"It was a very light volume day ahead of a three-day weekend,
but that didn't mean it was boring," quipped Schaeffer's Senior
Technical Strategist Ryan Detrick, CMT. "Rumors regarding Syria
continued to swirl, creating some decent volatility on a day that
is usually incredibly slow. In the end, the indecision over Syria
isn't something traders want to hear, and it led to selling across
the board." The
Dow Jones Industrial Average (DJI)
was in the red for nearly all of the day, hitting an intraday nadir
of 14,762.35 shortly before the close. It proved to be the worst
month for both the Dow and the
S&P 500 Index (SPX)
since May 2012.
Continue reading for more on today's market, including
Consumer spending grinds to a halt, General Electric (
) prepares for a change, and Microsoft (
) option bulls get creative.
Dow Jones Industrial Average (DJI - 14,810.31)
spent the day in negative territory, and closed with a loss of 30.6
points, or 0.2%, after being down as much as 79 points mere minutes
before the closing bell. Ten of the Dow's components moved higher,
led by Wal-Mart (
) and Procter & Gamble (PG), which each gained 0.8%. The 20
laggards were paced by Alcoa (AA), which dropped 1.4% today. This
week, the Dow surrendered 1.3%, and the blue-chip index lost 4.4%
in August -- its worst month since May 2012.
S&P 500 Index (SPX - 1,632.97)
peeked above breakeven just out of the gate, but also surrendered
to selling pressure, closing off 5.2 points, or 0.3%. The
Nasdaq Composite (COMP - 3,589.87)
tumbled into the close, ultimately giving back 30.4 points, or
0.8%. The SPX and COMP lost 1.8% and 1.9% this week, respectively,
and posted monthly losses of 3.1% and 1%.
CBOE Market Volatility Index (VIX - 17.01)
continued yesterday's positive momentum, rising 0.2 point, or 1.2%.
This was the fear barometer's first close above 17 since June 26.
The VIX gained 21.7% this week and logged a 26.5% jump for the
A Trader's Take
"We've been remarking how well tech and small-caps have held up
relative to the Dow, but today was the reverse," noted Detrick.
"The Dow hung tough and the more aggressive/higher-beta areas were
hit extra hard. In the end, August saw the lightest volume since
early 2007, yet it was also the worst month for the Dow since May
2012. Which leaves everyone to ask -- is it a good sign we've had
some weakness with no conviction from sellers? Or is this just a
harbinger of things to come once the big boys come back in
3 Things to Know About Today's Market
- Stocks drifted lower at midday after Secretary of State John
condemned Syrian leaders
for the use of chemical weapons, and made a case for why
retaliation is justified. Later, President Obama reiterated the
potential for a
"limited, narrow" engagement
that would not require ground troops.
(CBS News, USA Today)
- The rate of
personal income growth
slowed to a crawl in July, ticking up just 0.1%. Consumer
spending rose 0.1% last month as well, falling short of
expectations. Meanwhile, August's
final reading on consumer sentiment
from Thomson Reuters/University of Michigan slipped to 82.1 from
85.1 the previous month, but was higher than the mid-month
(Los Angeles Times, Reuters)
- General Electric (
) wants to exit the lending business, and is looking to
spin off its consumer lending operations
, GE Capital. The conglomerate has already started working toward
an initial public offering of this unit, which has about 55
million customers holding store credit cards.
(The Washington Post)
5 Stocks We Were Watching Today
Option Idea of the Week
makes a bullish case for
Caesars Entertainment Corp (CZR)
- A bullish
trader used three options to bet on long-term upside.
dances near new-annual-high territory, it scored an upgrade from
Freeport -McMoRan Copper & Gold (FCX)
was targeted by put buyers, who may have been uneasy shareholders
- Bearish options speculation ramped up on
Pfizer Inc. (PFE)
, as put buyers eyed the January 2014 series.
For a look at today's options movers and commodities
activity, head to page 2.
Crude futures dipped once again, as fears surrounding military
action against Syria eased. The October contract dropped $1.15, or
1.1%, to $107.65 per barrel. On the week, black gold added 1.2%,
while rising 2.5% in August (when comparing front-month
Gold futures lost ground for the third consecutive session, as
December-dated futures surrendered $16.80, or 1.2%, to $1,396.10
per ounce. On the week, the malleable metal inched up a fraction of
a percent, but tacked on 6.3% during the past month.
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