Futures were slightly down for much of last night and the headlines from overseas were relatively quiet but negative. China reported its manufacturing Purchase Manager’s Index for June fell to 48.2 which was lower than May’s reading of 48.4. We thought there would be a bigger reaction because most traders don’t trust China’s numbers on anything but a reading below 50 shows contraction.
Here at home we said today’s economic news could play a role in today’s action and here were our thoughts in the Weekly Wrap last night on the ISM Index:
“The suit-and-ties are looking for ISM to come in at 52.2 but we are expecting 51. A print below 50 would be a disaster for bulls.” (END)
The Institute for Supply Management (ISM) came in at 49.7 for June, down from 53.5 in May. It was the lowest reading since mid-2009 and Wall Street didn’t like it. The talking heads seem “surprised” and many of the bullish traders from Friday are now saying to take some risk off the table. Imagine that.
The bulls needed a big pop at the open to keep Friday’s momentum going and they are so close to a breakout but today’s action favors the bears.
They Dow is down 60 points to 12,820 while the S&P 500 is off 5 points to 1,358. The Nasdaq is slipping a point and is at 2,934.
The bears are targeting a Dow close below 12,800 and are pushing for the S&P to finish under 1,355-1,350.
Subscribers, check the Members Area for the updates.