After three straight days of steady, intraday trends (2 down and 1 up), stocks began the month of November with a session of indeterminate chop. Early strength enabled the major indices to briefly reclaim about half of the previous day's losses, but the bears resumed control at mid-day, causing stocks to erase their initial gains. A modest wave of buying in the final ninety minutes of trading enabled the main stock market indexes to finish in positive territory, but only near the middle of their intraday ranges. The Dow Jones Industrial Average gained 0.8% and the S&P 500 advanced 0.7%. However, the Nasdaq Composite edged just 0.2% higher. The S&P Midcap 400 finished 0.5% higher, but the laggard small-cap Russell 2000, which is already trading below its prior "swing low" from early October, was merely unchanged.

Unfortunately for the bulls, lighter volume prevented yesterday's gains from having the "punch" of institutional buying. Total volume in both the NYSE and Nasdaq was 6% lighter than the previous day's levels. Decreasing volume is commonplace during indecisive, non-committal sessions. In both exchanges, advancing volume was nearly on par with declining volume, indicating the bulls did not convincingly have the upper hand, despite the moderate percentage gains of the broad market.

In yesterday morning's commentary, we discussed the importance of the major indices holding above critical support of their prior "swing lows" from early October. The Nasdaq was the only index that had marginally set a "lower low" on a closing basis last week, though it grudgingly edged back above its early October low yesterday. Perhaps the biggest drag on the tech-heavy Nasdaq has been the poor performance of the Semiconductor Index ($SOX). While most industry sectors are still above their prior "swing lows," the $SOX plunged through its October 2 low last week. Since the sector is heavily weighted within the Nasdaq, this has undoubtedly been a drag on the index:

Though the S&P and Dow are still above their early October lows, the extremely weak performance of the Banking Index ($BKX) has been a drag on those indexes. Like the $SOX, the $BKX has been an anchor around the broad market's feet:

If the stock market attempts to rally again in today's session, keep an eye on the performance of these two industry sectors or related ETFs (SMH for semiconductors and KBE for banking).