Early gains eroded into losses in late morning trade, as the positive effect from the Cyprus bailout faded.
The Dow gave up its early gain and dropped 0.4%. The Nasdaq slipped 0.3% and the S&P 500 dipped 0.2%. Trade meanwhile firmed, rising about 5% from Friday’s level on the Nasdaq and up 4% on the NYSE.
The stock market today opened higher, with nine in ten industries advancing in early trade. By 11:15 a.m. ET, nearly half of the 197 industries tracked by IBD had backtracked and were in the red.
Currencies appeared to be a key element in the turn, as the euro reversed its early gains, sending the dollar higher and pressuring U.S. stocks. Investors initially cheered Monday’s agreement that headed off a banking failure in Cyprus and the country exiting the eurozone.
Attention shifted, however, to the broader implications of the bailout. A leading concern is that the Cyprus deal, essentially a seizure of bank deposits of more than 100,000 euros, could set the stage for similar solutions in other ailing eurozone economies.
Among leaders, Lumber Liquidators (LL) held on to a 4% gain in better than three times its average volume. The move was a breakout, lifting the flooring retailer past a 68.38 buy point from a three-weeks-tight pattern. The stock is technically in buying range through 71.70.
Oceaneering International (OII) was up 2% after trimming an initial advance. The initial move cleared a 65.47 buy point from a flat base, but the retreat left the stock just below that mark.
On the downside, U.S. Silica Holdings (SLCA) slumped 4% in busy trading. The provider of sand-based products, primarily to gas and oil producers, has been attempting to rebound from support at its 10-week moving average. Monday’s move gave back a large share of the stock’s recent effort.