Bears Regain Momentum

The market continued its September struggle following another choppy session on Wednesday despite positive news on the corona virus vaccine front and the extension to fund the government. Johnson & Johnson (JNJ) announced it is beginning a 60,000 patient phase 3 trial which will notably feature only one dose and is expected to cost $480 million.

Better-than-expected economic news was overlooked with the major indexes giving back their opening gains while trading lower throughout the session afterwards. Tech led the pullback with the major indexes avoiding lower lows for the month, excluding the small-caps.

The Russell 2000 went out on the session and monthly low of 1,451 (-3%). Prior and upper support at 1,465-1,450 failed to hold. A move below the latter would indicate further weakness towards 1,440-1,425.

The Nasdaq ended at 10,632 (-3%) after plunging to a midday low of 10,612. Current and upper support at 10,700-10,600 was breached and failed to hold. A move below the latter would suggest further downside risk towards 10,500-10,400 and levels from late July.

The S&P 500 settled at 3,332 (-2.4%) following the late day back-test to 3,323. Prior and upper support at 3,325-3,300 was breached but held. A close below the latter would signal further downside risk towards the 3,275-3,250 area.

The Dow tagged an afternoon low of 26,716 while closing at 27,763 (-1.9%). Near-term and upper support at 26,750-26,500 was tripped but held. A close below the latter would suggest additional weakness towards 26,250-26,000.

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Nike (NKE) upgraded to Buy from Hold at Deutsche Bank
Tesla (TSLA) upgraded to Buy from Hold at Deutsche Bank
Twitter (TWTR) upgraded to Buy from Hold at Pivotal Research

American Express (AXP) downgraded to Underperform from Neutral at BofA
Discovery (DISCA) downgraded to Neutral from Overweight at JPMorgan
KB Home (KBH) downgraded to Sector Weight from Overweight at KeyBanc

Before the open:  Accenture (ACN), BlackBerry (BB), CarMax (KMX), Darden Restaurants (DRI), FactSet Research Systems (FDS), Jabil (JBL), NetSol Technologies (NTWK), Rite Aid (RAD), Supreme Cannabis (SPRWF)

After the close: Aytu BioScience (AYTU), Costco Wholesale (COST), Research Solutions (RSSS), Scholastic (SCHL), Group (TCOM), Vail Resorts (MTN)

Jobless Claims - 8:30am
New Home Sales - 10:00am
Kansas City Fed Manufacturing Index - 11:00am

Gold closed at $1868.40 an ounce, down $39.20
Silver settled at $23.10 an ounce, down 1.42
Copper finished at $2.99 a pound, down $0.07
Crude Oil was at $39.49 a barrel, down  $0.06

Bitcoin Investment Trust (GBTC) ended at $10.61, down $0.66

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

   Todd Mitchell

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