Blue chips plunged Friday on a weaker-than-expected jobs report, but tech stocks fared better on Intel’s reaffirmation of revenue guidance.
The ISDEX http://www.wsrn.com/apps/ISDEX/ slipped 1 to 142, and the Nasdaq lost 17 to 1687. The S&P 500 fell 20 to 1085, and the Dow plunged 234 to 9605. Volume rose to 1.4 billion shares on the NYSE, but declined to 1.7 billion on the Nasdaq. Decliners led 21 to 8 on the NYSE, and 23 to 12 on the Nasdaq. For earnings reports, visit our earnings calendar at http://www.wsrn.com/apps/earnings/internet.xpl and reported earnings at http://www.wsrn.com/apps/earnings/ireported.xpl. For after hours quotes and news, visit our after hours trading site at http://www.afterhourstrading.com.
Intel slipped .26 to 25.84 after saying that revenues will come in slightly below the midpoint of estimates.
Cisco slipped .04 to 14.36 as a report of market share gains was outweighed by a company presentation that weakness will likely continue for 2-6 more quarters.
Dell Computer was unchanged after Michael Dell told Morgan Stanley that the company’s quarter, which ends in October, is on track.
VeriSign surged 4.54 to 38.70 after an upbeat presentation at the SG Cowen conference.
eBay fell 2.14 to 52.95 after filing to sell $1 billion in stock.
Some technical comments on the market: Note: We include charts in the technical market commentary. If you can’t get the charts via the e-mail newsletter version, try this link: http://www.afterhourstrading.com/column.html
The Nasdaq (first chart) half-filled a gap from April 4 at 1639-1700 today (today’s low was 1676). The index is oversold enough to bounce from here, but a trip back to fill that gap is likely at some point. However, when the index half-filled a gap back in June, it rallied for 190 points and almost three weeks before turning down to fill that gap. It’s hard to imagine that strong a rally right here, but some sort of rally should materialize soon. Let’s hope that gap fills first. The S&P 500 (second chart) set a new closing low today, a negative, but missed an intraday low by a point (1081.19). The 1058 level could provide some support below that, and 1100 and 1125 is resistance. The Dow (third chart) is about 100-200 points from a good test of its March-April lows at 9400-9500. 9869-9920 is first resistance. The Cyclical index (fourth chart) had a very ugly day today. We mention that because cyclicals are usually the first place where buying appears, so it’s not a great sign for Monday. On the other hand, chip stocks were strong today, a big plus for the bulls. There is a cycle turn coming up Monday, and the market is very oversold, so we should see a bounce. A gap up and strong close Monday would give a pretty reliable reversal signal in the Nasdaq. However, it’s probably also worth mentioning at this point that market crashes tend to occur from oversold levels. It’s a very low-odds play, and the better way to bet is on a bounce, but it’s definitely possible here. The S&P futures closed at their lows today, showing that futures traders didn’t like what they saw in today’s action, particularly the inability of the S&P to bounce on its retest of the March-April lows. If you want to have some fun, get up at 5:30 a.m. Eastern Time on Monday and watch the action in the futures until 6 a.m. (here’s a link: http://www.cme.com/cgi-bin/gflash.cgi). If someone is going to try to intervene to boost the market, that would be the time and the place. It’s funny how the futures can rally shortly before 6 a.m. on critical days.
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