Bulls Snap 4-Week Slide, Bears Take August

U.S. markets

U.S. markets closed mixed on Friday as the blue-chips and S&P 500 rebounded into positive territory after being down for much of the day to extend their winning streak to 3-straight sessions. Tech and the small-caps, however, closed lower as Wall Street remained focused on developments related to the U.S.-China trade conflict as well as the outlook for the global economy.

The weekly gains ended a string of 4-straight down weeks for the major indexes but the August losses were the first monthly pullback since May. Near-term resistance and support levels held with volatility rising, giving a neutral reading ahead of the 3-day holiday weekend and the start of September.

The Dow added 0.2% after trading in a 220-point range and tapping a 1st half high of 26,514. Prior and lower support at 26,400-26,600 was reclaimed with a close above the latter and the 50-day moving average being a bullish signal for a run towards 26,750-27,000.

The S&P 500 nudged up 0.1% following opening run to 2,940 and 2nd-straight close above the 2,900 level. Current and lower resistance at 2,925-2,950 was cleared held with a close above the latter and the 50-day moving average getting 2,975-3,000 back in play.

The Russell 2000 slipped -0.1% despite testing an opening high of 1,504 but failing to hold lower resistance at 1,500-1,515. The pullback to 1,488 afterwards held upper support at 1,490-1,475 with risk towards 1,465-1,450 on a move back below the latter.

The Nasdaq also dipped -0.1% after failing to hold the 8,000 level on the morning pop to 8,017. The intraday fade to 7,914 held near-term and upper support at 7,900-7,850 with a close below 7,800 being a renewed bearish development.

For the week, the Dow was up 3% while the S&P 500 rose 2.8%. The Nasdaq was higher by 2.7% and the Russell 2000 advanced 2.3%. For August, the Russell 2000 sank -5.3% and the Nasdaq tumbled -2.6%. The S&P 500 fell -1.8% while the Dow dropped -1.7%.

Materials and Industrials paced sector leaders after rising 0.7% and 0.4%, respectively. Consumer Discretionary declined 0.6% to lead sector weakness.

The best performing sectors for the week were Communication Services and Utilities (0.7%) followed by Consumer Discretionary (0.5%) and Industrials (0.4%). Energy (-0.7%) was the leading sector laggard with Healthcare (-0.4%) and Technology (-0.3%) rounding out the losers. For August, Real Estate surged 5.4% while Energy plunged -7.6%.

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ANALYST UPGRADES/DOWNGRADES

Abercrombie & Fitch (ANF) upgraded to Hold from Sell at Deutsche Bank
Credit Suisse (CS) upgraded to Outperform from Neutral at Exane BNP Paribas
Tabula Rasa HealthCare (TRHC) upgraded to Buy from Hold at Stifel

Novo Nordisk (NVO) downgraded to Underperform from Hold at Jefferies
Ulta Beauty (ULTA) downgraded to Neutral from Buy at Citi
Toronto-Dominion (TD) downgraded to Market Perform from Outperform at BMO Capital

TUESDAY'S EARNINGS ANNOUNCEMENTS  
Before the open: Conn’s (CONN), NAPCO Security Technologies (NSSC), Tufin (TUFN), Zai Lab (ZLAB)
After the close:  Castle Biosciences (CSTL), Coupa Software (COUP), eGain (EGAN), HealthEquity (HQY), Safe Bulkers (SB)

UPCOMING ECONOMIC NEWS
Tuesday’s economic reports (EST): 
PMI Manufacturing Index - 9:45am
ISM Manufacturing Index - 10:00am
Construction Spending - 10:00am


METALS / OIL
Gold closed at $1,529.40 an ounce, down $7.50
Silver settled at $18.34 an ounce, up $0.02
Copper finished at $2.55 a pound, down $0.03
Crude Oil was at $55.16 a barrel, down $1.68
Bitcoin Investment Trust (GBTC) ended at $11.72, up $0.12


I hope this helps you prepare for the trading day. Make it a great one!


   Todd Mitchell


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