Market Shakes Off Sellers

Stocks rebounded from early losses on Tuesday despite a larger than expected drop in consumer confidence.

The ISDEX rose 1 to 98, and the Nasdaq climbed 8 to 1344. The S&P 500 gained 3 to 902, and the Dow slipped 31 to 8680. Volume rose to 1.83 billion shares on the NYSE, but declined to 1.72 billion on the Nasdaq. Advancers led 17 to 14 on the NYSE, and 18 to 15 on the Nasdaq.

After the close, KLA-Tencor and NVIDIA warned, Cree missed estimates, S1 missed estimates but announced a stock buyback, MicroStrategy topped estimates, and IBM announced the acquisition of PwC Consulting for $3.5 billion.

During the day, , FreeMarkets and CSG plunged more than 30% each on negative earnings reports, and Macrovision slipped on its report.

Dell and EMC rose on positive comments at a storage conference.

Qualcomm slipped on news of potential competition from Motorola .

JDS surged 17% on an upgrade, but BEA slipped on negative analyst comments.

Some technical comments on the market: Note: To see the charts in the text email newsletter, click on the story link at the top of the newsletter.

The Dow (first chart below) barely held onto the lower trendline of a bearish rising wedge today. That lower trendline should be just above 8600 at the open tomorrow, and could be at 8700 or higher by tomorrow’s close. It’s probably a good time to mention that second quarter GDP will be reported tomorrow morning, along with some potentially substantial revisions that could shave a point or more off 1999-2000 GDP. To the upside, 8762 is first resistance, and it’s hard to gauge where that upper trendline will be tomorrow, potentially in the critical 8900-9000 resistance area (see second chart below). The S&P (third chart) is also forming a rising wedge, with critical support in the 890-900 range for tomorrow. The major resistance for the entire market remains 950 on the S&P (fourth and fifth charts). The Nasdaq (sixth chart) is right at the edge of a heavy resistance zone; above 1387, the index could have room to run. To the downside, 1300 and 1286 are important support.






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