Stocks Close Lower, Headed For Another Down Week  Image: Bigstock Stocks closed lower again yesterday as the pullback continued. Since making their YTD highs just a few weeks ago, the Dow is off by -2.43%, the S&P is off by -4.73%, and the Nasdaq is off by -6.15%. But that's good news. Because pullbacks like these are very common and healthy. Every bull market has them. In fact, stocks usually pull back about -5% roughly 3-4 times per year. (A pullback is defined as a decline between -5% and -9.99%.) And pauses like these help refresh and strengthen the market before their next leg up. The day got started yesterday with Walmart reporting earnings before the open and posting a positive EPS surprise of 8.88%, and a positive sales surprise of 1.13%. They also raised full-year earnings guidance by 2.56% to a midpoint of $6.41 vs. the consensus for $6.25. Nonetheless, shares were down today by -2.24% on the day. In other news, Weekly Jobless Claims fell by -11,000 to 239K vs. views for 240K. The smoother 4-week moving average came in at 234.25K. E-Commerce Retail Sales came in at 2.1% on a q/q basis vs. last quarter's 3.0% pace and estimates for 2.7%. The Philadelphia Fed Manufacturing Index rose to 12 vs. last month's -13.5 and the consensus for -10.0. That's a sharp improvement. And the Leading Indicators report came in as expected with a -0.4% m/m print, a little better than last month's -0.7% change, but in line with expectations. Today there's not much on the docket in terms of economic reports with only the Quarterly Services Survey and the Baker Hughes Rig Count report in queue. We'll get more earnings with another 121 companies set to report. But earnings season is almost over. As mentioned up top, the current pullback is nearing typical pullback ranges. Actually, the Dow is 'only' down half the typical threshold, while the S&P is only a quarter of a percent away. The Nasdaq however is within the typical range. Same goes for the small-cap Russell 2000 and the mid-cap S&P 400. Given the typical pullback range, there could still be more room to go, and still be considered your average run-of-the-mill pullback. But they are also all close enough to turn around and head back up. Either way, in aggregate, if this is your typical pullback, we are closer to being done with it than not. And that's why beginning to buy the dip at these levels makes sense. See you tomorrow,  Kevin Matras
Executive Vice President, Zacks Investment Research | 
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