Sluggish Earnings Reports Drag Dow, S&P 500 Lower

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"After a strong bounce yesterday that saw many major market indexes reach new all-time highs, a number of sectors gave back some of these gains today," noted Schaeffer's Senior Equity Analyst Joe Bell, CMT. "The good news was that small-caps and technology led the way, which is a positive sign, as they are the growth sectors of the market and have led for much of the past couple of years." Following the latest round of earnings reports, the Dow Jones Industrial Average (DJI) finished in negative territory, after two consecutive days of triple-digit gains.

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

plus...
    Weekly jobless claims dropped to a six-week low, consumer prices notched their largest gain since mid-2013, and eleventh-hour option bulls pounced on Groupon Inc ( GRPN ) .

The Dow Jones Industrial Average (DJI - 16,417.01) tumbled at the opening bell, and shed 64.9 points, or 0.4%, for the day. The Dow's 10 advancers were led by McDonald's Corporation's ( MCD ) gain of 0.6%, while UnitedHealth Group Inc. ( UNH ) paced the 19 decliners with an earnings-induced loss of 2.8%. Cisco Systems, Inc. (CSCO) remained unchanged.

The S&P 500 Index (SPX - 1,845.89) also spent the day south of breakeven, and closed 2.5 points, or 0.1%, lower. Conversely, the Nasdaq Composite (COMP - 4,218.69) tagged yet another 13-year intraday high of 4,219.28, and added 3.8 points, or 0.1%, for the session.

Elsewhere, the CBOE Volatility Index (VIX - 12.53) gained ground right out of the gate, and finished 0.3 point, or 2%, higher.

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

A Trader's Take :

"If you were anywhere near a solar stock today, count yourself lucky," mused Bell. "That sector bucked the trend, and many of those stocks had a massive jump. Much of the rally has been attributed to China mulling incentives and positive analyst comments. Although this sector was incredibly strong in 2013, anyone willing to ride out this trend was very happy today."

5 Items on Our Radar Today :

  1. During one of his final public speaking engagements, Fed Chairman Ben Bernanke defended the central bank's stimulus measures over the past five years. "Markets are broadly within historical ranges, the financial system is stable and firms are well-capitalized," he stated in a Q&A session at the Brookings Institute in Washington, D.C. (Fox News)
  2. The Labor Department said initial jobless claims unexpectedly fell by 2,000 last week to a seasonally adjusted 326,000, marking their lowest level in six weeks. Meanwhile, the four-week moving average for first-time filings dropped by 13,500 to 335,000. (MarketWatch)
  3. A separate report showed that the consumer price index (CPI) climbed by a seasonally adjusted 0.3% in December, denoting the largest monthly gain since last June. Excluding food and energy costs, core prices edged up 0.1%. (USA Today)
  4. Lackluster holiday sales triggered a steep drop for Best Buy Co., Inc. (BBY) , along with a bearish brokerage note.
  5. Groupon Inc ( GRPN ) attracted front-month speculators, who wagered on last-minute gains for the daily deals name.

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 :

Crude futures edged lower, as investors mulled over a production report from OPEC. The February contract shaved off 21 cents, or 0.2%, to close at $93.96 per barrel.

Meanwhile, a sluggish market and a weaker dollar pushed gold futures higher, with February-dated gold adding $1.90, or 0.2%, to finish at $1,240.20 an ounce.

SCHAEFFER'S MARKET POSTURE



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This article appears in: Investing , Options

Referenced Stocks: AMD , GRPN , MCD , TWTR , UNH

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