"Today was all about the Fed," said Schaeffer's Senior Equity
Analyst Joe Bell, CMT. "In a somewhat shocking move for the market,
the Federal Reserve made its highly anticipated policy
announcement, and decided not to begin tapering at this time. The
markets reacted quite favorably, as the
Dow Jones Industrial Average (DJI)
jumped more than 200 points from its intraday lows." As a result,
the index tagged a new record high.
Continue reading for more on today's market, including
- Schaeffer's Senior Options Strategist Tony Venosa, CMT,
explains why SolarCity (
) could be ripe for the bullish picking in his latest
Chart of the Day
column covers an Internet company, an automobile giant, and just
how slim your chances are of winning tonight's Powerball.
- An early morning price-target hike for this
well-known financial stock
triggered a flurry of bullish activity.
Housing starts edged slightly higher in August, BlackBerry (
) announced massive layoff plans, and Zynga (
) attracted front-month option bulls.
Dow Jones Industrial Average (DJI - 15,676.94)
was parked in negative territory this morning -- and for the first
half of the afternoon, as well -- before rallying to an all-time
intraday peak of 15,709.58 around 3 p.m. By the closing bell, the
index was up 147.2 points, or 1% -- notching a new record closing
high. Once again, Alcoa (
) led the 29 advancing blue-chips with a gain of 3.6%, while
) -- the sole decliner -- lost 1.7%.
S&P 500 Index (SPX - 1,725.52)
experienced a few brief blips higher this morning, but like the
Dow, spent a considerable amount of time in the red. Following the
Fed news, however, the SPX touched a record intraday peak of
1,729.44, and finished with a gain of 20.8 points, or 1.2% --
again, marking an all-time closing high. Meanwhile, the
Nasdaq Composite (COMP - 3,783.64)
climbed 37.9 points, or 1%, finishing at its highest level in
nearly 13 years.
CBOE Market Volatility Index (VIX - 13.59)
took a tumble after the FOMC update, shedding 0.9 point, or 6.5%,
by day's end.
A Trader's Take
"With today's rally, most of the major indexes broke out to new
all-time highs, and the scary pullback in August is now nothing but
a blip in the rearview mirror," mused Bell.
3 Things to Know About Today's Market
- Wall Street cheered the Federal Open Market Committee's
latest policy update
, as the central bank unexpectedly voted
scaling back its bond-buying program in the near future. "The
Committee decided to await more evidence that progress will be
sustained before adjusting the pace of its purchases," the Fed
stated. "The tightening of financial conditions observed in
recent months, if sustained, could slow the pace of improvement."
(The New York Times)
- The Commerce Department said
rose by a smaller-than-expected 0.9% in August to a seasonally
adjusted yearly rate of 891,000. On a year-over-year basis,
however, starts were up 19%. Meanwhile, building permits declined
by 3.8% last month to an annual rate of 918,000.
- On the heels of recent buyout buzz, BlackBerry (
) announced it will be making
massive staffing cuts
by year's end. Sources said the mobile phone maker could end up
laying off as many as 40% of its employees, and that the pink
slips will be distributed across the board.
5 Stocks We Were Watching Today
received an upgrade and a price-target hike at Credit Suisse in
- Near-term option bulls swooped down upon
, and snapped up September-dated calls.
- Analysts at Baird downwardly revised their opinion of
, despite recent gains.
saw a surge in call trading, but a large portion reflected
- Put buyers gravitated toward
Walt Disney (DIS)
, wagering on short-term losses for the entertainment giant.
For a look at today's options movers and commodities
activity, head to page 2.
Crude futures snapped their losing streak, thanks to a drop in
oil supplies, as well as the Fed's decision not to taper its
bond-buying program. By the closing bell, October-dated crude added
$2.65, or 2.5%, to end at $108.07 per barrel.
Meanwhile, gold futures settled lower ahead of the Fed
announcement, as gold for December delivery shaved off $1.80, or
0.1%, to finish at $1,307.60 an ounce. However, following the
FOMC's well-received update, the malleable metal climbed almost 3%
in electronic trading.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.