Replies to post #355661 on Option Millionaires

[uranium-pinto-beans]

ISM report drives lull in rebound action
The stock market had quite the day on Wednesday following the speech from Fed Chair Powell, staging a huge rally on a sense of relief that the Fed Chair did not sound as hawkish with his policy commentary as many had feared he would sound. The stock market, though, is not having the same kind of day today.

The stock market is a bit weaker, contending with the notion that it might have overreacted yesterday and that the growth environment is going to be challenging given the past rate hikes and the rate hikes that are yet to come. A 49.0% reading for the November ISM Manufacturing Index, which is the first sub-50% reading (the dividing line between expansion and contraction) since May 2020, has reined in some of the rebound enthusiasm.

The 2-yr note yield is down eight basis points to 4.30% and the 10-yr note yield is down 12 basis points to 3.58%.

Stocks pushed higher out of the gate, supported by some pleasing personal income and spending data for October and a welcome moderation in the PCE and core-PCE Price Indexes, yet that move was stymied by the ISM release at 10:00 a.m. ET and some resistance for the S&P 500 at the 4,100 level.

The pullback following the ISM release took the S&P 500 back to 4,050, which was right on top of key support at the 200-day moving average (4,048). That line of support held, but it will be a key area to watch in coming hours/days. Market bulls will want to see it hold up and preferably with the support of heavy volume.

There aren't any sectors that are particularly strong. Energy (+0.2%) and communication services (+0.3%) are the biggest gainers. Most other sectors have fallen prone to some consolidation activity. The biggest loser thus far is the financials sector (-0.9%).

An ugly showing from Salesforce (CRM 144.59, -15.66, -9.8%) following its earnings report, and news that Bret Taylor will step down as co-CEO at the end of January, is the principal reason why the Dow Jones Industrial Average is underperforming.

Otherwise, there has been a general lull in the rebound action. The Russell 3000 Value Index and the Russell 3000 Growth Index are both down 0.2%.

The Russell 2000 is down 0.1%; the Nasdaq Composite is down 0.2%; the S&P 500 is down 0.4%; and the Dow Jones Industrial Average is down 1.0%.