Dow Shows Strength Ahead of a Busy Week

U.S. markets showed weakness for a 2nd-straight session while settling mostly lower to begin the week. Tensions with Iran remain elevated following fresh sanctions, while the G20 summit looms at the end of the week.

China trade relations also remain a big focus after Chinese vice commerce minister Wang Shouwen said China would like the U.S. to cancel inappropriate actions against its technology companies. Volatility stayed slightly elevated while closing slightly lower but remains in no man’s land.

The Russell 2000 led the losses for the 2nd-straight session after sinking 1.1% and closing just off its session low of 1,531. Lower support at 1,550-1,535 was breached and failed to hold with the close below the 200-day moving average being a slightly bearish signal.

The Nasdaq gave back 0.3% following the late day backtest to 8,004. Current and upper support at 8,000-7,950 held for the 3rd-straight session with a move below the latter getting 7,900-7,850 and the 50-day moving average back in focus.

The S&P 500 was lower by 0.2% after trading to a low of 2,944 ahead of the closing bell. Near-term and upper support at 2,950-2,925 failed to hold with a move below the latter signaling additional weakness towards 2,900-2,875 and the 50-day moving average.

The Dow gained 8 points, or 0.03% with the morning peak reaching 26,806. Near-term and lower resistance at 26,800-27,000 was tripped but held with the all-time high at 26,951.

Materials led sector strength after advancing 0.4% while Consumer Staples rose 0.3%. Energy was the weakest sector after falling 0.9% with Healthcare, Real Estate and Consumer Discretionary declining 0.5%.

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Dunkin' Brands (DNKN) upgraded to Outperform from Neutral at Wedbush
Hostess Brands (TWNK) upgraded to Buy from Neutral at UBS
United Technologies (UTX) upgraded to Outperform from Market Perform at Cowen

Occidental Petroleum (OXY) downgraded to Equal Weight from Overweight at Morgan Stanley
Shopify (SHOP) downgraded to Neutral from Buy at Roth Capital
Sonoco (SON) downgraded to Sell from Neutral at Goldman Sachs

Before the open: Barnes & Noble Education (BNED), FactSet Research Systems (FDS), Lennar (LEN)

After the close: AeroVironment (AVAV), AIT Therapeutics (AITB), FedEx (FDX), Micron Technology (MU), Synnex (SNX)

Tuesday's economic reports (EST): 
Redbook - 8:55am
S&P Corelogic Case-Shiller - 9:00am
FHFA House Price Index - 9:00am
New Home Sales - 10:00am
Consumer Confidence - 10:00am
Richmond Fed Manufacturing Index - 10:00am

Gold closed at $1,418.20 an ounce, up $18.10
Silver settled at $15.38 an ounce, up $0.09
Copper finished at $2.70 a pound, unchanged​
Crude Oil was at $57.84 a barrel, up $0.24
Bitcoin Investment Trust (GBTC) ended at $14.64, up $1.09

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

   Todd Mitchell

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