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After The Close - The stock market got off to a weak start this morning, and sank further into negative territory in the afternoon. Traders seemed worried about the global economic outlook, and may also be concerned that a trade deal between the U.S. and China could be delayed. Furthermore, the details of any potential agreement have not been revealed, and this may be creating some uncertainty. At the close of today’s session, the Dow Jones Industrial Average was down 133 points; the S&P 500 Index was off 18 points; and the NASDAQ was lower by 70 points. The tone was negative, as losers outnumbered winners by a wide margin on the NYSE and on the NASDAQ. All of the major equity groups retreated. The healthcare and basic materials issues declined notably, while the defensive utility names held up a bit better.

There were a few economic items released this morning. According to Automatic Data Processing (ADP) 183,000 private sector jobs were added to the economy in the month of February. While this figure was respectable, it was lower than the January number and a bit below expectations. It is possible that this issuance has some traders worried about the monthly employment report slated to be released on Friday morning.

Elsewhere, the nation’s trade deficit widened to over $59 billion in December, and this news did little to help market sentiment.

In the corporate arena, shares of Abercrombie & Fitch (ANF) moved sharply higher, after the apparel retailer delivered a favorable report. Meanwhile, shares of General Electric (GE) slumped today, after the struggling industrial giant provided a weaker-than-expected financial forecast.

Technically, the stock market has pulled back over the past few sessions. At this point, it seems that traders are in need of some direction, especially now that the fourth-quarter earnings season has passed. – Adam Rosner

At the time of this article’s writing, the author had a position in General Electric.

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Before The Bell - After a late-recovery on Monday helped to blunt what had been a sharp early month retreat, Wall Street started yesterday's session with a slight bias to the downside after a choppy and mostly indecisive pre-market showing by the equity futures. However, stocks soon fell a bit more precipitously as the morning progressed, with the Dow Jones Industrial Average falling to an early morning deficit of close to 100 points. The other indexes, too, eased into the red. As before, though, this decline would prove to be a fairly brief sojourn into the minus column.

In fact, as the morning drew to a close, the three major large-cap indexes were either in positive territory or knocking on the door. The smaller indexes, however, were still off in morning dealings. The stock market slipped, initially, as traders continued to monitor talks between the United States and China on trade, the major issue at hand now that earnings season is over. Key Administration spokespersons have claimed that a deal on trade soon will be forthcoming. The consensus is that a formalized accord will take hold later this month.

The feeling is that a satisfactory trade deal would be positive for corporate earnings. That would explain the Street's preoccupation with reaching an agreement. On Monday, there was some consensus emerging that a good trade package was already factored into the market. That was one reason for the pullback. By yesterday, though, sentiment seemed a little better as the morning ended and the afternoon began. In fact, this somewhat more positive sentiment helped equities to a mixed showing as we passed the halfway point of the second trading day of the week.     

Meantime, in economic news, the Institute for Supply Management reported that its survey on non-manufacturing produced a solid expansion in November, with its survey climbing to an expansionary 59.7 from 56.7 in January. Growing in the months were new orders, inventories, and backlogs. It was the 109th consecutive month of growth (i.e., a survey result of better than 50.0) for this important economic sector. The better services figures helped the market to enter and then largely stay in the plus column through much of the rest of the afternoon.    

The market then meandered about during the remainder of the session, with the large-cap indexes generally staying modestly in the plus column until the final minutes of the session, before ending matters with small losses. It seems that hope finally topped actual results. Thus, as we head into the middle of the trading week, the stock market is holding aggregate two-day losses, with weakness more pronounced in the mid- and small-cap arenas. All told, the Dow would end matters off 13 points; the S&P 500 Index would lose three points; and the NASDAQ would conclude with a bare one-point decline.

Looking out upon a new day now and, for the bulls continuing hope that we are that much closer to some sort of trade deal with China, we see that the major indexes were mostly higher in Asia overnight, while in Europe, the leading bourses are generally mixed. Also, oil prices are easing in early dealings on an inventory build; Treasury note yields, which were flat yesterday, ending at 2.72%, are now at 2.70%; and U.S. equity futures are suggesting a weaker opening when trading resumes.  - Harvey S. Katz, CFA 

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.