US Stock Indexes Finished Sharply Lower, Volume Moderate

US Stock Indexes Finished Sharply Lower, Volume Moderate


DJIA -350.33 at 17596.69, NAS -122.04 at 4958.47, S&P 500-43.85 at 2057.76

Volume: Trade was moderate to above average with 853-M/shares changing hands on the NYSE 

Breadth: Decliners outpaced advancers by a 10-to-1 margin

Volatility: VIX (NYSEArca:VVX) the CBOE fear gauge finished at 19.20, +5.18, +37.0%, a huge move as participants sought hedges to protect against Southside risk

Greek leaders said ‘no’ to the Eurogroup’s cash-for-reform proposal and investors around the world in turn said ‘no’ to buying stocks on Monday. Just about every major market closed down at least 2.0%.

The hardest-hit stock markets were the European exchanges, which included Germany’s DAX Index (-3.6%) and Spain’s IBEX (-4.6%). Japan’s Nikkei dropped 2.9% while China’s Shanghai Composite fell 3.3% despite the PBOC’s cutting its benchmark lending and deposit rates by 25 bpts each to 4.85% and 2.00%, respectively.

The US stock indexes saw broad-based selling, the S&P 500 declined 2.1% as buyers wanted no part of Monday’s action.

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SPDR S&P 500 ETF Trust (NYSEArca:SPY) 205.47, -4.35 was the heaviest it has seen since 17 April.

The utilities stock sector (-0.6%) was the out performer in the weak stock market.

US Treasury Complex attracted safe-haven flows. The 10-yr T-Note surged more than a point and saw its yield drop 15 bpts to 2.33%.

US Dollar (.DXY) Index fell 0.6% to 94.87.

WTI Crude Oil (NYSEArca:USO) prices fell 2.3% to 58.32 bbl as demand concerns tied to the macro situation weighed.

The financial stock sector (-2.4%) got hit hard, as Greek contagion concerns and a flatter yield curve got the better of the stock sector, which had been outperforming in recent weeks on curve steepening and the thinking Greece and its creditors would strike an 11-hr solution.

The materials stock sector (-2.4%), healthcare (-2.3%), consumer discretionary (-2.3%), and information technology (-2.2%) sectors were down on the day.

Every stock in the DJIA lost ground Monday

Goldman Sachs (NYSE:GS) 207.65, -5.52) the highest-priced stock in the price Dow index.

With Monday’s retreat, the DJIA fell below its 200-Day MA. The S&P 500 stands less than 10 pts above that Key support after closing on its lows and turning negative for the year (-0.1%).

Economic data

Pending Home Sales report for May disappointed with a 0.9% increase (consensus +1.4%).


Greece will continue to be the focus. US data will include the Case-Shiller 20-City Home Price Index for April (consensus +5.6%; prior +5.0%), the Chicago PMI for June  consensus 50.0; prior 46.2), and the June Consumer Confidence report (consensus 97.5; prior 95.4).

Stay tuned…


Paul Ebeling


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