STOCKS START THE DAY UNDER PRESSURE -- SMALL CAPS ARE LEADING THE DECLINE -- SO ARE FINANCIALS AND INDUSTRIALS

DOW AND S&P 500 WEAKEN... Stock prices are continuing the pullback that began yesterday afternoon.  And some short-term support levels may soon be tested.  Chart 1 shows the Dow Industrials slipping below their 20-day average (green line) and in position to test their early May low at 23400.  They may also restest their 50-day average.  Chart 2 shows the S&P 500 threatening its 20-day line.  Initial support for the SPX is at 2797.  A move below that recent low could signal a deeper pullback.   All eleven stock sectors are in the red with the weakest being energy, financials, industrials, and materials.  Smaller stocks are also experiencing bigger losses, which suggests that the breadth of the current rally may be weakening.  Chart 3 shows the S&P 600 Small Cap Index trading below its early May low.