Stocks opened stronger across the board but failed to follow through in a convincing manner. Within 30 minutes of the opening the market fell into a slow downside drift which led us to the lows of the day right around the lunch time hours. The major averages dropped into negative territory but managed to edge out small gains within the final 30 minutes of the session.
Once everything was set and done the Dow closed -15.87 points ( - 0.19 %) but the broader based S&P managed a small gain and closed + 2.86 points (+ 0.31 %).
It was quarterly option expiration week and this usually leads to a huge increase in trading volume and is sometimes accompanied by an increase in volatility.
Not this time around though. Volume as well as volatility was extremely low...to a point that general market conditions felt like we are heading into a major holiday.
The week was very light on economic news so there was little which could have pushed prices around in terms of important news releases. Never the less...the almost complete lack of strong market movements this week does suggest that we are beginning to see the start of the summer doldrums.
Even though the broader indices managed some gains today market action was truly unimpressive. Pretty much all of the opening gains were erased which does suggest to me that we might have a weaker opening on Monday.
I am still neutral stocks and see no real trend right now. If the Dow manages to brake 8400 to the downside we might see some momentum materializing and taking stocks lower.
Until this happens though I remain on the sidelines.
Have a nice weekend and see you on Monday,
Steve Benger
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