Dow Settles Flat Ahead of Fed Statement; Nasdaq Composite Tags 12-Year High


"Overall, it was a slow day today, as everyone was gearing up for the gross domestic product (GDP) and the Fed tomorrow," summarized Schaeffer's Senior Technical Strategist Ryan Detrick, CMT. "Still, Apple ( AAPL ) continued to move higher, helping push the tech sector up along with it." For its part, the Dow Jones Industrial Average (DJI) ended the day little changed from where it began, after trading in a 115-point range.

Continue reading for more on today's market, including :

  • Schaeffer's Senior Trading Analyst Bryan Sapp points out three key levels to watch heading into tomorrow's " make or break " session.
  • Is Tesla Motors ( TSLA ) headed lower ? Short-term option bears seem to think so.
  • Gold bulls are counting on a short-term bounce higher in the SPDR Gold Trust (ETF) (NYSEARCA:GLD).
    Home prices spike, a Marvell Technology ( MRVL ) bear remains pessimistic, and a "harsh reminder to not catch falling knives."

The Dow Jones Industrial Average (DJI - 15,520.59) explored a wide range today, but ultimately settled down just 1.4 points, or 0.01%. Leading the Dow's 14 advancers was Cisco Systems ( CSCO ), which gained 1.3%. As Bank of America ( BAC ) closed unchanged, Verizon Communications (VZ) paced the 15 decliners with its drop of 2.1%.

The S&P 500 Index (SPX - 1,685.96) edged up a fraction, adding 0.6 point, or 0.04%, after spending a chunk of the afternoon south of breakeven. Turning to technology, which outperformed today, the Nasdaq Composite (COMP - 3,616.47) reached another 12-year peak -- its first since July 18 -- and closed the session up 17.3 points, or 0.5%.

The CBOE Market Volatility Index (VIX - 13.39) closed flat, but held north of its 10-day moving average.



A Trader's Take :

"All week, we've been waiting for Wednesday, and it is finally here -- it's go time," quipped Detrick. "Expect the potential for a lot of volatility the next three days. In other news, fertilizer stocks were crushed -- with some down more than 15% on the day -- as news broke that a major player was abandoning the potash cartel. This is a harsh reminder to not catch falling knives. These stocks had been underperforming for a long time now, so many bottom-pickers were burned pretty badly today."

3 Things to Know About Today's Market :

  • Home prices rose in May , as reflected by the S&P/Case-Shiller home price indexes. The 10-city composite reading rose 11.8% during the last 12 months, and the 20-city reading increased 12.2% on a year-over-year basis. (Forbes)
  • The Conference Board noted that its consumer confidence index slipped from a revised reading of 82.1 in June (a five-year high) to 80.3 this month. The reading narrowly missed economists' estimates. (Bloomberg)
  • Dow name Pfizer (PFE) reported second-quarter earnings of 56 cents per share that barely exceeded analysts' expectations. Revenue, however, came in at $12.97 billion, falling just shy of estimates. (CNBC)

5 Stocks We Were Watching Today :

  1. Put volume ramped up in Hewlett-Packard (HPQ) option pits today, with speculators focusing on the September series.
  2. Baird lifted its price target for SunPower Corporation (SPWR) ahead of the solar firm's earnings report.
  3. One Marvell Technology ( MRVL ) options bear extended his bet to the back-month series.
  4. Longer-term bulls targeted Alcatel Lucent (ALU) leading up to this morning's earnings report.
  5. (BIDU) was downgraded, despite its strong performance on the charts.


For a look at today's options movers and commodities activity, head to page 2.



Commodities :

Crude oil futures lost ground, amid continued worries surrounding China's economy. September-dated crude dropped $1.47, or 1.4%, to settle at $103.08 per barrel.

Gold moved lower once again, closing in negative territory for the fourth time in six sessions. Ahead of tomorrow's policy statement from the Fed, the most-active December contract logged a drop of $4.80, or 0.4%, to close at $1,324.80 an ounce.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.

This article appears in: Investing , Options

Referenced Stocks: AAPL , BAC , CSCO , MRVL , TSLA

Schaeffer's Investment Research

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