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Dow Advances in Light-Volume Session; Which Stocks Fared the Best?
By: Schaeffer's Investment Research
Dow Jones Industrial Average (DJI)
muscled steadily higher as the session progressed, as Wall Street
celebrated reports of a cease-fire in the Gaza Strip. After more
than a week of fighting, Israel and Hamas agreed to call a halt to
air strikes and missile attacks, with negotiations brokered by
Egyptian Foreign Minister Mohamed Amr and U.S. Secretary of State
Hillary Clinton. Against this backdrop, stocks ended a lightly
traded session on a high note, with the S&P 500 Index (SPX)
extending its winning streak to four sessions.
Continue reading for more on today's market events, including :
- Daily Game Plan : Schaeffer's Senior Trading Analyst Bryan Sapp outlines 8 relative-strength winners of the day.
- Chart of the Day : Senior Options Strategist Tony Venosa, CMT, explains why this medical device maker could be facing "gap resistance."
- In Focus : Why advisor sentiment is in a bullish sweet spot .
- Everything You Need to Know : Your one-stop shop for levels to watch, economic data, earnings reports, stocks on the move, and commodities action.
The Dow Jones Industrial Average (DJIA) finished with a gain of 48.4 points, or 0.4%, ending north of 12,800 for the first time since Nov. 12. All but six of the Dow's 30 components settled higher, led by Hewlett-Packard's ( HPQ ) 2% rebound. On the flip side, DuPont ( DD ) paced the bearish minority, giving up 0.9%.
Likewise, the S&P 500 Index (SPX) added 3.2 points, or 0.2%, while the Nasdaq Composite (COMP) gained nearly 10 points, or 0.3%.
The CBOE Market Volatility Index (VIX) also turned higher, tacking on about 2% to snap its three-session decline.
A Trader's Take
"Overall, most market participants are more concerned with turkey than they are about which stocks to buy and sell," said Schaeffer's Senior Equity Analyst Joe Bell.
"We had little reaction to this morning's unemployment claims data, which came in slightly better than expected," he continued. "The SPX managed to trade slightly higher and continue its short-term momentum from the past few trading days. After several weeks of selling, the market has actually managed three days of pretty nice price action. Bulls welcome the relief rally, but most people are once again looking forward to lots of food, time with family, and plenty of football."
Economic and Earnings News
In the week ended Nov. 17, as the East Coast continued to dig out from Superstorm Sandy, initial jobless claims were off 41,000 to 410,000, in line with the average estimate. Meanwhile, the previous week's claims were upwardly revised to 451,000 from 439,000. This marks the first time in more than a year that claims have remained above 400,000 for two consecutive weeks, though the Sandy impact is likely a factor. Taking a broader look, the four-week moving average tracking initial claims was higher by 9,500, at 396,250.
The Thomson Reuters/University of Michigan consumer sentiment index backpedaled to 82.7 at the end of November, down from the mid-month reading of 84.9. Economists had predicted a smaller decline to 83.5; however, the index is still hovering just north of its final October perch at 82.6.
The Conference Board's index of leading economic indicators edged up 0.2% in October, matching the consensus estimate of economists. However, September's gain was downwardly revised to 0.5% from the originally reported 0.6%. "Based on current trends, the economy will continue to expand modestly through the early months of 2013," said Conference Board economist Ken Goldstein.
More Stocks Making News :
- The downgrades kept coming for Dow component Hewlett-Packard ( HPQ ) .
- Analysts at Macquarie waxed optimistic on Yum! Brands ( YUM ) .
- Chipotle Mexican Grill ( CMG ) is doubling its stock buyback program.
- Twinkie turmoil translated into a boon for Hostess rival Flowers Foods ( FLO ) .
For today's activity in commodities, options, and more, head to page 2.
In the Options Pits
- Option speculators gambled on short-term support for Google (GOOG) .
- Bullish traders took a shine to Mosaic (MOS) .
- Investors are showing an appetite for Green Mountain Coffee Roasters (GMCR) calls.
- Skeptics called a near-term top for Cirrus Logic (CRUS) .
- Likewise, Groupon (GRPN) garnered attention from long-term call writers.
Oil futures pared a portion of yesterday's losses, thanks to a surprise decline in domestic stockpiles. Specifically, oil inventories dropped for the first week in three, falling by 1.5 million to 374.5 million barrels, compared to economists' expectations for a million-barrel increase. Black gold spent part of the session in the red, as news of a cease-fire between Israel and Hamas eased concerns about supplies in the region. By the close, January-dated oil added 63 cents, or 0.7%, to end at $87.38 per barrel.
Gold futures also bounced back from yesterday's drubbing, as data from the International Monetary Fund (IMF) showed that central banks in Brazil, Kazakhstan, and Russia boosted their gold reserves last month. By the close, gold for December delivery tacked on $4.60, or 0.3%, to finish at $1,728.20 an ounce.
At the end of every market day, the staff at Schaeffer's Investment Research reviews the trading day in detail, covering major events and key market developments. Don't miss this critical, timely and insightful report. If you enjoyed today's edition of Market Recap, sign up here for free daily delivery straight to your inbox.