"There wasn't a whole lot to cheer about today," admitted
Schaeffer's Senior Equity Analyst Joe Bell. "There was a
combination of negative economic drivers, but China's
worse-than-expected gross domestic product (GDP) number was most
prominent. Gold and other commodities were hit the hardest, with
the yellow metal registering one of its worst days in several
Dow Jones Industrial Average (DJI)
added to its losses as the day dragged on, ending with a deficit of
more than 260 points. Meanwhile, the
CBOE Market Volatility Index (VIX)
reacted to all the turmoil by shooting more than 43% higher.
Continue reading for more on today's market, including
- Why Senior Trading Analyst Bryan Sapp expects
throughout the markets -- and what traders can do about it.
- As earnings near, speculators are taking an
increasingly positive view
of Bank of America (
- Facebook Inc (
) was targeted by short-term optimists, who expect to see
in the very near term.
- The Dow suffers a stiff loss, Chinese economic growth falls
short of estimates, and Netflix (
) bulls stay active.
Dow Jones Industrial Average
quickly entered negative territory this morning and continued to
lose ground throughout the session, violating its 10-day moving
average along the way. By the time the closing bell mercifully
sounded, the blue-chip index was a hair's breadth from its intraday
nadir, down 266 points, or 1.8%, at 14,599.20. Losses were broad,
as all 30 Dow components finished in the red. The "best" performing
name was Wal-Mart Stores (
), down only 0.1%. Bringing up the rear was Caterpillar (
), down 3.3%.
S&P 500 Index (SPX)
also ended the session near its intraday low and south of its
10-day moving average. By the close, the SPX was off 36 points, or
2.3%, at 1,552.36. The
Nasdaq Composite (COMP)
was slightly worse for wear, down 78 points, or 2.4%, to close at
CBOE Market Volatility Index (VIX)
spiked 5.2 points, or more than 43%, to settle at 17.27, its
highest close since late February.
A Trader's Take
"In addition to the news out of China, housing data was also
pretty bad," noted Bell. "As the market treaded water near its
lows, news also surfaced of explosions at the Boston Marathon. In a
day filled with bad news, this, of course, stands above the
3 Things to Know About Today's Market
- Gold continued to
move sharply lower
, dropping south of the $1,400-an-ounce mark. The precious
metal's two-day drop is the worst on record since 1980.
- Contributing to gold's drubbing was
out of China, whose consumers are frequent buyers of the metal.
The country's gross domestic product rose 7.7% in the first
quarter, falling short of both the fourth-quarter growth rate and
(The Wall Street Journal)
- For the third month running,
sentiment among homebuilders declined
. The National Association of Home Builders (NAHB)/Wells Fargo
Housing Market index dropped to 42 in April from 44 last month,
falling short of economists' consensus view. Readings north of 50
indicate that the majority of homebuilders see conditions as
favorable; the last reading above this level was in April 2006.
5 Stocks We Were Watching Today
- With earnings due later this week, Microsoft (MSFT) has seen
increased bearish betting
- Google Inc (GOOG) was initiated with a "buy" rating and an
ambitious price target
of $950 this morning.
- Long-term, deep out-of-the-money puts were popular in Tesla
Motors (TSLA), possibly as a
- Netflix, Inc. (
) traders targeted
with out-of-the-money calls.
- In a relatively
rare show of bearishness
, Las Vegas Sands (LVS) speculators scooped up long puts.
For a look at today's options movers and commodities
activity, head to page 2.
Oil continued to retreat, dropping to its lowest point in 2013
after Chinese industrial production data fell short of
expectations. May-dated crude dropped 2.8%, or $2.58, to end at
$88.71 per barrel.
This move paled in comparison to gold, which posted its steepest
one-day decline in more than 30 years. The June gold contract gave
back $140.30, or 9.3%, to end the session at $1,361.10 an ounce.
This was the lowest settlement price for a most-active contract
since February 2011.
At the end of every market day, the staff at Schaeffer's
Investment Research reviews the trading day in detail, covering
major events and key market developments. Don't miss this
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