The Market Direction…

>>>Market Condition Analysis>>> Intel (INTC) passed the earnings spotlight baton to JP Morgan Chase (JPM) and it did not disappoint investors as it reported recored revenue @ $27.7bn and generated 2Q-2009 EPS @ $0.28 vs. consensus estimates @ $0.04. Like Goldman Sachs, the Darwinian natural selection process of the financial crisis gives JPM a competitive edge over its industry peers. However, it’s stock closed down as it cited deteriorating consumer credit conditions in the future.

Technology has been leading this market and drove today’s trading session with 25 of its sector members representing Thursday’s top 100 performers in the S&P 500. Notable standouts in terms of market cap weightings and performance were IBM, Intel, and Hewlett Packard.

Volume was relatively unchanged on both exchanges: NYSE volume -1.87% below average and Nasdaq Composite volume -3.22% below average.

For Thursday’s trading session, price volume analysis shows investors may have been inclined to book profits ahead of the weekend. @ 53% of the Russell 3000 components were up on declining volume

Economic indicators still mixed

Jobless claims showed substantial improvement, due to seasonal adjustments, with @ -47k drop by reporting 522k vs. consensus estimates @ 535k. The 4 week average also declined to 584.5k. Continuing claims also fell -642k to 6.273mm.

The TIC (Treasury International Capital) report for May 2009 showed @ -19.8bn drop in purchases of U.S. securities. Despite its political rhetoric, China continues to support the U.S. with increased purchases while Japan and Russia’s investments in U.S. securities declined.

The Philly Fed Survey for manufacturing contracted to -7.5 in July-2009 vs. -2.2 in June-2009.

Home Builders sentiment improved to 17 in July-2009 which is its best reading since September 2008. However, any number less than 50 still indicates unfavorable market conditions.

Large Cap bellweather stocks scheduled to report earnings on Friday are the following: Consumer Discretionary (MAT); Conglomerates (GE); lndustrial Products (BMS); and Finance (BAC; BBT; C; FHN; MI; TROW).

Market Summary

The DIA closed up +1.21% @ $87.23 and $0.27 below its high and $1.20 above its low. Volume  was -14% below average volume. Daily PMI* is @ 81.63 and weekly PMI* is @ 95.83.

The SPY closed up +0.97% @ 94.15 and $0.23 below its high and $2.60 above its low. Volume was +7% above average volume. Daily PMI* is @ 91.17 and weekly PMI* is @ 95.94.

The QQQQ closed up +3.36% @ 36.92 and $0.04 below its high and $0.75 above its low. Volume was +38% above average volume. Daily PMI* is @ 98.73 and weekly PMI* is @ 99.59.

The IWM closed up +3.85% @ 51.62 and $0.16 below its high and $1.20 above its low. Volume was +24% above average volume. Daily PMI* is @ 88.24 and weekly PMI* is @ 96.27.

(*PMI measures and indicates strength of the underylying security’s trading range on a scale of 1-100.)

Industry Summary–> Positive: 184; Negative: 25; Unchanged: 0

Leading Industries: air delivery & freight service; semiconductior memory chips; processing systems & products; resorts & casinos; appliances; recreational vehicles; hospitals; nonmetallic mineral mining; agricultural chemicals; entertainment diversified

Lagging Industries: lodging; communication equipment; reit-hotel/motel; surety & title insurance; investment brokerage-national; regional mid-atlantic banks; accident & health insurance; toy & hobby stores; beverages-wineries & distill; regional airlines

Volume Movers

Stocks Moving Up on Surging Volume

• Large Caps: JNS; HOG; SNDK; PPG; FDX; WHR
  

• Mid Caps: PLCM; RGS; ADTN; ADS; CBSH
  

• Small Caps: KLIC; UFPI; HR; Y; CHE; EWBC; SMP; TTWO; ATO
  

Stocks Moving Down on Surging Volume

• Large Caps: CIT; AIG; XLNX; MAR; CTAS
  

• Mid Caps: FCS; RFMD; HE; IMN; SGMS
  

• Small Caps: CELL; CPF; ADPT; MTEX; GY; UCBH; TLEO; SKY; PEET; VIVO
  

Market Trend Analysis

Market Momentum (% of Stocks Above Moving Averages)

Technical Support & Resistance Levels for July-17-2009

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