Trading in the Nasdaq Composite was exhibiting panic-like-buying behavior Friday morning, a day after exhibiting panic-like selling a day ago. The Nasdaq Composite (NASDAQ:COMP) was trading 0.5% lower at 13,041, while the Nasdaq Arms Index, a volume-weighted breadth measure, fell to 0.453. Many on Wall Street see declines below 0.500 as suggesting panic buying. The Arms Index is calculated by dividing the ratio of the number of advancing stocks over decliners by the ratio of the volume of advancing stocks over declining volume. As the stock market rises, the Arms often falls below 1.000, as the buyers rush into advancing stocks. The number of stocks declining on the Nasdaq on Friday outnumbered advancers by nearly 2 to 1, with volume in advancing stocks representing about 51% of total volume on the Nasdaq Composite. Meanwhile, the Dow Jones Industrial Average [: DJIA] was trading 0.7% lower at 30,761, while the S&P 500 index (S&P:SPX) was trading 0.8% lower at around 3,765.
Jan. 15, 2021, 10:08 a.m. EST