Small-Caps Slack on Mixed Finish


U.S. markets showed strength on the open following solid 2Q earning results and China stimulus hopes. The early morning strength lost steam as the small-caps weakened and dipped into negative territory shortly afterwards.

News that House Republicans are proposing permanent tax cuts, new retirement and savings accounts and write-offs for start-ups failed to lift spirits as the major indexes settled mixed. Volatility remains tame as it continues to hold a 3-week trading range.

The Dow rose 0.8% after trading in positive territory throughout the session while reaching a peak of 25,286. The close above 25,200 and monthly high were bullish signals.

The S&P 500 added 0.5% after making a push just south of 2,830 and a fresh July high. Continued closes above the latter would be a bullish development for a run towards 2,850 and January resistance.

The Nasdaq slipped a point, or 0.01%, despite trading to an all-time high of 7,928 shortly after the open. Support at 7,800 held for the 9th-straight session on the fade to 7,814 with a close below 7,950 signaling a short-term top.

The Russell 2000 came within 2 points of a fresh all-time high after tapping 1,706 before closing 1.1% lower. The back-test to 1,675 held near-term support with a close below 1,670 also signaling a possible short-term peak for the index.

Materials and Energy led sector strength after rising 1.3%. Health Care gained 0.7%.

Consumer Discretionary and Real Estate gave back 0.3% and were the only sector laggards.


Baker Hughes (BHGE) upgraded to Buy from Hold at SunTrust
Live Nation (LYV) upgraded to Buy from Neutral at BTIG
Werner (WERN) upgraded to Neutral from Underperform at BofA/Merrill
Gogo (GOGO) downgraded to Market Perform from Outperform at Raymond James
Hasbro (HAS) downgraded to Neutral from Buy at Monness Crespi
Whirlpool (WHR) downgraded to Neutral from Buy at Longbow


Wednesday’s earnings announcements (EST): 

Before the open: ​​Anthem (ANTM), Boeing (BA), Coca-Cola (KO), Evercore (EVR), General Dynamics (GD), Hilton Worldwide (HLT), Northrop Grumman (NOC), Rollins (ROL), Six Flags (SIX), Tupperware (TUP), United Parcel Services (UPS), Waste Management (WM)
After the close:  Advance Micro Devices (AMD), Citrix Systems (CTXS), Dolby Laboratories (DLB), F5 Networks (FFIV), Facebook (FB), Ford (F), Interface (TILE), Las Vegas Sands (LVS), Mohawk Industries (MHK), O’Reilly Automotive (ORLY), PayPal (PYPL), Qualcomm (QCOM), SJW Group (SJW), Visa (V)


Wednesday’s economic reports (EST): 

MBA Mortgage Applications – 7:00am
New Home Sales – 10:00am


Gold closed at $1225.50 an ounce, down $0.10

Silver settled at $15.52 an ounce, up $0.09

Copper finished at $2.81 a pound, up $0.06

Crude Oil is at $68.48 barrel, up $0.59

Bitcoin Investment Trust (GBTC) ended at $12.26 up $0.68

​​​Article of the Day

A bear call spread is a credit spread created by purchasing a higher strike call and selling a lower strike call with the same expiration dates.

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   Make it a great day!

   Todd Mitchell


Small-Caps Slack on Mixed Finish

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