Stocks Finish Below Breakeven Amid Mixed Data

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"The major markets were mostly lower today, as we began the first full week of trading now that all of the big holidays are in the rearview mirror," observed Schaeffer's Senior Equity Analyst Joe Bell, CMT. "The ISM non-manufacturing index came in worse than expected, and November factory orders were right in line with consensus estimates. Although these might not have been major market drivers, they certainly didn't do much to curb the early negative momentum." As such, the Dow Jones Industrial Average (DJI) closed south of breakeven.

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    Service-sector growth slowed in December, factory orders hit a notable high, and Sirius XM Holdings Inc. ( SIRI ) call volume spiked amid news of a takeover offer.

The Dow Jones Industrial Average (DJI - 16,425.10) was parked in the red for most of the session, and was off nearly 45 points, or 0.3%, by the closing bell. The blue-chip index's 11 advancers were led by Goldman Sachs Group Inc ( GS ) -- which gained 0.7% -- while Microsoft Corporation (MSFT) led the 19 decliners with a loss of 2.1%.

The S&P 500 Index (SPX - 1,826.77) mimicked the path of the Dow, and shed 4.6 points, or 0.3%, for the day. Meanwhile, the Nasdaq Composite (COMP - 4,113.68) dropped 18.2 points, or 0.4%.

Aside from a few blips higher, the CBOE Volatility Index (VIX - 13.55) spent most of the day south of breakeven, and finished 0.2 point, or 1.5%, lower.

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

A Trader's Take :

"This is the first time in several weeks that the Dow has been down two days in a row," remarked Bell. "Much of the early selling was met with buying though, as many sectors finished well off their lows. The low-volatility uptrend that this market has been in is just incredible, so a little volatility and even a slight pullback has to be expected at some point."

5 Items on Our Radar Today :

  1. The Institute for Supply Management's (ISM) non-manufacturing index arrived at 53.0 in December, down from November's reading of 53.9. The latest reading also marked a six-month low for the index, and defied economists' expectations for a rise to 54.5. (Reuters via CNBC)
  2. The Commerce Department said factory orders climbed 1.8% in November, compared to a 0.5% decline in the month prior. The recent increase -- which drove the index to a record high -- was largely due to a 21.8% spike in aircraft orders. (USA Today)
  3. Apple Inc. (AAPL) was slapped with a rare bearish brokerage note at Standpoint Research ahead of the opening bell.
  4. News of a buyout bid drove call players to Sirius XM Holdings Inc. ( SIRI ) , with speculators betting on multi-month highs for the stock.
  5. BlackBerry Ltd (BBRY) saw a jump in weekly call buying, after the firm said it hired a former Sony Ericsson executive.

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 declined yet again today, as the possibility of increased oil production in Libya triggered supply concerns. By the closing bell, the February contract shaved off 53 cents, or 0.6%, to settle at $93.43 per barrel -- marking the lowest closing price of a most active contract since late November.

Meanwhile, gold futures finished lower following a "flash crash" earlier in the session, with February-dated gold losing 60 cents, or 0.1%, to end at $1,238 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: GS , JOSB , MW , SIRI , TWTR

Schaeffer's Investment Research

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