"What started off as a promising bounce was devoured by the
bears," quipped Schaeffer's Senior Technical Strategist Ryan
Detrick, CMT. "There really wasn't a lot of news that sparked the
selling, just a steady lack of buyers as the day progressed." Over
Dow Jones Industrial Average's (DJI)
record-setting streak of sessions without three consecutive losing
days, as it surrendered 127 points to close just shy of the 15,000
Continue reading for more on today's market, including
The "fear barometer" hits a multi-month high, early adopters of
) bonds learn some unpleasant news, and Texas Instruments (
) bears bet against earnings.
Dow Jones Industrial Average (DJI)
dropped 126.8 points, or 0.8%, to close at 14,995.23. The move not
only put the index south of the psychologically important 15,000
barrier, but below its 40-day moving average as well, which has
been breached just twice on a daily closing basis in 2013. Four of
the Dow's 30 components managed to close in positive territory,
with Hewlett-Packard (
) leading the charge, up 2.8%. Bringing up the rear was American
), which dropped 2.4% to come in last among the 26 declining
S&P 500 Index (SPX)
was also down 0.8%, shedding 13.6 points to close at 1,612.52. The
Nasdaq Composite (COMP)
held above its 40-day moving average by a hair, but still gave back
36.5 points, or 1.1%, to settle at 3,400.43. So far this week, the
COMP is the worst performer among the major indexes, down nearly
CBOE Market Volatility Index (VIX)
, meanwhile, has surged nearly 23% during the last three days,
tacking on an additional 8.9%, or 1.5 points, in today's trading.
The VIX closed at 18.59 after hitting the 18.60 mark intraday --
its highest level since late February.
A Trader's Take
"Another streak bites the dust," noted Detrick. "This time, the
Dow finally dropped three straight days. It hadn't happened in all
of 2013, and the streak made it up to a record 112 days. The
previous record was 95 days back in 1935. Is the 'buy the dip'
mentality that has worked so well finally ending? This trend --
coupled with the nice, big, round 1,000 level on the Russell 2000
Index (RUT) acting as huge resistance -- means the 'June Chop'
theory is playing out nicely so far this month ... and just might
3 Things to Know About Today's Market
- Eyes were
turned to global issues today
, as the German government implored its highest court to dismiss
charges that the European Central Bank's bond-buying program is a
violation of existing directives. Elsewhere, the situation in
Turkey became more frenzied, even as the Prime Minister agreed to
speak with protestors.
- Despite the unbridled enthusiasm at launch time, bonds issued
by Apple Inc. (
have lost 9%
during their first six weeks. The pullback can be attributed to a
sell-off in the corporate bond space, as interest rates have
(Financial Times, login required)
- For the first time in a month, the number of
new mortgage applications rose
on a week-over-week basis. This coincided with another increase
in the 30-year fixed mortgage rate, which hit an average of
4.15%, or 8 basis points higher than the previous week. Mortgage
rates have jumped 56 basis points in the past six weeks.
5 Stocks We Were Watching Today
Dendreon Corporation (DNDN)
remained a favorite among bearish speculators.
- Put buyers targeted
Texas Instruments (
, in the wake of the company's revised second-quarter earnings
Zynga Inc (ZNGA)
was a favorite among covered call traders, who expect short-term
resistance at the $3 level.
- Baird lifted its 12-month price target for
Tesla Motors (TSLA)
by a hefty margin this morning, as the stock has more than
tripled in value during the past year.
Cisco Systems (CSCO)
option traders sold intermediate-term, out-of-the-money
For a look at today's options movers and commodities
activity, head to page 2.
Crude oil muscled higher today against a mixed backdrop of news,
including reports of an increase in weekly stockpiles and estimates
for rising demand (but falling consumption) in China. By the close,
July-dated oil was up 50 cents, or 0.5%, at $95.88 per barrel.
Gold futures were also higher today, paring earlier losses as
traders looked to the safe-haven appeal of the yellow metal. Gold
for August delivery settled up $15, or 1.1%, to end the session at
$1,392 per ounce, bouncing back from an intraday nadir of