(By Rich Bieglmeier) Wednesday's trading was nearly Tuesday in reverse. The NASDAQ opened Tuesday at 2,815, hit a high of 2,843, a low of 2,802 and closed at 2,843. Wednesday started at 2,838, had a high of 2,853, a low of 2,810 and closed at 2,818, just 3 points away from Tuesday's open.
Oh, and Wednesday's close puts stocks essentially where they finished up Monday, 2,809
Tuesday's green volume of 1.6 billion shares was displaced by Wednesday's 1.6 billion red shares. Now, that's what you call trading in a circle. Thursday's an even numbered day, so that means stocks head higher again. See how that works? Just like the mid-70s gas lines.
All joking aside, yesterday's limp action was news driven with the Retail Sales report showing a weaker consumer than expected; although, the report's headline number was on target.
After the closing bell, news that Moody's cut its rating on Spanish government debt by three notches to Baa3 from A could carry stocks down overnight into Thursday's opening bell.
In addition to the downgrade news, Jobless Claims will be the other item that gives stocks a lift or adds to the letdown. The polled economists believe 375,000 people requested initial unemployment benefit checks last week, with a range of 370k to 385k. iStock expects to see a result close to the rolling four week average of 377,750, which is slightly more than forecasted, but probably not high enough to damage equity indexes all that much, maybe a few dents.
The technical case is a simple one for investors to eyeball, does the NASDAQ burst through its 26-day average (2,858), signaling a journey to the 50-day average, before it closes below 2,800, putting a test of May's pivot lows in play.
Those are the guardrails for now. iStock will be watching intently to see which guardrail Wall Street smashes beyond first. Until then, it is probably more of the same, the spin cycle. We just aren't sure if the algorithms are squeezing out sellers or buyers in the rinse.