1:00pm (EST)
The market is down significantly today as the major averages are near session lows with losses of well more than 2%. Fasten your seat belts, folks, because the volatility is reaching a boiling point and we could be going on some wild price swings.
Futures were already pointing towards a triple-digit loss for the Dow and we got that at the open and then some. Wall Street seems nervous about continued worries over the spread of the debt crisis in Europe today. Once again, the reaction has been extreme which has caused some panic selling but we still remain in our trading ranges.
Today’s drop is a little harsh because Spain’s government said that they aren’t in need of a bailout. However, protests have erupted throughout Greece against the spending cuts the country has promised to make. Greece has said they will slash public spending by $40 billion to secure the bailout loans. How did the public react? A general strike has been called for on Wednesday.
We did get some good economic news this morning although the numbers were a little fluffed as pending home sales came in better than expected.
The National Association of Realtors said its index of sales agreements for previously occupied homes rose 5.3% in March. Some of this was due to the rush to take advantage of the federal tax credit for home buyers.
Elsewhere, the Commerce Department said orders to U.S. factories rose 1.3% in March. The pencil pushers were expecting a drop.
As a result, the Dow is currently down 280 points, or 2.5%, to 10,872 while the S&P is off by 33 points, or 2.8%, and was last seen at 1,168. Meanwhile, the Nasdaq is taking a pounding as it is down 86 points, or 3.5%, and is at 2,412.
One company bucking the trend is NutriSystem (NTRI, $22.50, up $4.00) which is up over 20% today despite declining revenue and earnings. The company beat Wall Street’s estimates by reporting a profit of $4.8 million, or $0.15 a share, versus $8.8 million, or $0.29 a share, in the year ago quarter. Analysts were expecting earnings of 12 cents a share.
As we look towards the afternoon session, we will be watching for the market to hold key support levels which we went over this morning. Despite the gloom and doom our portfolio is doing well as we have been closing out our call options trades by scaling into a few put option positions. Subscribers, check the Members Area for the updates.
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