Stocks Erase Some Losses; Housing And Apparel Lead


Stocks retook some of last week’s lost ground as housing stocks and apparel makers led the way Monday.

The S&P 500 rose 0.8%, while the Nasdaq and the Dow Jones industrial average added 0.7% each.

Volume edged up on the Nasdaq and the NYSE, according to preliminary calculations.

Several stocks broke out but either they didn’t have top fundamentals or their action was flawed.

Home improvement retail chain Lowe’s (LOW) popped 3% as it cleared a 32.10 buy point in a cup-with-handle base. Volume, though, was only slightly above average. A breakout should have volume at least 40% above average to indicate funds are behind the move. The stock also has a mediocre Composite Rating of 71.

The Composite Rating combines all five IBD ratings into a single number.

American Tower (AMT) charged above a 73.09 buy point from a low handle, although it can also be interpreted as an alternative buy point for the flat base. Volume was 144% above average for the real estate investment. The real estate investment trust has a Composite Rating of 80.

Vehicle parts supplier to collision and repair shops LKQ Corp. (LKQ) swung above a 20.11 buy point in an odd consolidation. Volume, though, was 21% above average, a bit light for a breakout. The Composite Rating is 90.

Among apparel maker stocks trading at 15 a share and up, 18 of 19 were up and about half were up 2% or more.

Economic news was mixed. Retail sales climbed 1.1% in September, above the 0.7% growth economists expected. The New York Federal Reserve’s Empire State business conditions index — a regional manufacturing gauge — came in at -6.2 in October. That’s up from September’s -10.4, but the gauge now shows three straight negative readings.

On Tuesday, existing home sales for September will be reported at 10 a.m. Eastern time. The Street’s consensus expectation is 4.75 million, which would be a slight drop from August’s 4.82 million. Existing home sales account for a larger share of the housing market than new homes and thus are a better trend indicator.

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