market seems quiet as per ibd, so will analyze again on 9jan09
Stocks Drift Lower In Vanishing Volume As Housing Numbers Continue To Plunge
Stocks drifted lower in sleepy trade Tuesday, as the market digested a fresh round of mostly negative economic news.
The Nasdaq slid 0.7%. The NYSE composite and S&P 500 both shed 1%, the Dow industrials 1.2%. The small-cap S&P 600 gave up 1.4%.
Volume ebbed 19% on the Nasdaq and 12% on the NYSE compared with Monday's levels.
Wall Street clocked another whisper-quiet session, with most traders already on vacation.
As noted in Tuesday's edition of The Big Picture, precedents tell us that volume will likely stay low through New Year's.
With little market movement, this is a perfect time to reset your investing strategy for 2009. In the next few days, The Big Picture will review some New Year's resolutions that will help improve your future results.
Despite the lack of stock market action, economic news continued to flow. Most of the news was negative, continuing the trend for most of 2008.
Sales of new homes fell in November to the slowest pace in nearly 18 years. Also, new-home prices registered their biggest drop in eight months.
The National Association of Realtors said sales of existing homes fell to a seasonally adjusted annual rate of 8.6% in November, to 4.49 million units.
That was below estimates for 4.93 million homes, down from a revised total of 4.91 million homes in October, and 10% lower than the November 2007 total.
The median price of an existing home sold skidded to $181,300 in November, down 13.2% from a year ago.
Industry stocks tied to real estate struggled on the news.
In other economic news, the Commerce Department reported a revised third-quarter GDP reading of -0.5%. That was the third revision made to Q3 GDP, in line with economists' views.
Consumer confidence numbers did offer cause for optimism. The University of Michigan revised its consumer sentiment index up to a reading of 60.1 from the 59.1 it announced on Dec. 12. Economists had projected a downward revision to 58.6.
Elsewhere, automakers had another tough day.
Shares of General Motors (GM) and Ford Motor (F) both dived 15%. Those declines followed Monday's warning by Toyota Motor (TM) of an operating loss next year, as well as Credit Suisse's downgrade of GM.
Leading stocks kept their losing streak alive.
P.F. Chang's China Bistro (PFCB) erased early gains, falling 1.38 to 20.22 in volume 43% above average. Analysts see the restaurant operator's earnings tumbling 39% to 27 cents a share this quarter.
Fellow restaurant chain Panera Bread (PNRA) fell 1.96 to 50.21 in rapid trade, extending recent losses. The stock is working on a deep, cup-shaped base.
Chinese stocks fared poorly, a day after China slashed key interest rates by less than expected.
AsiaInfo Holdings (ASIA) tumbled 2.23, or 18%, to 10.25 in nearly twice its normal trade.
The Chinese maker of IT security products and software was one of the day's biggest losers among small-cap stocks.
Sina (SINA), China Petroleum & Chemical (SNP) and Huaneng Power International (HNP) also fell in brisk turnover.
On the upside, Fuel Systems Solutions (FSYS) climbed 2.09 to 35.08 in above-average trading. The maker of fuel-related engine components is entering a second week of tight trading just above its 50-day moving average.
But the stock still sits 42% off its 52-week high, after a four-month correction.
In the bond market, the yield on the benchmark 10-year note was unchanged from late Monday. Lending rates such as the Libor held mostly steady.
Commodities prices continued to dip, though.
February crude oil dropped 93 cents to settle at $38.98 a barrel. Slowing economic growth around the world has triggered a plunge in demand for energy, metals and other raw materials.
Gold prices slid about 1%.
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