Stocks Bounce Back on Strong Domestic Data

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"After yesterday's crash in the gold market and the broad-market sell-off, it was nice to see a bit of a relief rally today," said Schaeffer's Senior Equity Analyst Joe Bell. Some better-than-expected economic numbers helped lift the Dow Jones Industrial Average (DJI) nearly 160 points as it battled back from Monday's steep loss. Meanwhile, the S&P 500 Index (SPX) bounced back toward the top end of its familiar trading range between 1,550 and 1,575.

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

  • Schaeffer's Senior Trading Analyst Bryan Sapp discusses levels to watch now, and timing the next "big move" for stocks.
  • For those looking to buy gold after its pullback , our Senior Options Strategist Tony Venosa, CMT, outlines how to plot a long trade in the SPDR Gold Trust (NYSEARCA:GLD).
  • And speaking of the GLD, was smart money betting against gold at just the right time?


  • Stocks pare some of Monday's losses, new home sales surprise to the upside, and Intel ( INTC ) traders are hopeful ahead of earnings.

The Dow Jones Industrial Average regained more than half of Monday's losses, adding almost 158 points, or 1.1%, to close at 14,756.78. This was just shy of the index's intraday peak and back above its 10-day moving average. All but two of the Dow's 30 components moved higher on the day, led by Coca-Cola ( KO ), which added 5.7% after its earnings report. Verizon Communications ( VZ ) was the day's biggest loser, dropping 0.4% despite hitting a new 52-week high in intraday trading.

The S&P 500 Index (SPX) moved higher as well, tacking on 1.4%, or 22 points, to close at 1,574.57. The Nasdaq Composite (COMP) was the best-performing index by a slight margin, adding 1.5%, or 48 points, to end the day at 3,264.63.

After yesterday's mammoth move, the CBOE Market Volatility Index (VIX) spiraled lower today, falling back 3.3 points, or 19%, to 13.96.


A Trader's Take :

"Materials and commodity stocks led the way today, as they attempted to dig themselves out of the hole they dropped into on Monday," noted Bell. "Elsewhere, we had a mixed day on the earnings front, but were greeted by some better-than-expected housing data this morning. Housing-related stocks have hit some speed bumps in the past couple of months, so this was nice to see," he added.

3 Things to Know About Today's Market :

  • Housing starts -- a measure of new residential construction -- jumped 7% in March to a seasonally adjusted annual figure of 1.04 million, reflecting a year-over-year increase of roughly 46%. The figure was above economists' projections and was the fastest pace in nearly five years. (Los Angeles Times)
  • The Consumer Price Index, or CPI, edged 0.2% lower in March, according to the Labor Department. What's more, prices have gained just 1.5% in the last 12 months, as inflation has remained at bay. (CNN Money)
  • Goldman Sachs ( GS ) booked a first-quarter profit of $4.29 per share (excluding items), on revenue of $10.09 billion. Both figures topped analysts' expectations. (CNBC)

5 Stocks We Were Watching Today :

  1. Apple Inc. ( AAPL ) was swatted with price-target reductions at two brokerage houses this morning.
  2. Pre-earnings call buyers hope Intel Corporation ( INTC ) will buck its standing post-earnings trend.
  3. With earnings due Thursday, Nokia Corporation (NOK) was targeted for short-term gains by option bulls.
  4. Long-term call buyers expressed optimism on the future of Yahoo! Inc. (YHOO).
  5. Green Mountain Coffee Roasters (GMCR) captured the attention of in-the-money call buyers today.

For a look at today's options movers and commodities activity, head to page 2.


Commodities :

Ahead of tomorrow's weekly inventories report, oil futures were little changed, failing to rebound after Monday's decline. May-dated crude edged up 1 cent to close at $88.72 per barrel.

Gold futures bounced back today -- but not by much, relative to their two-day drop of more than $200 an ounce. By the close, June-dated gold had gained $26.30, or 1.9%, to $1,387.40 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.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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