Stock Market Stabs Lower, Dash Hopes For New Uptrend

U.S. stock indexes dived at the open Friday and by late morning, the bulls hadn’t taken back all that much.‘s (AMZN) Q3 report provided an inkblot test for the stock market: Do investors see a stunning 83% beat in earnings, or do they see a 0.9% miss in revenue?


The bearish interpretation prevailed, and the stock indexes confirmed that view.

Hopes related to the stock market’s big percentage gain Thursday were quickly squashed.

The Nasdaq gapped down at the open and was off 2% in late morning action. Blue chips in the Dow Jones industrial average fell the least, down 1.2%. The large cap S&P 500 fell 1.6%, while the small cap Russell 2000 sagged 1.5%.

Volume was slightly higher on both major exchanges.

Amazon fell 10% early and then trimmed the loss to 8%.

Alphabet (GOOGL) also reported quarterly results. The mega-cap beat the Street’s consensus earnings estimate by about 14%. Revenue came in 0.9% lighter than expected. The Google parent stock dropped 3%.

Among IBD’s 197 industry groups, declining groups led rising groups by a 27-1 ratio. Vehicle parts, carmakers and gold miners rose. Data storage, construction products and superregional banks skidded.

Blue chips were down 28-to-2 in the 30-component Dow. Home Depot (HD) knifed down 4%. Intel (INTC) climbed 4.3% early and then faded to a 3% gain. Intel’s Q3 earnings topped views by about 22%. Revenue beat the Street’s number by almost 6%.

Bears Own The Market

The stock market at this juncture has signaled that a new uptrend is nowhere near. Bears own the tone: Pullbacks in the Nasdaq and the NYSE composite have reached as much as 13%; the S&P 500, 10.5%; the Dow, 9%; and the small cap S&P 600, 16.5%.

If a pullback reaches 20%, that would satisfy  the traditional definition of a bear market. The last time a major index fell 20% was from May 2015 to January 2016 in the NYSE composite.


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Originally posted 2019-09-19 23:23:46.


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