The Dow Jones Industrial Average ($DJI) had a gain of 13.32 points, or 0.12%, and closed at 11,372.48 on Wednesday. Nearly 2/3 of the Dow's 30 index components posted a gain. The financials led the gainers thanks to a steeper yield curve in bonds that is allowing them to borrow at lower, short-term rates and lend at higher, longer-term ones. Bank of America (BAC) rose 3.72%, JP Morgan (JPM) rose 2.57%, and American Express (AXP) ended the session higher by 1.90%. The weakest performers were McDonalds (MCD) (-1.99%), Boeing (BA) (-1.59%), and United Tech. (UTX) (-1.08%).
The S&P 500 ($SPX) rose 4.53 points, or 0.37%, and closed at 1,228.28. The best performers in the index were also dominated by the financials. The top gainers in the index were Lincoln Natl. (LNC) (+7.50%), First Third Bancorp (FITB) (+6.50%), Masco Corp. (MAS) (+5.82%), and Zion Bancorporation (ZION) (+5.50%). H&R Block (HRB) (-6.13%), Titanium Metals (TIE) (-4.15%), and American International Group (AIG) (-3.94%) were the biggest losers.
The Nasdaq Composite ($COMPX) ended the session higher by 10.67 points, or 0.41%, on Wednesday and it closed at 2,609.16. The top performers in the Nasdaq-100 were Foster Wheeler (FWLT), Apollo Group (APOL) (+2.92%), and Netapp Inc. (NTAP) (+2.80%). The weakest of these top 100 stocks in the Nasdaq were Cephalon Inc. (CEPH) (-3.09%), Vertex Pharmaceuticals (VRTX) (-1.99%), and Schein Henry (HSIC) (-1.73%).
Over the weekend I spent a few more minutes looking at the current action in gold. A strong daily reversal pattern was forming that I call a Momentum Reversal. This triggered early in the session on Tuesday and has continued to perform well. Gold fell $26.50 per ounce to $1,382.50 on Wednesday.
SPDR Gold Trust (GLD)
Unless otherwise stated, the index action described in this article relates to the E-mini futures contracts for the respective indices. Actual index action may differ slightly in terms of pattern formation, although the market bias will remain the same.
Toni Hansen is president and co-founder of the Bastiat Group Inc., DBA Trading From Main Street. Toni is one of the most respected technical analysts and traders in the industry. She has been trading and educating new traders, money managers, professional market analysts and traders throughout the boom and bust of the last decade. She has worked in conjunction with some of the world's top financial exchanges. Learn more about Toni Hansen and the educational services she provides through her website at http://www.tonihansen.com.