"Similar action today from the previous days, and that isn't
good," said Schaeffer's Senior Technical Strategist Ryan Detrick,
CMT. "In the end, the five-day losing streak is over, but the
afternoon selling left a lot to be desired. If there is one
positive, it's that volume hasn't been all that impressive during
the recent market weakness. Of course, price is what pays, and it
has been disappointing. With a potential government shutdown
coming, traders are taking a wait-and-see approach." Against this
Dow Jones Industrial Average (DJI)
managed to close solidly north of breakeven.
Continue reading for more on today's market, including
- Schaeffer's Senior Options Strategist Tony Venosa, CMT, lists
seven reasons why Walt Disney (
) could be poised for a run higher in his latest
Chart of the Day
- This week's edition of
takes a closer look at three outperforming but underloved stocks
with upside potential.
- One trader bet on a layer of support to hold up against any
post-earnings backlash for this
Debt-ceiling negotiations in Washington continued to stall,
pending home sales fell for a third straight month, and Bed Bath
& Beyond's (
) well-received quarterly earnings report prompted a round of
bullish brokerage notes.
Dow Jones Industrial Average (DJI - 15,328.30)
spiked notably higher right out of the gate, tagging an intraday
high of 15,387.19 within the first hour of trading. By the close,
however, the blue-chip index pared its gains to 55 points, or 0.4%
-- snapping its five-day losing streak. Nike (
) led the Dow's 21 advancers with a gain of 2.1%, while Cisco
) paced the nine laggards with a decline of 2.7%.
S&P 500 Index (SPX - 1,698.67)
experienced some similar price action, peaking at a session high of
1,703.85 earlier this morning. By the closing bell, the index was
5.9 points, or 0.4%, higher -- and thus ending its own losing
streak. Meanwhile, the
Nasdaq Composite (COMP - 3,787.43)
climbed 26.3 points, or 0.7%.
CBOE Market Volatility Index (VIX - 14.06)
dropped at the sound of the opening bell, but gained ground
throughout the day to finish up 0.1 point, or 0.4%.
A Trader's Take
"Hey, the losing streak is over -- that's good news," said
Detrick. "Also, the action in small-caps and tech stocks continues
to hold tough. With the quarter nearly over, it is worth noting
that the Nasdaq is up more than 11% since the end of June. (I'd say
rather quietly, too.) Sure, the S&P 500 has gone virtually
nowhere since the May peak, but under the surface, small-caps and
tech stocks have done very well. I continue to think that bodes
well for a big fourth quarter, as funds chance performance and put
cash to work. It's just a matter of time until that can take place,
though. We need to work out this Washington drama first."
3 Things to Know About Today's Market
Budget negotiations in Washington
continued to hit a brick wall today, as President Barack Obama
reiterated his commitment to raising the debt ceiling. However,
House Speaker John Boehner (R-Ohio) insisted that such a move
isn't possible without implementing considerable spending cuts.
"I am sorry, it just doesn't work that way," he said during a
press conference. He also noted that the House is proposing a
bill that would marry a debt-ceiling increase with cuts in
- The Commerce Department said its final second-quarter
gross domestic product (GDP) reading
remained unchanged from last month's estimate of 2.5%. Although
the latest figure was an improvement over the first quarter's
growth rate of 1.1%, it was still slightly shy of the consensus
view. Consumer spending -- which represents around 70% of the
economy -- increased 1.8%, staying flat with the previous
- The National Association of Realtors revealed that
pending home sales
fell a larger-than-expected 1.6% in August, marking a third
consecutive monthly decline. The drop was attributed to a notable
rise in mortgage rates, as the number of contracts to purchase
previously owned homes declined across most of the U.S., save the
5 Stocks We Were Watching Today
- A stronger-than-expected quarterly earnings report triggered
a slew of price-target hikes for
Bed Bath & Beyond (
- Option bears set their sights on
, and scooped up the telecom concern's longer-term puts.
saw a heavy influx of options activity, with the stock's
longer-term calls and weekly puts receiving notable
- One bullish speculator showed his confidence in
by constructing a long call spread on the daily deals name.
Option Idea of the Week
Genworth Financial (GNW)
could benefit from heavy skepticism on the Street.
For a look at today's options movers and commodities
activity, head to page 2.
Crude futures ended a five-session losing streak, following
today's mixed bag of economic data. By the close, November-dated
crude tacked on 37 cents, or 0.4%, to finish at $103.03 per
However, the same reports weighed on gold futures, while a
number of investors watched for signs of a potential government
shutdown -- a development that could spark some "safe haven" bids.
Gold for December delivery lopped off $12.10, or 0.9%, to end at
$1,324.10 an ounce.
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