Tech Sector Strength Pushes Dow, S&P 500 Higher

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"What can you say, the market continues to hold up," mused Schaeffer's Senior Technical Strategist Ryan Detrick, CMT. "Today was a pretty boring session, but in the end it was probably nice for the market to catch its breath after the rally it has had during the past two weeks. Overall, the big headlines this week have been earnings, and that will continue next week." Against this backdrop, the Dow Jones Industrial Average (DJI) finished the day -- and week -- in positive territory.

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

  • Zynga Inc's ( ZNGA ) earnings beat prompted option bulls to wager on further upside for the online gaming giant over the next week.
  • Near-term speculators forecast higher highs for Visa Inc ( V ) following its upcoming turn in the earnings confessional.
  • In case you missed it: This week's edition of Small-Cap Standout highlights three outperforming stocks that could benefit from lingering skepticism.
plus...
    Consumer sentiment hit its lowest level in nearly a year, Microsoft Corporation ( MSFT ) topped consensus earnings estimates, and option bulls converged on Cisco Systems, Inc. ( CSCO ).

The Dow Jones Industrial Average (DJI - 15,570.28) experienced some choppy price action, but managed to stay in the green for the entire session. By the end, the index was up 61.1 points, or 0.4%, to close just below its intraday high. Microsoft Corporation ( MSFT ) led the Dow's 21 advancers with an earnings-induced gain of 6%, while The Procter & Gamble Company's ( PG ) 0.8% loss paced the eight decliners. Pfizer Inc. (PFE) remained unchanged. For the week, the blue-chip bellwether added 1.1%.

Similarly, the S&P 500 Index (SPX - 1,759.77) was parked north of breakeven throughout the day, and managed to tag a record intraday peak of 1,759.82 just before closing 7.7 points, or 0.4%, higher. The SPX also notched an all-time closing high. Meanwhile, the Nasdaq Composite (COMP - 3,943.36) finished with a gain of 14.4 points, or 0.4% -- touching another 13-year intraday high of 3,961.10 along the way. The indexes tacked on 0.9% and 0.7% for the week, respectively.

Elsewhere, the CBOE Volatility Index (VIX - 13.09) spent most of the session in positive territory, but edged down 0.1 point, or 0.8%, by the closing bell. On a weekly basis, the "fear barometer" gained 0.4%, but finished a second consecutive week below its 20-week moving average.

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

A Trader's Take :

"Amazon.com, Inc. (AMZN) reported explosive revenue growth, and that sparked a huge gap and move to new highs for the shares," Detrick noted. "This, of course, pushed the Nasdaq once again to new 13-year highs. You can't argue with that. The other group we like is small-caps. The Russell 2000 (RUT) was up for its eighth week in a row. That is very significant, because nine is the all-time record, most recently achieved in 1996. This year has seen many records go down, so stay tuned to see if that is the next record to fall."

3 Things to Know About Today's Market :

  • Senator Rand Paul (R-Ky) threatened to block the nomination of Janet Yellen for Federal Reserve chairman today. " ... I will request a vote on my bipartisan Federal Reserve Transparency Act, S. 209. The American people deserve a transparency from the federal reserve and the federal government as a whole," the senator said in a statement. (CNBC)
  • The final October reading for the Thomson Reuters/University of Michigan's consumer sentiment index arrived at a lower-than-expected 73.2, down from September's reading of 77.5. This latest figure marked the index's lowest level since December 2012. (MarketWatch)
  • Microsoft Corporation ( MSFT ) reported fiscal first-quarter earnings of $5.2 billion, or 62 cents per share, compared to $4.5 billion, or 53 cents per share, in the year-ago period. Meanwhile, revenue climbed 16% to $18.5 billion. Analysts, on average, were expecting earnings of 54 cents per share on sales of $17.8 billion. (Reuters)

5 Stocks We Were Watching Today :

  1. Amazon.com, Inc. (AMZN) enjoyed a round of bullish brokerage notes following last night's well-received quarterly revenue results.
  2. Traders bet on General Electric Company (GE) to rise by mid-January -- which coincides with the firm's next earnings report.
  3. A weaker-than-expected 2014 forecast from Sirius XM Radio Inc (SIRI) triggered a pair of downgrades for the stock.
  4. Cisco Systems, Inc.'s ( CSCO ) short-term call activity surged, as speculators showed an affinity for the security's weekly options.
  5. Some positive price action for Intel Corporation (INTC) -- and inexpensive option premiums -- attracted November call buyers.

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 extended yesterday's gains, despite some lingering unease over increasing oil supplies. By the time the dust settled, the December contract added 74 cents, or 0.8%, to end at $97.85 per barrel. For the week, however, crude shed 2.9% -- its third straight weekly decline.

Meanwhile, gold futures secured yet another five-week closing high, as weak consumer sentiment data boosted the precious metal's "safe haven" appeal. December-dated gold edged up $2.20, or 0.2%, to finish at $1,352.50 an ounce. On a weekly basis, gold advanced 2.9%.

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: CSCO , MSFT , PG , V , ZNGA

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