probably not helped matters, as it provides little direction for traders. Tomorrow will be a busier day for economic news. We will get a look at retail sales for the month of July. Also, business inventories for June are due out.

We did receive a small batch of earnings reports recently. Notably, weak guidance from Nuance Communications (NUAN) and Flower Foods (FLO) are weighing down those stocks. After the close today, we will hear from technology company, Cree, Inc. (CREE) and watchmaker Fossil (FOSL). - Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


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Stocks to Watch from The Survey - Although the majority of second-quarter earnings reports have already been released, there are still some trickling in. One of today’s most upbeat announcements came from Kate Spade & Co. (KATE). The apparel and accessories company delivered June-period sales and earnings that topped expectations, and management increased its full-year 2014 guidance. The stock is up nicely ahead of the bell, in response. Other earnings reports, on the other hand, were not as encouraging. To wit, shares of Flowers Foods (FLO), a producer of packaged bakery goods, and software developer Nuance Communications (NUAN) are both indicating notably lower openings this morning, as both companies’ most recent financials missed the mark. The stock of cloud computing company Rackspace Hosting (RAX) is also moving lower in the premarket on earnings news, albeit just slightly. – Matthew E. Spencer

At the time of this article’s writing, the author did not have positions in any of the companies mentioned. 

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Before The Bell - The highly positive stock market momentum, which had evolved on Friday, and which saw the Dow Jones Industrial Average rally strongly on the possibility that the ongoing military strife near Ukraine was lessening, continued yesterday at the opening. Stocks then built upon those early gains, with the blue chip index running up by nearly 75 points during the morning.

The strength in the Dow was mirrored by the other indexes. To wit, the NASDAQ jumped by some 45 points early on; the Standard and Poor's 500 Index added more than a dozen points, climbing past the 1,940 mark, although even then that composite remained almost 50 points below its all-time peak.     

Behind this comeback was the one-two punch of seemingly diminished conflict overseas, most notably with regard to East-West relations over Ukraine and the military situation in parts of the Middle East, and some dovish monetary policy musings by a normally hawkish Federal Reserve official.

Overall, stocks were still benefiting from Friday's news of defusing tensions globally. Add in yesterday morning's comments from Fed Vice Chair Stanley Fischer, who in prepared comments for delivery at a conference in Stockholm, said that the continuing recoveries across the developed countries have been disappointing, and the makings of a nice rally were in place. Meantime, Mr. Fischer also intoned that the unprepossessing listless outlook was more a cyclical than a structural issue, and that monetary policy adjustments could still be a curative factor. That position would seem to suggest that the Fed will be in no hurry to lift interest rates. Still, some upward move in rates is likely by the middle of next year--if not sooner. 

Those inducements to buy along with some typical Monday merger developments and further positive earnings releases, even as reporting season quickly winds down, gave another boost to the bulls though the first half of the trading day. Stocks then wilted a bit in the early afternoon, with the gains persisting, but at a lesser rate than earlier in the session. The now more modest improvement then carried on through the remainder of the afternoon, leaving the major indexes, which earlier had appeared on the way to back-to-back formidable wins, with decent, but not exceptional, gains on the day.          

All told, the Dow closed up 16 points; the Standard and Poor's 500 Index was better by five points; and the NASDAQ, which had led the way earlier, gained a healthy 30 points. The small-cap Russell 2000 maintained an even stronger bullish presence, as did the S&P Mid-Cap 400 Index. Meanwhile, nine of the ten of the equity groups pushed higher, with only the utilities easing nominally, while on the Big Board nearly three times as many stocks gained on the session as fell. It was a solid day by all accounts, but one that lacked the excitement of Friday. For technicians, the back-to-back wins for the market put talk of a looming correction well into the background.

Meanwhile, yesterday's modestly bullish market action took place on a light economic news day. That pattern will continue today, but tomorrow, the Commerce Department will issue the latest month's data (for July) on retail spending. A 0.2% increase is the consensus forecast. That data will be followed by Thursday's reports on initial and weekly jobless claims and import prices for July. Then, the week concludes on Friday with reports on producer prices, manufacturing in the greater New York area, and data on industrial production, factory utilization, and consumer sentiment. This last report will be released by the University of Michigan and cover the first days of August. As to earnings, networking giant Cisco Systems (CSCO - Free Cisco Stock Report) is set to issue its latest quarterly metrics tomorrow, while fellow Dow mainstay Wal-Mart's (WMT - Free Wal-Mart Stock Report) results are due out on Thursday.   

Looking at the markets overseas today, we find that stocks in Asia were largely higher overnight, while equities are pressing a little lower in Europe thus far this morning, with the most pronounced weakness in Germany's DAX and the Paris CAC-40. The softness on the Continent follows a weak consumer sentiment index put in Germany. Meanwhile, our futures, after yesterday's modest win are somewhat mixed at this time, having given back modest gains earlier in the day, as the bulls seek to make it three wins in as many sessions.   - Harvey S. Katz

At the time of this article’s writing, the author held positions in one or more of the companies mentioned.