After The Close - Wall Street hit the pause button today after rallying for much of the week’s first three trading days, and engaged in some modest profit-taking. From Monday to Wednesday, the Dow Jones Industrial Average had rallied over 400 points, or 2.7%, with every day seeing a 100-plus point gain. The advance lifted that venerable index back above the 15,000 level.

At the close of today’s session, however, the Dow had turned in a 26-point loss and the NASDAQ was in the red by nine points. The broader market was clearly weak, with declining issues easily outpacing gainers on both the New York Stock Exchange and the NASDAQ.

The problem for investors was the lack of a catalyst. The upbeat tone earlier in the week was set by the deferral of military action in Syria, in the hope that diplomatic initiatives would instead be relied on to properly address the situation. But the positive feeling provided by that backdrop appears to have run its course.

What little there was of the day’s economic data offered scant assistance.  The Labor Department reported this morning that the week’s initial unemployment claims came in lower than expected, but it turned out that two states under-reported their figures, owing to computer systems being converted, making the data less useful.

Among the stock market’s various sectors, shares of basic materials companies were the day’s laggards, notably those of gold producers. The price of gold fell $40 an ounce today, or about 3%, pressuring the stocks of gold miners, such as Barrick Gold (ABX) and Newmont Mining (NEM).

Elsewhere, bond prices held steady for the most part on a lack of news, although oil prices rose over $1 a barrel in New York trading on prospects for improved demand.

Among individual issues, Valero Energy (VLO) dropped after the oil refiner reported at a conference that some projects would be delayed and 2014 spending plans would be at the high end of their expected range.

For the most part, although today’s broader market trading was unenthusiastic, no especially dispirited tone was on display. 

The pace could pick back up tomorrow, with a slew of economic data on tap. Reports due out on Friday include figures for August on retail sales, the Producer Price Index, and business inventories. There is also a consumer sentiment index for September due to be released. Of the bunch, the retail sales number may carry the most weight, given the consumer’s importance to the economy.   - Robert Mitkowski

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


12:35 PM EDT - The U.S. stock market has been a bit volatile thus far today. At just past noon in New York, the Dow Jones Industrial Average is off 35 points; the broader S&P 500 Index is lower by six points; and the NASDAQ is down by eight points. Market breadth suggests a mixed tone to the session, too, as declining issues are slightly ahead of advancers on the NYSE and the NASDAQ. Still, almost all of the market sectors are in negative territory, and that suggests that there are limited pockets of strength today. The technology area is making some progress, and there is some relative strength in the healthcare stocks. However, there is considerable weakness in the basic materials issues, while the financials are trading lower, overall.

Technically, the stock market has recovered from its August pullback. The NASDAQ, has outperformed the Dow and the S&P 500 Index over the past several weeks. This may suggest that investors, concerned with rising interest rates, have been rotating into the more rapidly expanding growth issues. For example, the biotechnology stocks have done quite well lately. This is a positive, as it suggests that speculative sentiment is still operating. The market was also getting some help from the basic materials issues, and that may be due to decent news out of China, and the fact that many of these stocks, particularly in the metals and mining areas, were badly bruised earlier.

The economic news was generally positive today. Specifically, initial jobless claims declined to 292,000, which was lower than the 323,000 figure posted in the prior week, and also below what analysts had expected. Continuing jobless claims also improved, further supporting the idea that the employment situation is on the mend. In addition, there is little hint of inflation looming on the horizon, as both import and export prices declined in August. While these reports were positive, it is possible that traders, watching the Fed for signs of a tapering in its asset purchase program, are a bit concerned.  We will get more information here by the middle of next week when the FOMC meets, and issues a rate decision and some accompanying remarks.

In the corporate arena, there were a few reports released this morning that bear mentioning. Shares of Men’s Warehouse (MW) are trading sharply lower after the clothing retailer released disappointing quarterly sales and profits. Further, Wall Street was not impressed with that company’s outlook. In technology, Pandora Media (P) stock, which has staged a sharp runup over the past several months, is rising further, as the Internet music provider has announced a new CEO.

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

Stocks to Watch from The SurveyThere is some earnings news out of the retail sector. lululemon athletica (LULU) delivered July-period earnings that topped our forecast, but the seller of athletic clothing and accessories offered a forward-looking outlook that was weaker than expected. It was a similar situation at The Men’s Wearhouse (MW), although that company reported July-period earnings that were weaker than forecast in addition to providing a disappointing outlook. Consequently, the two equities are trading notably lower ahead of the bell, with MW shares showing greater weakness. Elsewhere, shares of Pandora Media (P) are moving higher in pre-market trading, after the Internet radio provider announced that it has found a new CEO, Brian McAndrews, to replace the outgoing CEO, Joe Kennedy. Finally, the stock of Extreme Networks (EXTR) is indicating a sharply higher opening this morning, on news that the provider of switching solutions has acquired industry peer Enterasys Networks for $180 million in cash. – Matthew E. Spencer

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

Before The Bell - The stock market extended its latest winning streak yesterday, albeit selectively, with the Dow Jones Industrial Average up strongly throughout the session, with the Standard and Poor's 500 Index holding near the neutral line until a late buying burst allowed it to gain a handful of points, and with the tech-heavy NASDAQ being off modestly for the bulk of the day, before ending lower by just four points. 

To an extent, it was a tale of two stocks, on what was the most somber of days, as we marked the 12th anniversary of the horrific attacks on our nation. One of these stocks was on the Big Board and the other on the NASDAQ.  Specifically, IBM (IBMFree IBM Stock Report), a high-priced equity and a component of the Dow, led the charge higher for that blue-chip index, on word that it was selling a unit for more than $500 million. In all, the issue gained almost four points. On the other hand, there was some disappointment over the high price for a new version of the Apple (AAPL) iPhone 5 being sold overseas. Apple shares tumbled for a second day in a row, losing just under $27 a share. The respective performances contributed mightily to the 136-point rise in the aforementioned 30-stock blue-chip index and the slight setback on the NASDAQ.

In individual areas, most equity groups gained ground, although there was some slippage in the fertilizer stocks, which have been under pressure for some weeks now. Other basic materials groups, including the steels, mining, and aluminum issues, held up well. Overall, gaining stocks edged out losing issues on the Big Board by almost a four-to-three margin, while losers held a narrow lead on the NASDAQ.

Elsewhere, there continued to be relief that this nation was not about to launch a military strike against Syria, an outcome that would likely have pushed oil prices up further, and put unwanted pressure of the world's economies, at a time when such economies are either stabilizing or starting to rebound. Comments from the White House that the President was willing to give diplomacy a chance helped lessen the tension on Wall Street, following the skittishness of last week.

Our sense is that such global events would have taken center stage in any event on such a week. However, with earnings season comfortably in the rear view mirror, with economic news sparse until tomorrow, with the Federal Reserve's next monetary meeting still almost a week away, and with the debt-ceiling debate in Washington yet several weeks down the road, the focus on overseas developments has been even greater than it might otherwise be--and to Wall Street's benefit this week.

As to these other issues, which will, undoubtedly, help to guide equity market behavior in the days and weeks to come, the economy looks to be on a moderate, but durable, forward course at home and on an irregularly better path abroad; the Fed is likely to start to taper its popular bond-buying program sooner rather than later--and perhaps as early as next week; and the situation in Washington is likely to become even more contentious in the weeks before a mid-October debt-ceiling deadline draws near. Thus, there will be plenty of opportunity, we believe, to test the mettle of the suddenly emboldened bulls.

For now, though, the path to higher stock prices would seem to be relatively clear, at least in the very short run, although we caution that valuations are again getting frothy and the VIX volatility index has been tracking lower again, having fallen below 14 yesterday, suggesting that speculative activity is again on the rise. Such a state of affairs proves often bearish at some point.      

Looking ahead, meantime, stocks overseas were mixed in Asia overnight, and were little changed in Europe earlier this morning. And over here, our futures are a bit softer at this hour possibly presaging a weaker start when trading commences in less than an hour from now. The lone economic news item of note today was the report, issued moments ago, showing a plunge in initial jobless claims to 292,000 in the latest week. That result was well under the expected 330,000 claims, and could encourage the Fed to go forward with its possible reduction in bond-buying activity next week. – Harvey S. Katz

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