Key market indexes gapped down at the open and headed lower Monday, as the Dow Jones today led the sell-off with a nearly 400-point drop.
XUnrest in Hong Kong and shocking results of a presidential primary election in Argentina added to trade war tensions with China.
The Dow Jones Industrial Average sank 1.5%, the S&P 500 tumbled 1.2% and the Nasdaq composite also lost 1.2%. Small caps tracked by the Russell 2000 shed nearly 1.2%. Preliminary data showed lower volume on the NYSE and Nasdaq vs. Friday, slightly easing the sting.
The Dow Jones index has been stuck under its 50-day moving average now for a full week. It tested the 200-day early last week and is now 1% above the long-term support line. The S&P 500 and Nasdaq regained their 50-day lines on Thursday. They remain a respective 3% and 4% above their 200-day lines.
Twenty nine of the 30 Dow stocks fell, with Pfizer (PFE), Goldman Sachs (GS) and United Technologies (UTX) among the biggest losers. Pfizer sank more than 2% to a 15-month low, weakening further since its July 29 Q2 report and announcement of a merger between its Upjohn unit with Mylan (MYL). Shares are now 23% off their 52-week high.
While most of the Dow Jones stocks are well below their 50-day lines, McDonald's (MCD), Microsoft (MSFT) and Visa (V) have held up remarkably well by comparison.
Dow Jones Stocks Finding Support
McDonald's, down 1.9% Monday, is 2% off its Friday peak. Microsoft, down 1.4%, is testing support at its 50-day but stays in an uptrend. It's 4% off its high. And Visa, down 1.5% Monday, holds slightly above its 50-day and is also just 4% off its high.
Solar, retail and financial stocks led the downside in today's stock market. Meat products, nonalcoholic beverage and gold miners were among the few industry groups bucking the sell-off.
Gold prices are at their highest levels in six years as trade war and geopolitical tensions roil the market. Gold ETFs continued to shine: SPDR Gold Shares (GLD) and iShares Gold Trust (IAU) added 1% each. Check out this column for more the gold rally and how to play the gold rush.
Over in the IBD 50, Banco Macro (BMA) gapped down and plunged more than 50% in heavy trade. At its session low, the bank's share fell to its lowest point in nearly a year. Argentine stocks got hammered Monday following President Mauricio Macri's shocking defeat in a presidential primary election.
Before Monday's sell-off, Banco Macro ranked No. 43 in the IBD 50.
Among other IBD 50 stocks, Brazilian payment company StoneCo (STNE) sank 5% as it continues to form a new base. Trade Desk (TTD), Paylocity (PCTY) and Chegg (CHGG) lost more than 5% apiece.
But SolarEdge Technologies (SEDG) soared 5% to a new high, extending its win streak to five. The Israel-based solar power company on Wednesday announced Q2 earnings and revenue that topped views. It also offered Q3 guidance well above Wall Street forecasts. Essential Properties Realty Trust (EPRT) climbed 2%.
The Innovator IBD 50 ETF (FFTY) fell nearly 1.9%, sliding back below its 50-day line.
Follow Nancy Gondo on Twitter at @IBD_NGondo
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