Stocks Fight Their Way Into the Black, But Fail to Reach New All-Time Highs

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Mixed news out of Washington -- on Capitol Hill and from the Commerce Department -- inspired a choppy day of trading, where the Dow Jones Industrial Average (DJI) vacillated on either side of breakeven, particularly as the closing bell approached. When all was said and done, though, the bulls proved victorious, with the blue-chip index tacking on 18.7 points.

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

  • Now that Ben Bernanke's prepared remarks have been released, will we face a "summer lull?" Schaeffer's Senior Trading Analyst Bryan Sapp weighs in.
  • Option players can't choose a side ahead of Advanced Micro Devices ( AMD ) earnings .
  • And, in case you missed it, Schaeffer's contributor Adam Warner surveyed the Google ( GOOG ) options landscape ahead of earnings.
plus...
    Ben Bernanke is flexible, housing starts are dropping, and General Electric ( GE ) options pits are active ahead of earnings.

The Dow Jones Industrial Average (DJI - 15,470.52) finished a roller-coaster session with a gain of 18.7 points, or 0.1%. Eighteen of the Dow's 30 blue chips settled in the black, led by DuPont ( DD ), which gained 5.3% on news of a large stake from Nelson Peltz. Meanwhile, American Express ( AXP ) paced the 11 decliners, shedding 1.9%, while Pfizer (PFE) finished flat.

The S&P 500 Index (SPX - 1,680.91) added 4.7 points, or 0.3%, by the bell, marking the index's ninth gain in 10 sessions. The Nasdaq Composite (COMP - 3,610.00) fared the best of the three, advancing 11.5 points, or 0.3%, after notching a new 12-year high of 3,615.79 earlier in the session.

The CBOE Market Volatility Index (VIX - 13.78) surrendered its short-lived perch north of 14, giving up 0.6 point, or 4.4%.

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

3 Things to Know About Today's Market :

  • Hoping for a clue on the "tapering" front, investors were all ears as Federal Reserve Chairman Ben Bernanke delivered prepared remarks before the U.S. House of Representatives Financial Services Committee. The overall theme expressed was one of flexibility, as the Fed boss noted that bond-buying efforts are "by no means on a preset course," and that any decisions to pare back the asset purchases are dependent on economic factors. Bernanke also noted that interest rates will hover near zero for the foreseeable future, assuming inflation remains at bay. (Reuters)
  • Housing starts dropped to a 10-month low in June, falling 9.9% from the previous month to a seasonally adjusted annual rate of 836,000. The reading fell short of economists' expectations. On a year-over-year basis, however, housing starts grew by 10.4%, according to data from the Commerce Department. (USA Today)
  • The Federal Reserve's "Beige Book" revealed an expansion in manufacturing activity at the majority of the 12 regional districts and a "modest to moderate pace" of economic growth overall. This language was unchanged from the last report, which was issued on June 5. (Bloomberg)

5 Stocks We Were Watching Today :

  1. Short-term call buyers descended upon General Electric ( GE ) , with earnings due Friday morning.
  2. Options trading activity spiked on Tesla Motors (TSLA) following Tuesday's plunge in the shares.
  3. One Micron Technology (MU) bull placed a large long-term trade.
  4. After its earnings release, Yahoo! (YHOO) was greeted with several price-target hikes.
  5. Hopeful call buyers targeted a long-term recovery in Barrick Gold (ABX) shares.

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 :

In response to a larger-than-expected drop in crude inventories last week, oil futures muscled higher today. By the close, August-dated crude had gained 48 cents, or 0.5%, to settle at $106.48 per barrel.

Gold was not as fortunate, moving modestly lower as investors digested Bernanke's remarks before Congress. Gold for August delivery lost $12.90, or 1%, to close at $1,277.50 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.

All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.


This article appears in: Investing , Options

Referenced Stocks: AMD , AXP , DD , GE , GOOG

Schaeffer's Investment Research

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