Fed Remarks Boost Stocks to Another Tuesday Win

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"The Tuesday streak continues," summarized Schaeffer's Senior Technical Strategist Ryan Detrick, CMT, of a day where the Dow Jones Industrial Average (DJI) broke out of an early funk to close solidly higher. "The Dow is now up an incredible 19 straight Tuesdays. In fact, the Dow has gained more than 1,400 points this year during Tuesday sessions alone. In the whole scheme of things it might not mean much, but the reality is we are in the midst of some amazing records."

Continue reading for more on today's market, including :

plus...
    Apple Inc.'s ( AAPL ) Tim Cook testifies, Facebook ( FB ) bulls get conservative, and DryShips ( DRYS ) speculators turn out for earnings.

The Dow Jones Industrial Average (DJI) turned into negative territory this morning, putting its streak of 18 winning Tuesdays in jeopardy, but the blue-chip index turned higher in late-morning trading, notching a 19th consecutive Tuesday win, up 52.3 points, or 0.3%, at 15,387.58. In other record news, the Dow hit yet another new all-time high of 15,434.50 during the session. Eighteen of the 30 Dow components moved higher today, led by Merck (MRK), which rallied 4.7%. Alcoa (AA) was unchanged today, and Travelers Companies (TRV) brought up the rear, losing 2.2%.

Also scoring another record-setting intraday high was the S&P 500 Index (SPX) , which rallied to 1,674.93 this afternoon before settling up 2.9 points, or 0.2%, at 1,669.16. The Nasdaq Composite (COMP) enjoyed modest gains as well, gaining 5.7 points, or 0.2%, to close at 3,502.12, after hitting a 12-year peak of 3,512.15 in afternoon trading.

The CBOE Market Volatility Index (VIX) managed to rally as well, despite the gain in equities. The VIX appreciated by 0.4 point, or 2.7%, settling at 13.37, just shy of its 20-day moving average.

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

A Trader's Take :

"It was a light news day, as everyone was gearing up for [Federal Reserve Chairman Ben] Bernanke's speech to Congress tomorrow. Still, Home Depot (HD) had some great earnings, sparking strength in the retail group. One area to watch is the Russell 2000 (RUT), which is right up against the psychological 1,000 area. Small-caps have done great recently, but this is one area to pay very close attention to."

3 Things to Know About Today's Market :

  • St. Louis Federal Reserve President James Bullard lit a fire under bullish traders today, following some uncharacteristically dovish comments . Specifically, he recommended a continuation of the central bank's bond-buying practices, citing that it "is closest to standard monetary policy, involves clear action and has been effective." (Bloomberg)
  • Apple Inc. ( AAPL ) CEO Tim Cook appeared in Washington to dispute a Senate report claiming the iPhone parent used loopholes to avoid paying taxes. "We pay all the taxes we owe," Cook asserted, "every single dollar." (Los Angeles Times)
  • Jamie Dimon, chairman and CEO of JPMorgan Chase (JPM), will be keeping both of his titles . The ballot item that would have stripped Dimon of the chairman role received the backing of just 32.2% of shareholders. The other 10 JPM directors were also reinstated. (The New York Times)

5 Stocks We Were Watching Today :

  1. Facebook Inc ( FB ) traders used a bull put spread to place a short-term bet on support .
  2. LinkedIn (LNKD) scored a new "buy" rating and a generous price target of $225 today.
  3. Option bulls swarmed DryShips Inc. ( DRYS ) ahead of the shipping concern's earnings report.
  4. Short-term bears targeted First Solar (FSLR), even as the stock hit a new multi-year high.
  5. Call buyers expect a modest move higher in BP plc (BP) over the next few months.

EARNINGS

For a look at today's options movers and commodities activity, head to page 2.

STOCKS - NOTABLE CALL ACTIVITY

STOCKS - NOTABLE PUT ACTIVITY

Commodities :

Oil snapped its four-session winning streak on Tuesday, with June-dated crude futures shedding 55 cents, or 0.6%, to end at $96.16 per barrel in their final session before expiration.

Ahead of Fed Chairman Ben Bernanke's Congressional testimony, as well as the latest Federal Open Market Committee (FOMC) meeting minutes, stimulus-sensitive gold futures retreated on Tuesday. A strengthening greenback also weighed on gold, with the June contract giving up $6.50, or 0.5%, to end at $1,377.60 an ounce.

SCHAEFFER'S MARKET POSTURE



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Options

Referenced Stocks: AAPL , DRYS , FB , GRPN , HPQ

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