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
in today's market downturn, according to Senior Trading Analyst
- How short-term bullish option traders
zeroed in on
online game maker Zynga (
) ahead of earnings.
- Ford Motor (F), Yahoo! (
), and Microsoft (
among option traders today.
- The Dow takes a big jump back, factory numbers disappoint,
and options traders react to Cisco Systems (
), 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 (
) 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.
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.
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 (
). Other carriers, including Japan's All Nippon Airways, also
have made similar announcements.
- 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 (
) 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.
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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