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After The Close - The U.S. stock market opened higher today, but gave up its gains in the late afternoon. At the end of the session, the Dow Jones Industrial Average had lost nine points; the broader S&P 500 Index had declined three points; and the technology-laden NASDAQ had surrendered 10 points. Market breadth was negative, as declining stocks outweighed advancers by about two to one on the NYSE. Most market sectors lost ground, with pronounced weakness in the energy and healthcare names. However, some of the consumer issues managed to buck the downtrend.

The stock market has struggled to move higher lately, but with some successes. This is not surprising, given the large gains that equities have logged during the past month. The next catalyst to move equity prices will likely be the upcoming third-quarter earnings season. With September soon coming to a close, traders will likely be looking to earnings pre-announcements in an attempt to gauge the health of the corporate sector.

Meanwhile, there were quite a few economic reports released today. Specifically, initial jobless claims for the week ended August 30th came in at 302,000, which was higher than had been anticipated. Further, the ADP Employment Change report showed 204,000 jobs added to the private sector in August, which while decent, was a bit lighter than had been expected. Traders will get more information regarding this important area of the economy when the government issues its August non-farm payroll figures early tomorrow. Elsewhere, the nation’s trade gap narrowed to $40.5 billion in July. Too, the ISM Non-manufacturing Index rose to 59.6 in August, coming in ahead of the consensus view.

Finally, the corporate news was light today. Specifically, shares of Joy Global (JOY) traded lower, after the mining equipment maker released a weak report and offered discouraging guidance. However, Verifone (PAY) stock moved up, as investors were pleased with the technology company’s figures. - 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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12:05 PM EDT - The hesitation on the part of the bulls, so evident in yesterday's listless stock market trading, has thus far proven to be a one-day affair, as a surprise interest-rate reduction by the European Central Bank (ECB) earlier this morning has given sentiment a modest lift on both sides of the Atlantic.

To wit, after a nicely higher showing in Europe today on the aforementioned ECB move and the absence of any further deterioration in the volatile situation in Eastern Europe, our stock market hit the ground running. Moreover, stocks have held in the win column, albeit with a few wrinkles along the way, as we pass the noon hour along the East Coast.

Meanwhile, in addition to the ECB action, we have had some good news on the economy on our shores. On point, the Commerce Department reported before our market opened that our nation's trade deficit had narrowed to $40.5 billion in July. That was a lesser shortfall than the downwardly revised June trade deficit of $40.8 billion, which initially had been estimated at $41.5 billion. (The consensus expectation had been for a trade gap of $42.5 billion in July.) A gain in U.S. exports led the improvement, which came about in spite of a widening in our trade gap with China, to $30.9 billion.

Then, some 90 minutes later, at 10:00 (EDT), the Institute for Supply Management reported that its gauge of non-manufacturing activity had risen to a reading of 59.6 for last month, which was well above the consensus expectation of 57.5 and the July survey result of 58.7. It should be noted that this survey has shown growth (that is a level of services activity above 50.0) for 55 straight months. It would seem that these two reports, along with the upbeat private-sector payroll data issued today from Automatic Data Processing (ADP), suggest that the U.S. economy will continue to press forward nicely during this half, after a strong second-quarter performance. Please note that tomorrow will bring the headline report for the month, when the Labor Department will issue its data on job growth and the unemployment rate.

As to the reaction to all this on Wall Street, as we noted, the market started the day to the upside and has largely gone from there, with the Dow Jones Industrial Average and the more broadly configured Standard and Poor's 500 Index each posting new all-time intraday highs earlier this morning. That solid showing, along with an even more formidable performance by the tech-laden NASDAQ, has kept the bulls in charge as we head through the first three days of September, which has been the cruelest month historically for Wall Street. Helping sentiment, as well, is a modest comeback in the shares of tech-stalwart Apple (AAPL) after that stocks had fallen somewhat off of its elevated perch yesterday.         

All told, as we reach the noon hour in New York, we find that stocks have backed off a little from their session highs, with the Dow now ahead by 47 points; the Standard and Poor's 500 Index better by six points; the tech-heavy NASDAQ up by 19 points; the S&P Mid-Cap 400 in the plus column by four points; and the small-cap Russell 2000 on the rise by five points. As to the respective groups, we find that seven of the 10 widely followed market sectors are gaining ground so far today, while advancing issues hold a solid five-to-four lead on declining stocks on the Big Board, while the VIX volatility index, the so-called fear gauge of Wall Street, is falling again and is once more suggesting that the market and its participants are growing ever-more confident. That complacency can be a bearish sign if it reaches extremes.

So, as we head into the afternoon, the bulls are still in charge, though less so than in mid-morning, as they await the next overseas drama to unfold and tomorrow morning's labor market report by the government to be released. Given the importance of this latter issuance, we could see further volatility this afternoon. Stay tuned. - Harvey S. Katz

At the time of this article's writing, the author had positions in AAPL.       

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Stocks to Watch from The Survey Corporate news is light this morning, though there are a few companies making headlines ahead of the opening bell. Notably, Joy Global (JOY), a manufacturer of mining machinery and equipment, reported fiscal third-quarter results that missed investors’ expectations, sending the stock down in the premarket. Shares of Ciena Corp. (CIEN), a maker of intelligent optical networking systems, are also indicating a lower opening following the company’s fiscal third-quarter earnings report. However, apparel and accessories designer PVH Corp. (PVH) seems to have pleased Wall Street with its July-period results, and that stock is up nicely in premarket trading. – Kathryn M. Drew

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 - Wall Street, which had marched into September with a full head of steam following solid gains in August, and had added selectively to the aforementioned market strength on Tuesday, headed still higher early yesterday, with the Dow Jones Industrial Average, one of the few losing indexes to start the holiday shortened week, heading some 80 points higher after the first few minutes of trading. That index was joined by most of the other composites. 

Spurring the market on, initially, was a strong showing overseas earlier in the day, especially in Europe. The initial buying on our shores, as was the case in Europe, evolved from optimism that an indicated cease-fire accord between pro-Russian fighters in eastern Ukraine and the government of the latter nation might have some staying power. Moreover, traders were emboldened, as well, by the report of a strong surge in U.S. factory orders in July, with that metric boosted by rising aircraft orders. Also, car sales rose nicely in the latest month, in general. However, as the early trading hours passed, global pessimism returned. That factor, plus a selloff in the recently strong shares of Apple Inc. (AAPL), the high-profile tech stalwart on competitor concerns, led to modest mid-morning selling, especially in the NASDAQ. That is where Apple, the largest U.S. stock by market capitalization, is domiciled.

So, by the noon hour on the East Coast, the market was, at best, mixed. Specifically, the Dow was holding on to about half of its earlier gain, while the NASDAQ was slumping, as was the Standard and Poor's 500 Index, albeit to a lesser degree. The market then moved to and fro with no discernible direction through the early afternoon and the subsequent release of the Federal Reserve's Beige Book at 2:00 PM (EDT). That economic compilation, which is used by the central bank to help formulate monetary policy, held few surprises and was generally constructive regarding the outlook for the nation's economy. The Beige Book essentially intoned that the economy was strengthening following a stressful winter, and that this improvement was rather inclusive, both with respect to the various economic sectors, as well as the respective geographic locales.

That constructive issuance aside, the market then proceeded to weaken some more as the afternoon wore on, with the NASDAQ, which hit another multi-year high early in the session, falling back some 33 points at its session nadir. The Standard and Poor's 500 Index also ticked a bit lower during the final hour of trading, but never by more than four points, three of which were accounted for by the aforementioned Apple. The Dow, meantime, meandered back and forth between small gains and narrow losses. However, the S&P Mid-Cap 400 took on more of a bearish pose, as did the small-cap Russell 2000. Breaking the late-afternoon market down further, we saw that decliners held a moderate edge over gaining stocks on the Big Board, but a more formidable lead on the NASDAQ, reflecting the losses in a number of tech issues. Also, among the major equity groups, there was clear strength in the energy, telecom, and utility stocks, but notable weakness on the tech front.

Then, as the session drew to a close, we saw some spotty buying, which was enough to put the Dow back in the win column, but by just 11 points, while the S&P 500 showed little overall change. But the NASDAQ and the small- and mid-cap composites were all securely in the red, while the breadth of the market was decidedly negative. It was, in the final analysis, a day for modest profit taking, but not for any overt change in direction.

As to the day ahead, in addition to the market trends overseas, where we saw some selling in Asia overnight, especially in Japan and Hong Kong. Conversely, we are now seeing some strength in Europe this morning, and we are seeing the U.S. equity futures head nicely higher with less than an hour to go before the start of the new trading day, with the S&P 500 Index futures ahead by eight points and the NASDAQ better by 11 points. Earlier this morning, the U.S. futures had been lower, but a further cut in the ECB's interest rates had fueled some optimism on both sides of the Atlantic. Meanwhile, ahead of the commencement of trading over here, the Commerce Department has just released data showing that the nation's trade imbalance surprisingly narrowed during July, coming in at a shortfall of $40.5 billion. That was down from June's downwardly revised estimate of $40.8 billion (initially estimated at $41.5 billion). Influencing the deficit was a 0.9% increase in U.S. exports. Conversely, the trade deficit with China widened to $30.9 billion. Looking ahead, the next key economic release will be at 10:00 AM (EDT) when the Institute for Supply Management will issue its August survey on non-manufacturing activity.               

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