This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Opening Print and S&P Levels to Watch

Today's economic calendar starts with the Chicago Fed activity index, PMI manufacturing index flash and some Fed speak out of Dennis Lockhart, William Dudley and Richard Fisher. We think it could end up a busy week with T+3 and the September quarter-end rebalance.

On Friday there were some changes made to the Dow. It is called a "switch." This is where the index takes out some stocks and add others. These changes are very important to the three firms being booted (Alcoa (AA), Hewlett-Packard (HPQ), and Bank of America (BAC)) and to the way the public perceives them.

As we all know, the Dow 30 is a "broader market" index and when stocks are removed or sidelined it could have larger economic consequences. The purpose of switches is to maintain the correct weighting within the index, one that reflects the broad market.

This morning Dow welcomes Goldman Sachs (GS), VISA (V) and Nike (NKE) will be added to the Dow, which will make financial stocks the most important sector in the Dow, pushing the sector past the industrial sector and giving financials nearly 35% of the weighting of the average. It is the first 3-for-3 stock switch since April 8, 2004.

Our View:

It was clear that after the Fed no-taper and the pop up to 1725 that the ESZ was extended, and that was why we said sell rallies. But how long will the selloff last? According to the Trader's Almanac, the week after the September triple witching has the Dow down 17 of the last 22 occasions with an average loss of -1.2% since 1990. The end of September is prone to weakness and end-of- quarter portfolio restructuring.

We will see one of our favorite market events, one little known to average investors, T+3, where the mutual funds get to mark up their winning stock positions and sell the losers. The sum total of these factors may not lead to a selloff, but it is unlikely to boost any rallies.

While we lean to still selling rallies, there could see some type of pop either today or tomorrow. We also will be looking for signs of "back and filling" over the next few days.

As always, use stops and keep an eye on the 10-handle rule. Don't forget to catch MrTopStep on The Closing Print video. We report directly from the SPX pits, wrapping up the day and positioning for trade tomorrow.

OptionsProfits can be followed on Twitter at

MrTopStep can be followed on Twitter at

For LIVE futures chat, more information on the 10-handle rule and futures educational content CLICK HERE FOR A SEVEN-DAY FREE TRIAL.

At the time of publication, Danny Riley held no positions in the stocks or issues mentioned.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AA $10.24 0.00%
BAC $14.13 0.00%
GS $160.07 0.00%
HPQ $11.59 0.00%
NKE $59.11 0.00%


Chart of I:DJI
DOW 17,651.26 -99.65 -0.56%
S&P 500 2,051.12 -12.25 -0.59%
NASDAQ 4,725.6390 -37.5850 -0.79%

Free Reports