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Stocks finished lower on Thursday, marking the largest intraday decline since December 28, 2011. Major indices started the day gaining following a successful Italian bond auction and positive sentiment spillover from yesterday’s Fed announcement in which the FOMC announced “exceptionally low rates through at least 2014.”
Stocks looked poised to continue the march higher until two U.S. December economic reports were released. Both the December New Home Sales and December LEI figures came in below expectations, which dampened the momentum of the recently improving set of economic data. This led stocks into a steadily selloff the rest of the morning.
By early afternoon, it was clear that the bears were in control. A mid-morning report from Reuters stating that the ECB is no closer to agreeing on a Greek bond plan did not help the bull camp either. Stocks would continue their steady decline into the late afternoon up until about 30 minutes before the close, where a brief rally helped major indices up off of their intraday lows.
Thursday’s session was the first clear bear victory in quite a while. There hasn’t been steady downward action all day during trading hours since December 28, 2011. However, the market wasn’t as overbought then as it is now, and it is worth noting that all major indices still finished the day above their 5-day moving averages.
Moving forward, tomorrow’s U.S. GDP figure will likely give us a clear cut answer to which direction stocks will head in the short-term.
Close Recap: S&P 500 -0.57%, NASDAQ -0.46%, DJIA -0.17%, Midcaps -0.68%.
Have a pleasant evening.
S&P 500 - Intraday
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