ETFs Catch Another Whiff Of The Cliff

U.S. ETFs and stocks spent most of the day yesterday in the green as Home Depot (HD) beat expectations and climbed 3.63% for the day. However, the good news couldn’t offset a 3% plunge in Microsoft (MSFT) as its head of Windows headed for the door.

All major U.S. indexes and index ETFs finished in the red yesterday with the Nasdaq 100 (QQQ) taking the largest hit on the news from Microsoft regarding the President of Window, Steven Sinofsky, leaving the company.

The tech sector (XLK) declined 0.48% during the day and continued making news after hours as Cisco (CSCO) climbed 7% and Advanced Micro Devices (AMD) declined 2.4% on earnings news.

In Europe, nerves remain on edge as the Union continues to delay releasing the next round of bailout money to Greece.

But the dominant issue remains the fiscal cliff and meetings are scheduled to get underway this week at the White House in hope of finding some resolution to this problem. While no one believes the dive off the cliff will happen, Congressional leaders and the President seem to remain at odds and digging into incompatible positions.

U.S. Index ETFs

Dow Jones Industrial Average (DIA) -0.46%

S&P 500 (SPY) -0.40%

Nasdaq 100 (QQQ) -0.80%

Russell 2000 (IWM) -0.60%

Gold (GLD) -0.20%

Oil (USO) -0.21%

Technical indicators remain bearish with all major equity indexes below their respective 200 day moving averages.

Bottom line: Fundamental factors including the fiscal cliff and problems in Europe, combined with a weak technical picture, continue to weigh heavily on global equities as we head towards the Thanksgiving holiday.

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