Just when everyone has the S&P 500 index futures figured out, it has a day like today, which strongly reinforces the “random walk” theory. Much of Wall Street was conditioned from last week’s price action, that Monday was an opportunity to sell Friday’s rip and bring them in lower, or better yet much lower.
Off the opening bell, it appeared that was going to be the case. After a lower open, the bears began to press the index lower to breach the premarket low and then some. However, buyers stepped up and defended the psychological 4400 support level as the index found buyers well ahead of the premarket low (4395.50) only reaching 4402.75 and the rally was on.
The index paused at last week’s high (4446.25), but once it stabilized at the area, the pace of the rally accelerated. Not only did the index breach its six-day high (4487), it came within a whisker of taking back half of the entire decline from the all-time high (4808.25) to last Monday’s low (4212.75) when it peaked at 4507.75.
A large buy imbalance brought out the “late to the party” buyers, but they were snuffed out instantly. While the close and actual mark for the index is 4504.25, adding 81 handles, the last after-hours print was notably lower at 4491.75.
On the heels of a Credit Suisse upgrade, Tesla Inc. (NASDAQ: TSLA) was the biggest gainer of the top components of the index. For the session, the issue added $90.37 or 10.68% to close at $936.72.
That was nearly 6 times the cash index’s gain of 1.89%.
For the second session in a row, the biggest loser of the top components was the smallest gainer. That being Johnson & Johnson (NYSE: JNJ) which was higher for the fifth day in a row adding $0.50 or 0.29% to close $172.29.
