Yellen Testimony Pushes Stocks to Higher Highs

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"As expected, Fed Chair nominee Janet Yellen offered a rather dovish stance to the Senate Banking Committee," noted Schaeffer's Senior Technical Strategist Ryan Detrick, CMT. "This didn't rock the boat too much, and as a result, the bulls came out once again. In the process, the Dow Jones Industrial Average (DJI) and the S&P 500 Index (SPX) both hit new all-time highs, so we can't complain too much there."

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

  • The latest Short Interest Update highlights three outperforming stocks that could benefit from increased levels of skepticism on the Street.
  • Apple Inc. ( AAPL ) shares climbed higher today , despite news that the tech giant is being investigated by Italian authorities for alleged tax fraud.
  • Last-minute option bulls rolled the dice on Amazon.com, Inc. ( AMZN ), predicting additional gains by week's end for the Kindle guru.
plus...
    Fed Chair nominee Janet Yellen faced the Senate Banking Committee, weekly jobless claims fell less than expected, and Cisco Systems, Inc.'s ( CSCO ) downbeat earnings triggered a round of negative analyst notes.

The Dow Jones Industrial Average (DJI - 15,876.22) experienced another day of technical milestones, tagging an all-time intraday peak of 15,884.99. The blue-chip index went on to finish the session 54.6 points, or 0.4%, higher -- marking a record closing high yet again. The Home Depot, Inc. ( HD ) led the Dow's 23 advancers with a gain of 1.7%, while an earnings-induced loss of 11% for Cisco Systems, Inc. ( CSCO ) paced the seven laggards.

The S&P 500 Index (SPX - 1,790.62) also reached a record intraday high, rising to 1,791.53, and was up 8.6 points, or 0.5%, by day's end -- securing another all-time closing peak. Meanwhile, the Nasdaq Composite (COMP - 3,972.74) added 7.2 points, or 0.2%, and managed to tag a new 13-year peak of 3,975.89 in intraday trading.

Elsewhere, the CBOE Volatility Index (VIX - 12.37) spent the early morning hours north of breakeven, but faltered as the day went on, closing 0.2 point, or 1.2%, lower.

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

A Trader's Take :

"Cisco Systems, Inc. ( CSCO ) gapped lower on earnings, and this held tech stocks back," Detrick continued. "Still, overall, this earnings season once again came in better than the lowered expectations. We've seen this pattern play out for nearly three years now, as analysts get overly cautious ahead of earnings, and sure enough, earnings come in better than anticipated. Tomorrow is expiration Friday, so be sure to close out any open trades that might expire."

3 Things to Know About Today's Market :

  • Janet Yellen appears to have aced her hearing with the Senate Banking Committee today, as the Fed Chair nominee fielded questions about the central bank's bond-buying program, among other topics. One of her main sticking points for supporting current stimulus measures was the high unemployment rate, which she called "a virtually unprecedented situation." (CNNMoney)
  • President Barack Obama admitted that the recent rollout of his health care law was flawed, and told reporters, "We did fumble the ball on it and what I'm going to do is make sure we get it fixed." He also announced a change that will allow insurers to renew their policies for another year. (CNBC)
  • The Labor Department said initial jobless claims fell by 2,000 last week to a seasonally adjusted 339,000. Economists, on average, were expecting a drop to 335,000. Meanwhile, the four-week moving average for first-time filings dropped by 5,750 to 344,000. (MarketWatch)

5 Stocks We Were Watching Today :

  1. Cisco Systems, Inc. ( CSCO ) was hit with a round of bearish brokerage notes today, after reporting lackluster quarterly earnings last night.
  2. Our Weekly Contrarian explores the negative sentiment surrounding Netflix, Inc. ( NFLX ) , despite its technical prowess.
  3. Puts were popular on Wal-Mart Stores, Inc. (WMT) , following the retailer's turn in the earnings confessional this morning.
  4. Tesla Motors Inc (TSLA) leader Elon Musk was in the positive spotlight, despite the firm snagging a few negative headlines recently.
  5. Bullish speculators zeroed in on QUALCOMM, Inc. (QCOM) , and showed a particular interest in the stock's weekly call options.

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 today, as oil supplies increased for the eighth straight week. By the closing bell, the December contract shaved off 12 cents, or 0.1%, to end at $93.76 per barrel.

Meanwhile, gold futures snapped their five-day losing streak, thanks to weaker-than-expected jobless data, as well as Janet Yellen's remarks before the Senate Banking Committee. December-dated gold climbed $17.90, or 1.4%, to close at $1,286.30 per 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.

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This article appears in: Investing , Options

Referenced Stocks: AAPL , AMZN , CSCO , HD , NFLX

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