After The Close -  Traders on Wall Street paused to catch their breath today, after an exhilarating run that has taken the Dow Jones Industrial Average to a succession of 35 closing highs this year, with the latest one occurring just yesterday. Number 36 will have to wait, though. At the end of the latest session, the Dow was off 32 points and the NASDAQ was basically unchanged. The broader market confirmed the weakness, with about two stocks falling for every one rising on the New York Stock Exchange. Still, indicative of the market’s recent strength, the number of issues reaching fresh 52-week highs easily outpaced those hitting new lows.

There wasn’t a lot of corporate or economic news to go around today, but traders seemed to focus on words from Atlanta Federal Reserve President Dennis Lockhart who suggested a tapering of the Fed’s bond-buying program was not out of the question next month. The winding down of the central bank’s so-called quantitative easing program has become a matter of when, rather than if, but later is clearly preferable to sooner for many in the investment community.

The thinking that the Fed may not remain as aggressive in its efforts to hold down long-term interest rates had a negative effect on bond prices, where the yield on the 10-year Treasury note edged higher, from 2.75% to 2.78%. That move, in turn, appeared to take away a measure of support for the rate-sensitive financial and utility sectors. Stocks, such as money center bank Citigroup (C), insurer American International Group (AIG), and power distributor Con Edison (ED) eased as a result.  

The energy sector was another laggard. Oil-related stocks, including services provider Schlumberger (SLB) were hurt by a drop in crude oil quotations. Oil has been moving lower lately, as supplies have been building stateside and as negotiations with Iran over the clarity of its nuclear ambitions has taken some of the fear premium out of the market. Falling oil prices have, meanwhile, translated into lower prices at the pump. The cost of a gallon of gasoline has fallen by 41 cents since Labor Day, which marked the end of the peak driving season. That savings could boost spending this holiday season. 

Elsewhere, the drop in fuel costs made for a strong airline line, with the shares of Delta Air Lines (DAL) and United Continental (UAL) moving nicely higher.    -Robert Mitkowski

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


12:30 PM EST - The U.S. stock market put in a weak session this morning. And, as we pass the noon hour in New York, the major averages are near their session lows. Specifically, the Dow Jones Industrial Average is off 60 points; the broader S&P 500 Index is down seven points; and the technology-heavy NASDAQ is shedding fifteen points. Market breadth also confirms a somewhat negative tone to the session, as decliners are outnumbering advancers by about two to one on the NYSE and the NASDAQ. Further, most market sectors are in negative territory. There are pronounced losses in the basic materials stocks, with declines in the metals names. The energy issues are slipping, too, with losses in the equipment and services stocks. Nonetheless, there is some relative strength in the technology group, thanks to gains in the hardware makers. The industrials are also showing some selective strength.

Technically, the S&P 500 Index continues to move in a sideways direction. Given that the market has logged some large gains over the past month, a period of consolidation is likely in order. So far, we have not seen any full-scale profit taking evolve that would be cause for concern, and it seems that the bulls remain committed to this rally, for now. Notably, the third-quarter earnings season went quite well, with encouraging guidance in many cases, and traders may well be staying put, hoping for a holiday pick up. However, this is likely balanced by concerns about equity valuations, and a sense that the Fed will eventually start tapering its asset purchases, especially as the economy and the employment situation, show further progress.

Meantime, it was another quiet morning for economic reports. Things should pick up a bit tomorrow, as export and import prices for the month of October are due out. Also, Thursday brings the weekly initial and continuing jobless claims.

There were a few earnings reports issued today. Among the bigger names, News Corp (NWSA) shares are trading lower, even though the company posted mixed quarterly results. In home building, DR Horton (DHI) stock is up. That company recorded decent figures, but some analysts may be concerned about the pace of orders. Dean Foods (DF) also is trading lower on a disappointing outlook. - Adam Rosner

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


Stocks to Watch from The SurveyWe’re certainly in the late stages of third-quarter earnings season, but investors are still going over a few more reports this morning. A number of releases did not sit well with investors, and shares of hosting and cloud computing company Rackspace (RAX), auctioneer Sotheby’s (BID), medical supplies company Hologic (HOLX), and wholesale power generation company NRG Energy (NRG) are all indicating lower openings this morning, with RAX and HOLX showing the most weakness. It was not all bad news, however, and shares of homebuilder D.R. Horton (DHI) and satellite television provider DISH Network (DISH) are up modestly ahead of the bell on earnings news. – Matthew E. Spencer

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

Before The Bell - It was a ho-hum, semi-holiday atmosphere on Wall Street yesterday, as Americans observed Veterans Day with rather little overall movement in the major equity averages. When all was said and done, the stock market had a slightly positive tilt to it after the major indexes had stayed near the breakeven point through much of the day.

Restraining activity and the overall price action was a light economic calendar, in which no releases of note were on the docket, after this past Friday's surprisingly strong employment report and subsequent spike upward in share prices. Yesterday, however, the light calendar and the comparatively meager day for earnings, as third-quarter reporting season moves toward its conclusion kept the equity market activity and price movements limited. The aforementioned semi-holiday atmosphere also led to the below-trend price volatility.

Meanwhile, within individual stories, we saw selective weakness on the technology side, with shares of analog circuits maker Cirrus Logic (CRUS) pulling back notably on weak product demand news. In all, that stock fell just over three points on the day, or about 14%.  Also hurting yesterday were the basic materials group, a sector that has certainly had its share of ups and downs in recent weeks, as traders seek to ascertain how well these economically sensitive issues will do in the current mixed business environment. Two areas that did relatively well yesterday were the small-and mid-cap groups. Of note, the Standard and Poor's 400 Index, a key mid-cap benchmark, jumped by more than five points, or about half a percentage point, while the small-cap Russell 2000 added a little less than three points. This dichotomy suggests that the tolerance for risk remains quite significant. The low level of the VIX volatility index, which is at just 12.53, also attests to the lack of serious concerns among the bulls.

At the same time, the Dow Jones Industrial Average, which was helped by a better-than-three-point gain in shares of International Business Machines (IBM), rose 21 points on the day, with that composite, which held in an extremely narrow band throughout the session, closing at 15,783. The Standard and Poor's 500 Index, however, added just over a point, while the tech-heavy NASDAQ essentially just broke even, adding less than a point. It was a quiet day following a pair of sessions in which the market had moved dramatically, first lower than higher. Traders clearly needed a breather, and they got it.      

Looking ahead, the economic calendar will be light again today, as will earnings issuances. Things should be subdued tomorrow, as well, although networking giant and Dow-30 component Cisco Systems (CSCO - Free Cisco Stock Report) will issue its quarterly metrics. Things start to heat up on Thursday with data on weekly and continuing jobless claims being released. Finally, the week is scheduled to conclude with reports on industrial production and capacity utilization released on Friday morning at 9:15 (EST). These latter figures should get an in-depth look as they could have some bearing on what the Federal Reserve does with regard to its bond-buying efforts at its FOMC meeting next month. Last Friday's strong jobs data could tip the scales in favor of some monetary tapering, but we shall see. Many have thought the Fed would act before, only to be surprised as the central bank opted to hold its fire yet one more time.  

Meantime, a new day now dawns on Wall Street, and amid this meager backdrop, shares in Asia were mixed overnight, with Japan's Nikkei up over 2%, while China's lead index dipped back a bit. There wasn't much action in Europe, though, while our equity futures are showing some moderate weakness with a little less than an hour to go before the start of the new trading day. Could we again have a Monday-Tuesday reversal? Stay tuned. – Harvey S. Katz    

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