Yesterday, investors' focus shifted again to Europe, and especially to Italy
where a new government took over during the weekend. But the bond markets
weren't kind to the new government, and its 10-year bond rose to over 7% a
level of debt service that the country cannot sustain. As a result, Europe's
major bourses sold off by 1%, andU.S. markets followed with a loss of 0.61% on
the Dow Jones Industrial Average, 0.91% on the S&P 500, and 0.8% on the Nasdaq.
Volume was light with just 709 million shares trading on the NYSE and 375
million on the Nasdaq. Decliners outnumbered advancers on both exchanges by over
3-to-1. Click to Enlarge At first glance it looks like the technical pattern of
the Dow has not changed much in the last week. The index is still range-bound
between 11,650 and 12,200. But two changes are worth noting: 1. The index has
been able to maintain a level above the 200-day moving average while still
failing to establish a clear near-term direction.
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