E-mini stock index traders focus on earnings

S&P 500 (Figure 2)

Although the market initially reacted with selling off premarket highs into the open and slightly beyond, the larger 15 minute trading range broke higher around 10:30 a.m. ET. The market then continued to climb throughout the remainder of the morning. The rally peaked heading into noon, which is a typical reversal period intraday. The price level at this point also corresponded to the measured move levels in the ES and NQ on the 15 minute time frame when the rally following the open is compared to the early-morning move. This is shown in blue in Figures 2 and 3 and is a strong resistance zone.

The Nasdaq faced the largest correction off mid-day highs. It pulled back into its opening price zone before finding support coming into the 14:00 ET correction period. Although the index recovered some of the loss ahead of the close, prices fell following the bell thanks to Amazon.com (AMZN). The online retailer reported an increase in revenue of 38%, but its earnings per share fell short of analysts' expectations.

Nasdaq Composite (Figure 3)

The Dow Jones Industrial Average ($DJI) ended the day a gain of 115.49 points, or 0.93%, and closed at 12,595.37 on Wednesday. Twenty-four of the Dow's thirty index components posted a gain. The top performers were Caterpillar (CAT) (+2.84%), Intel (INTC) (+2.46%), Cisco Systems (CSCO) (+2.46%), and Microsoft (MSFT) (+2.26%). The weakest were Bank of America (BAC) (-1.69%), Coca-Cola (KO) (-1.20%), and Home Depot (HD) (-0.93%).

The S&P 500 ($SPX) rose 11.99 points, or 0.9%, and closed at 1,347.24. The strongest percentage performers in the index were Waters Corp. (WAT) (+8.37%), Cummins Inc. (CMI) (+7.57%), AK Steel Holding Corp. (AKS) (+6.40%), and Illinois Tool (ITW) (+6.10%). The weakest were Lexmark Intl. (LXK) (-14.44%), Tellabs Inc. (TLAB) (-9.09%), Netflix (NFLX) (-9.04%), and Autonation Inc. (AN) (-4.35%).

The Nasdaq Composite ($COMPX) ended the session higher by 21.66 points, or 0.77%, on Wednesday and it closed at 2,847.54. The strongest performers in the Nasdaq-100 were Vertex Pharmaceuticals (VRTX) (+10.16%), Sigma Aldrich Corp. (SIAL) (+4.64%), Research In Motion (RIMM) (+3.29%), and Sears Holdings (SHLD) (+3.10%). The weakest were Netflix (NFLX) (-9.04%), Express Scripts Inc. (ESRX) (-2.20%), Alexion Pharmaceuticals (ALXN) (-1.92%), and Amazon.com (AMZN) (-1.68%).

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