"Well, it's a good thing the
Dow Jones Industrial Average (DJI)
added Nike (
), because that was about the only bright spot," lamented
Schaeffer's Senior Technical Strategist Ryan Detrick, CMT. "It was
a bad week for big-caps, and today just added to the pain. After a
huge start to September, we've definitely hit a weak patch all of a
sudden. Uncertainty regarding a potential government shutdown and
more Washington drama sure isn't helping much here." As a result,
the Dow finished in the red for both the day and week.
Continue reading for more on today's market, including
- Is Gilead Sciences (
) poised to trek higher? Schaeffer's Senior Options Strategist
Tony Venosa, CMT, makes a bullish case for the biopharmaceutical
concern in his latest
Chart of the Day
- Near-term options bulls continue to descend upon
in droves, despite the tech giant's lingering technical
In case you missed it:
"Sometimes the obvious trade isn't the best trade." Read more of
Detrick's pearls of wisdom as he highlights the
keys to being a successful trader
The Senate approved its stopgap spending bill, consumer
sentiment dropped on a month-over-month basis, and Nike (
) received a round of earnings-induced bullish brokerage
Dow Jones Industrial Average (DJI - 15,258.24)
spent the entire session parked in the red, and sank to an intraday
low of 15,211.81 around 10:00 a.m. ET. By the closing bell, the
blue-chip barometer was down 70.1 points, or 0.5%. For the week,
the index dropped 1.2% -- its first negative weekly finish in a
month. Nike (
) led the Dow's five advancers with an earnings-induced gain of
4.7%, while Cisco Systems (
) once again paced the 25 decliners with a loss of 1.9%.
S&P 500 Index (SPX - 1,691.75)
stayed in negative territory throughout the day, touching a session
low of 1,687.11 within the first hour of trading. By the close, the
index shed 6.9 points, or 0.4%. Meanwhile, the
Nasdaq Composite (COMP - 3,781.59)
declined 5.8 points, or 0.2%. On a weekly basis, the SPX closed
1.1% lower -- snapping a three-week winning streak -- while the
Nasdaq edged 0.2% higher.
CBOE Market Volatility Index (VIX - 15.46)
sang a different tune, climbing higher right out of the gate. The
"fear gauge" advanced 1.4 points, or 10%, on the day.
Week-over-week, the VIX gained 17.8%, and closed above its 20-week
moving average for the first Friday in three.
A Trader's Take
"Next week could be full of fireworks," Detrick noted. "If the
government shuts down, it isn't the end of the world, as it has
happened before. One thing to remember is that government data
could be put on hold or won't be as accurate. Given the fact that
everyone is so focused on data, with the Fed closely scrutinizing
all the numbers, things could get very interesting, as uncertainty
crops up everywhere."
3 Things to Know About Today's Market
- The Senate passed its
stopgap spending bill
today, in an effort to avoid a potential government shutdown.
However, the approved bill -- which would be in effect through
mid-November -- drew criticism from House Republicans, as it
omitted a provision that would strip funds away from Obamacare.
Nevertheless, conservatives in the Senate aren't giving up
without a fight. "This vote is not the end. It's not even the
beginning of the end," stated Sen. Mike Lee (R-Utah). The vote to
eliminate the defunding language was tallied at 54 to 44.
- Yet another Fed official offered his opinion on the
continued tapering drama
. This time it was Chicago Fed President Charles Evans, who
opined that the central bank may not decide to reduce its
bond-buying program until early next year. Evans, a voting member
of the Federal Open Market Committee (FOMC), noted during a
speech in Oslo that while the Fed's decision not to taper was "a
close call," it was "very much in keeping with [the central
bank's] overall intention in the program that it's open-ended."
- The final September reading for the Thomson
Reuters/University of Michigan's
consumer sentiment index
arrived at 77.5, up from the preliminary figure of 76.8. However,
the latest reading denotes a drop from August's figure of 82.1,
and marked the index's lowest final reading since April.
Economists, on average, were expecting a final figure of 78.0.
"While few consumers expected a federal shutdown, complaints
about government policies have risen, and more importantly,
prospects for job growth have diminished," noted survey director
5 Stocks We Were Watching Today
stronger-than-expected quarterly earnings report triggered a slew
of bullish brokerage notes this morning.
- Option bulls flocked toward
following news that its PayPal unit acquired Braintree Payment
- Just one week after being ousted from the Dow,
Bank of America (BAC)
received some bearish analyst attention.
- Put buyers targeted
Sirius XM Radio (SIRI)
, and wagered on a longer-term decline for the satellite radio
poor price action sparked an influx of short-term option volume,
with a focus on December puts.
For a look at today's options movers and commodities
activity, head to page 2.
Crude futures edged lower today, as worries over a potential
government shutdown weighed on black gold prices. By the time the
dust settled, November-dated oil shaved off 16 cents, or 0.2%, to
end at $102.87 per barrel. For the week, crude shed 1.8%.
Conversely, gold futures finished higher, thanks to Chicago Fed
President Charles Evans' suggestion that the central bank could
hold off tapering until early 2014. Gold for December delivery
added $15.10, or 1.1%, to close at $1,339.20 an ounce. On a weekly
basis, the malleable metal climbed 0.5%.