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Dow Spikes 245 to Multi-Year High on ECB, Jobs Data
By: Schaeffer's Investment Research
At one point this afternoon, the
Dow Jones Industrial Average (DJI)
was up roughly 246 points, and by the close, the blue-chip
barometer solidified a near five-year best settlement. As
Schaeffer's Senior Equities Analyst Joe Bell points out, today's
action centered around the European Central Bank (ECB) president:
"This morning, Mr. Draghi confirmed the rumors and announced that
the ECB would buy bonds with maturities shorter than three years.
Throw in the news of better-than-expected jobs numbers on the
domestic front, and you have a lot of participants buying hand over
Click through to see what else was on our radar today:
- Bearish sentiment continues to rail against this broad-market upswing ... check out the new installment of Trader TV for more.
- Option Volume Briefs : put buying ramps up on the Financial Select Sector SPDR (NYSEARCA:XLF).
The Dow Jones Industrial Average (DJI - 13,292.00) rocketed to its intraday acme of 13,294.13, and maintained all but a few points of this upswing, advancing 244 points, or 1.9%, by the time the dust settled. All 30 blue chips took a step higher today, with Bank of America ( BAC ) and Cisco Systems, Inc. ( CSCO ) leading the bullish parade with gains of 5% and 4.4%, respectively.
In last-minute trading, the S&P 500 Index (SPX - 1,432.12) ran to a more than four-year acme, adding 28.7 points, or 2%, by the closing bell.
Turning in the best performance of its fellow benchmarks, the Nasdaq Composite (COMP - 3,135.81) rallied 66.5 points, or 2.2%, to settle at its highest perch since mid-November 2000.
The CBOE Market Volatility Index (VIX - 15.60) dipped to its lowest close in almost two weeks, peeling back 2.1 points, or 12.1% on the day.
Today's highlight : "I'm not sure if the vocal bears know , but this market just made a new four-and-a-half-year high this morning," said Bell. "Despite the constant naysayers, the resilience of this market has been incredible as the steady uptrend continues."
Turning to today's major market stories...
- Weekly Contrarian : Can Abercrombie & Fitch Prove the Skeptics Wrong?
- Tech and Internet bigwigs Amazon.com, Inc. ( AMZN ) and Google Inc ( GOOG ) were among Wall Street's standouts.
- Analysts adjusted their positions on computer services issue VeriSign, Inc. ( VRSN ) and electronic payments provider VeriFone Systems Inc (PAY) .
- A short strangle was constructed on SanDisk Corporation (SNDK) .
- Downtrending Peabody Energy Corporation (BTU) could fall even lower, should the remaining bullish sentiment begin to unravel.
- Bears Target the Financials : looking in on options activity for the Financial Select Sector SPDR (NYSEARCA:XLF).
- What's a binary option, and where can I get one ?
For today's activity in commodities, options, and more, head to page 2.
Crude futures turned higher for a second straight day, following the Energy Information Administration (EIA) report of a bigger-than-projected drop in weekly crude supplies. The commodity also found support from the European Central Bank's (ECB) bond-buying program, as well as the upbeat jobs data and payroll report. Although the rally weakened as the session wore on, October-dated oil added 17 cents, or 0.2%, to end at $95.53 a barrel.
The ECB's plan to aid economically strapped euro-zone nations also buoyed gold futures today. While the euro strengthened with the news, gold for December delivery gained $11.60, or 0.7%, to settle at $1,705.60 an ounce. This marked precious metal's highest point since March 9.
Levels to watch in trading...
Dow Jones Industrial Average (DJI - 13,292.00)
- support at 11,500; resistance at 14,000
S&P 500 Index (SPX - 1,432.12)
- support at 1,100; resistance at 1,500
- Nasdaq Composite (COMP - 3,135.81) - support at 2,400; resistance at 3,400
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.