We head deeper into the second half of the session with the Dow Jones Industrial Average (DJIA) sitting on a low-to-high range of more than 320 points. We opened amid a flurry of selling that saw the Dow down as much as 185 points. Buyers then stepped in and rallied the DJIA to a gain of nearly 140 points. The activity has since settled down and we find the Dow more or less flat.
A look to the sector action shows many groups are mulling around breakeven. The exceptions on the upside are the SPDR Homebuilders (XHB), S&P Retail Index (RLX) and PowerShares Clean Energy ETF (PBW). The standout movers on the downside are from commodity corner. The Oil Service HOLDRS (OIH), Oil & Gas Index (XOI), and Amex Gold Bugs Index (HUI) are the weakest.
When I left the action yesterday, I was discussing how the S&P 500 (SPX), Nasdaq Composite (COMP), and Russell 2000 (RUT) were testing resistance. With that in mind, I would consider the action so far to be encouraging. We had a chance at the open for buyers to panic but we saw at least a few were willing and able to buy on weakness. The question here is how we close. In other words, will the late-morning rally hold.
Chart Courtesy of Thomson Financial
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