Bears Regain Momentum

Value Stocks

Wall Street rebounded on Wednesday despite a choppy open as mildly positive factory data fueled sentiment. Specifically, industrial production increased 0.4% in August, slightly beating estimates. Additionally, capacity utilization rose to 76.4% from 76.2% while manufacturing edged up 0.2%.

The gains helped push the major indexes back into positive territory for the week. Meanwhile, volatility settled lower after holding a key level of resistance for the second-straight session.

The Russell 2000 tested a high of 2,236 while ending at 2,234 (+1.1%). Lower resistance at 2,225-2,250 and the 50-day moving average were recovered. A close above the latter would be a bullish development for another run towards 2,275-2,300. Below is a chart of the IWM.

The S&P 500 closed at 4,480 (+0.9%) with the afternoon peak kissing 4,486. Current and lower resistance at 4,475-4,500 was cleared and held. A move above the latter would signal a possible trip towards 4,525-4,550 with the beginning of the month all-time high at 4,545.

The Nasdaq tagged a high of 15,174 after briefly falling below the 15,000 level before finishing at 15,161 (+0.8%). Near-term and lower resistance at 15,100-15,250 was reclaimed. A close above the latter keeps upside towards 15,350-15,400 in play with the recent record peak at 15,403.

The Dow tapped an intraday high of 34,880 while settling at 34,814 (+0.7%). Lower resistance at 34,750-35,000 was cleared and held. A close above the latter and the 50-day moving average would suggest a near-term bottom with further strength towards 35,250-35,500.

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Alcoa (AA) upgraded to Buy from Hold at Argus
Bio-Techne (TECH) upgraded to Overweight from Sector Weight at KeyBanc
Sea Limited (SE) upgraded to Buy from Hold at Stifel

Evergy (EVRG) downgraded to Neutral from Buy at BofA
Itamar Medical (ITMR) downgraded to Neutral from Buy at Ladenburg
Kansas City Southern (KSU) downgraded to Peer Perform from Outperform at Wolfe Research

Before the open: ​None

After the close: None

Jobless Claims - 8:30am
Retail Sales - 8:30am
Philadelphia Fed Business Outlook Survey - 8:30am
Business Inventories -10:00am

Gold closed at $1,794.80 an ounce, down $12.30
Silver settled at $23.80  an ounce,  down $0.09
Copper finished at $4.41 a pound, up $0.09
Crude Oil was at $72.64 a barrel,  up $1.87
Bitcoin Investment Trust (GBTC) ended at $38.81  up $1.99

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

 Todd Mitchell

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