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Stocks end mixed after solid PMI services data

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Stocks end mixed after solid PMI services data

US stocks started off with defensive tone, as yields continued to climb based on stronger than expected data.  Although Friday’s non-farm payroll report was weaker than many economists’ expected, strong manufacturing data along with service data released on Monday, put the September tapering of FOMC bond purchases back in the headlines.

On the economic front, the US service-sector expanded in July, according to the Institute for Supply Management. The ISM said its survey of purchasing managers in the service sector climbed to 56.0% last month from 52.2% in June. That’s the highest level since February. Economists surveyed by had expected the index to rise to 53.1%. The ISM’s new-orders index increased to 57.7% from 50.8% and production surged to 60.4% from 51.7%, but the employment gauge dipped to 53.2% from 54.7.

European data released before the opening bell put US stocks on the defensive.  According to Eurostat the volume of sales in June was down 0.5% from May, and 0.9% from June 2012. The month-to-month decline was the largest since December 2012.

Stocks closed mixed with the Nasdaq 100 settling in the black and the S&P 500 index along with the Dow Industrials closing in the red.  Facebook and Apple were again the markets leaders pushing the Nasdaq to new multi-year highs.

Momentum on the Nasdaq continues to move higher while the trajectory looks positive.  The index can climb to 20 before it would see resistance.  The RSI on the other hand is printing above the 70 overbought trigger level, and its flashing a warning sign.

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