|Back to main|
S&P Tags Another New Record on a Light-News Day
By: Schaeffer's Investment Research
"All in all, it was a boring yet constructive day, as small-caps
quietly led," noted Schaeffer's Senior Technical Strategist Ryan
Detrick, CMT. "That is always nice to see, as small-caps are more
aggressive by nature. So under the surface, today was a solid win
for the bulls after the strength we saw at the end of last week."
On the blue-chip front, the
Dow Jones Industrial Average (DJI)
traded in a relatively narrow range, digesting last week's gains
and closing just a shade below breakeven.
Continue reading for more on today's market, including :
- Our CEO and Founder Bernie Schaeffer analyzes the current market conditions of the Big 3: Gold, Stocks, and Bonds .
- Senior Trading Analyst Bryan Sapp reflects on the 2010 flash crash and offers his insight on the trading week ahead .
- Bullish Bank of America ( BAC ) speculators think a new annual high is right around the corner.
- Markets catch their breath, New York's attorney general gets tough, and Groupon ( GRPN ) bulls place pre-earnings bets.
The Dow Jones Industrial Average (DJI) traded in a 48-point range today and bounced back and forth between negative and positive territory. By the closing bell, the Dow had dropped 5.1 points, or less than 0.1%, to settle at 14,968.89. Fourteen of the Dow's 30 components finished higher today, led by Bank of America ( BAC ), which gained 5.2%. At the back of the pack was Merck ( MRK ), down 1.5% today.
The S&P 500 Index (SPX) hit another all-time record peak of 1,619.77 before ending the session at 1,617.50, up 3.1 points, or 0.2%. The SPX has now closed higher in five of the last six sessions. Turning to tech stocks, the Nasdaq Composite (COMP) added 14.3 points, or 0.4%, to 3,392.97. In intraday action, the COMP reached another 12-year high of 3,396.21.
The CBOE Market Volatility Index (VIX) gave back 0.2 point, or 1.5%, to 12.66, its lowest close since April 12.
A Trader's Take :
"Banks were the big winner, after Bank of America ( BAC ) gained more than 4% on news they had reached a settlement with MBIA ( MBI )," observed Detrick. "The more defensive names, meanwhile, were the laggards, as utilities and drug stocks were sold pretty hard. At the same time, these groups have been on a tear, so some profit-taking here makes sense. Still, this could be a sign that money wants to rotate from the more defensive areas back to aggressive areas, which could be a positive development."
3 Things to Know About Today's Market :
- BMC Software ( BMC ) will be taken private for $6.9 billion, or $46.25 per share. A group of private-equity firms, including Bain Capital, are combining forces to acquire the software firm for an unimpressive premium of 1.8% to the stock's Friday close. (CNNMoney)
- The attorney general of New York vowed to sue Bank of America ( BAC ) and Wells Fargo (WFC) for their alleged violation of the $26-billion National Mortgage Settlement between five banks and 49 state attorneys. Both stocks brushed off the news, finishing higher on the day. (The New York Times)
- The S&P 500 Index (SPX) is being reshuffled as Coventry Health Care (NYSE:CVH) gets absorbed by Aetna Inc. (AET). After Wednesday's close, Macerich Co. (MAC) will take its place in the index, while CVH is removed. (Bloomberg)
5 Stocks We Were Watching Today :
- Call buyers wagered on short-term upside in Intel Corporation (INTC).
- Option buyers bet that Sirius XM Radio (SIRI) will soon reach new five-year highs .
- LinkedIn Corp (LNKD) earned another vote of confidence this morning, as Wunderlich boosted its price target by $10.
- Weekly Groupon Inc ( GRPN ) call options were notably popular ahead of the company's earnings report.
- An Advanced Micro Devices (AMD) long strangle buyer expects increased volatility over the next seven weeks.
For a look at today's options movers and commodities activity, head to page 2.
Crude futures advanced today, pushed higher by rising geopolitical concerns out of the Middle East. Following reports of Israeli air strikes on Syria, oil for June delivery rose 55 cents, or 0.6%, to finish at $96.16 per barrel -- the contract's highest closing price in a month.
Gold prices also muscled higher, recovering from Friday's modest dip. June-dated gold gained $3.80, or 0.3%, to end the day at $1,468 per ounce.