Day Traders Diary


The S&P 500 gained 0.5% to punctuate a week which saw the index climb over 4.0%. Today's advance was notable as it took the benchmark average to its best close since December 2007. The weeklong rally arrived after Washington lawmakers were able to avoid the fiscal cliff by agreeing to a tax plan. However, it should be noted that the country is nearing the debt ceiling, which sets up the stage for another lengthy debate during the first quarter of the year.

Today's session saw some notable moves as the SPDR Financial Select Sector ETF (XLF 17.05, +0.20) gained 1.2% and settled at its highest level since February 2011.

Also of note, the tech sector was the only declining space in the S&P 500 after Apple (527.00, -15.10) slid 2.8%. The weakness followed comments from Deutsche Bank's Japan unit which believes the company will report disappointing end-of-year sales. The weakness spilled over to several Apple suppliers as Cirrus Logic (CRUS 28.32, -1.03) and Skyworks Solutions (SWKS 20.95, -0.54) lost 3.5% and 2.5% respectively.

Next week, investors will turn their attention to fourth quarter earnings as Alcoa (AA 9.26, +0.19) is scheduled to kick-off the earnings season after Tuesday's close. The Capital IQ consensus expects the aluminum producer to report earnings of $0.07 on $5.64 billion in revenue.

On Monday afternoon, we published a review of the global market performance in 2012. For those who missed it, we would like to revisit the report and look back at the past year:

2012 proved to be a positive year for world equities despite a number of macroeconomic challenges. Markets across the globe registered strong gains as Germany's DAX and Greece's ASE General Index both added over 30%. Domestically, the S&P 500 registered a solid 13% gain, and was slightly outperformed by the Nasdaq and Russell 2000. The renewed worries regarding the weakening fundamentals of the Eurozone persisted into the summer and weighed on market sentiment. However, late-summer efforts from the European Central Bank and the Federal Reserve alleviated some of the fears, and propelled the markets to a strong second-half performance. The rally was cut short after the election, when the market focus turned to the budget debate, which lasted into the New Year. Below we summarize some of the key developments, which contributed to market sentiment.

All comments contained herein are for informational purposes only, and should not be considered as a solicitation to buy or sell any security. The firm does not guarantee the accuracy or completeness of the information or make any warranties regarding results from it's usage.