Chaos Ends With Bulls Ahead
08/01/07 - 05:14 PM EDT
Robert Holmes
Breadth was decidedly negative. About 4.93 billion shares changed hands on the New York Stock Exchange, where decliners beat out advancers by a 2-to-1 margin. Volume on the Nasdaq reached 2.89 billion shares, with losers outpacing winners 3 to 2.
Continuing worries about the potential for lending-related blowups kept traders on guard early, and for a time appeared set to sink the market. Beazer Homes (BZH Quote - Cramer on BZH - Stock Picks) plunged as much as 40% and dragged down the rest of the homebuilding sector amid rumors the company was facing a liquidity problem. Beazer quickly moved to deny the speculation, but investors unloaded positions at the mere hint of trouble. Beazer finished down nearly 18%, and others in the group, such as Hovnanian (HOV Quote - Cramer on HOV - Stock Picks) and Meritage Homes (MTH Quote - Cramer on MTH - Stock Picks), were lower as well, but finished off their worst levels. The erratic action wasn't unlike the previous session. On Tuesday, the day started promisingly enough, and for a brief time the Dow was ahead by more than 130 points. By the afternoon though, lingering nervousness about the credit market had left the bears firmly in control. Last time out, the Dow gave back 146.32 points, or 1.10%, to 13,211.99, and the Nasdaq plunged 37.01 points, or 1.43%, to 2546.27. More woes at Bear Stearns (BSC Quote - Cramer on BSC - Stock Picks) compounded the uncertainty. The investment bank lost 2.4% on reports that it's facing losses in a third mortgage-related fund.
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