U.S. markets closed Wednesday’s session at their lowest levels since August as a weaker-than-expected report on private employers' hiring stoked ongoing fears that economic growth is slowing. Technical indicators also played a major role in the overall weakness with the major indexes testing key support levels and round psychological numbers.
Volatility rose to its highest levels in a month and is confirming additional risk for the market with a number of major economic reports due out the rest of the week.
The S&P 500 stumbled 1.8% after tapping a 2nd half low of 2,874. Prior and upper support at 2,875-2,850 was breached but held with a move below the latter and the 200-day moving average signaling additional weakness towards 2,825-2,800.
The Dow skidded 1.9% after tapping an intraday low of 25,974. Major support at the 26,000 level was breached but held with a close below 25,800 and the 200-day moving average opening up risk towards 25,600-25,400.
The Nasdaq sank 1.6% following the midday back-test to 7,744. Late August and upper support at 7,750-7,700 held with a close below the latter and the 200-day moving average getting 7,650-7,600 in focus.
The Russell 2000 gave back 1% following the intraday plunge to 1,469. Early September and lower support at 1,480-1,470 was stretched but held with a move below 1,465 getting the late August low at 1,450 in play.
There was no sector strength for the 2nd-straight session. Energy was the weakest sector after tanking 2.5%, while Financials and Consumer Staples fell 2%.
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Carter's (CRI) upgraded to Buy from Neutral at DA Davidson
Spotify (SPOT) upgraded to Neutral from Underperform at Credit Suisse
Tractor Supply (TSCO) upgraded to Buy from Neutral at Northcoast
Activision Blizzard (ATVI) downgraded to Underperform from Market Perform at Bernstein
Charles Schwab (SCHW) double-downgraded to Underweight from Overweight at Barclays
Monster Beverage (MNST) downgraded to Neutral from Buy at Guggenheim
THURSDAY'S EARNINGS ANNOUNCEMENTS
Before the open: AngioDynamics (ANGO), Constellation Brands (STZ), PepsiCo (PEP)
After the close: Aehr Test Systems (AEHR), Ascena Retail Group (ASNA), Costco Wholesale (COST), IDT (IDT), Smart Global Holdings (SGH)
UPCOMING ECONOMIC NEWS
Thursday's economic reports (EST):
Challenger Job-Cut Report - 7:30am
Jobless Claims - 8:30am
PMI Services Index - 9:45am
ISM Non-Manufacturing Index - 10:00am
Factory Orders - 10:00am
METALS / OIL
Gold closed at $1507.90 an ounce, up $18.90
Silver settled at $17.30 an ounce,