So much for the rally to 14,000 -- the
Dow Jones Industrial Average (DJI)
took a major step back today, falling nearly a full percentage
point after eclipsing 14,000 for the first time in five years to
end last week on a major upswing. The red was all over the board,
as only one company in the Dow gained on the day. Disappointing
factory order numbers, down markets overseas, and perhaps a Super
Bowl hangover all helped get things started off on a downward trend
-- and the market never recovered. It was the first 100-point daily
drop in more than a month.
Continue reading for more on today's market, including
:
- There was a
surprise winner
in today's market downturn, according to Senior Trading Analyst
Bryan Sapp.
- How short-term bullish option traders
zeroed in on
online game maker Zynga (
ZNGA
) ahead of earnings.
- Ford Motor (F), Yahoo! (
YHOO
), and Microsoft (
MSFT
) saw
notable attention
among option traders today.
plus...
- The Dow takes a big jump back, factory numbers disappoint,
and options traders react to Cisco Systems (
CSCO
), which had been one of the few positive notes on the Dow up
until the final minutes of trading.
Spooked by fears in European markets and slower-than-expected
growth for factory orders, the
Dow Jones Industrial Average (DJI)
took a fall from its giddy highs reached at the end of last week.
The Dow finished at 13,880.08, losing nearly 130 points, or about
0.9%. Only The Boeing Company (
BA
) advanced, gaining 0.5%. The Travelers Companies (TRV) had the
biggest fall out of the 29 decliners, losing nearly 2.4%. It was
the first time since Dec. 28 of last year that the Dow dropped more
than 100 points.
The
S&P 500 Index (SPX)
also declined, shedding more than 17 points, or 1.2%, to close at
1,495.71. The index also closed below 1,500 for only the second
time in the last seven trading sessions. The
Nasdaq Composite (COMP)
fell nearly 48 points (1.5%) to finish at 3,131.17.
The
CBOE Volatility Index (VIX)
rose on all the uncertainty, shooting back above 14 to close at
14.67, up 13.7%.
3 Things to Know About Today's Market
:
- The U.S. Commerce Department reported that
factory orders rose
by a seasonally adjusted 1.8% in December. Economists had
predicted a rise of 2.2% in the month.
(The Wall Street Journal)
- Japan Airlines said it would seek compensation for
the nearly $8 million and counting
that it has lost due to the ongoing grounding of the Dreamliner
787 manufactured by The Boeing Company (
BA
). Other carriers, including Japan's All Nippon Airways, also
have made similar announcements.
(Chicago Tribune)
- The U.S. Justice Department said
it will sue
ratings company Standard & Poor's (S&P) over what it
deems faulty ratings of mortgage bonds ahead of the 2008
financial meltdown. The suit might seek as much as $1 billion in
recompense, according to sources.
(The New York Times)
5 Stocks We Were Watching Today
:
- Citrix Systems (CTXS) received an analyst downgrade and then
a ton of attention
from put traders looking to cash in on the pessimistic news.
- Outdoor apparel and boot maker Deckers Outdoor (DECK) saw
a big jump in call trading
.
- Option bears
looked to cash in
on today's pullback in manufacturing conglomerate General
Electric Company (GE).
- Strong earnings and technical tailwinds
drew longer-term call traders
to newspaper giant Gannett Co. (GCI).
- IT equipment maker Cisco Systems (
CSCO
) was targeted by
call traders today
, who looked to cash in on the stock's short-term trend.
For a look at today's options movers and commodities
activity, head to page 2.
Commodities
:
With the dollar rising amid political uncertainty across the
Atlantic, oil futures settled lower on the day. The March contract
for black gold dipped $1.60, or 1.6%, to close at $96.17 per
barrel. On the other hand, investors turned to the "safe haven" of
gold as U.S. equities moved lower. April gold futures advanced
$5.80, or more than 0.3%, to end the day at $1,676.40 an ounce.
At the end of every market day, the staff at Schaeffer's
Investment Research reviews the trading day in detail, covering
major events and key market developments. Don't miss this
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