Stock Market Commentary for Thursday, April 14, 2005

Despite the negative chatter about the mediocre retail sales report, Nasdaq's sharp 31.03-point decline on Wednesday was strictly about technical trading, not about economic or business fundamentals. Despite the chatter, there was no news that changes the overall economic and business outlook. Traders and speculators are still fiercely determined to artificially push Nasdaq below it's intra-day low of two weeks ago. Some days they fail to make progress (like Tuesday), and some days the do (like Wednesday).

One intriguing possibility is that some of the hot money that's been flowing out of oil speculation lately may be finding a home in the stock-shorting game, again. We'll see how it goes.

Despite the disappointing retail sales report, mortgage applications were up and gasoline prices were down, so it was actually a decent day on the economic front.

Nasdaq trading volume was just barely moderate (1.76 billion shares), and breadth was very strongly negative, with 2.49 losers for each gainer. Despite the big point decline, this was not a heavy sell-off. This is precisely the kind of wild volatility that can occur when trading volume is light. All the negative talk was just that: talk intended to heighten volatility to con people into dumping positions.

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-- Jack Krupansky