Leaders Index 5-12-20

The market had a pretty nasty selloff today. The major averages opened higher and after some nice gains in the Nasd averages they mostly worked their way lower. Heavy selling in the last hour saw all the major averages close at their intraday trading lows. The damage was pretty evenly divided with the COMPQ and the NDX falling 2.06% and 2.01% respectively. The SPX was lower by 2.05%. Volume was higher across the board. It rose 14.53% on the Nasd and 8.91% on the New York. This represents distribution on all the major averages and shows that large institutional players were selling stocks today. Leading stocks were hit hard today as well with the leaders index off by 2.94% on the session. The index closed near the bottom of its trading range on lower and below average volume. This shows that there was not heavy selling pressure in quality growth stocks. The market had its first real distribution day in quite a while. There was weakness most of the day but a lot of selling in the last hour. This is usually not a positive sign. There were reports that much of the selling was brought on by testimony in the Senate and a report a higher deaths from Covid19. Either way there was real institutional selling today, as can be seen in the elevated volume levels. This was however the first day of real distribution we have seen in a while and the distribution count is only one. The selling was pretty strong but the charts of the major averages and the leaders index still look good. The damage was limited. As of now the futures are a little lower but this could and probably will change before the open tomorrow. This type of day isn’t fun, but it doesn’t change the overall picture. Jerry