The market sold off today. The major averages opened lower and after a rally attempt sold off again into the close. All the major averages finished low in their intraday trading ranges. The Nasd averages were the weakest with the COMPQ and the NDX falling 1.25% and 1.55% respectively. The SPX fell .66%. There was some outperformance in the mid-caps and semiconductor stocks. Volume was lower across the board. It fell 8.24% on the New York and 4.84% on the Nasd. This shows that large institutional players were not selling stocks heavily. Leading stocks on the other hand were higher on the day. The leaders index gained 2.61% and closed just below the midpoint of its trading range. Volume was higher and well above average. It was the highest volume in almost two months. The overall market was weak today. The major averages tried to rally after opening lower but couldn’t hole the rally. Selling came in and they closed near their lows. The lower volume means all the major averages avoided a distribution day and showed that there was not great selling pressure today. The real item of the day was the strength in quality growth stocks. The leaders index powered higher and made a new high on both a closing and an intraday basis. The relative strength line also made a new high. The strong volume showed accumulation in leading stocks. The good action in leading stocks would suggest that the current rally is not over. The market usually doesn’t get into to much trouble when quality growth stocks are leading the way. The market will likely try to work its way higher in at least the short term. Jerry
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