Day Traders Diary


The major averages ended in mixed fashion as the Dow shed 0.1% while the Nasdaq added 0.5%. For its part, the S&P 500 ended flat.

Equities held their levels into the afternoon as market participants awaited the Minutes from the June 18/19 meeting of the Federal Open Market Committee. Most notably, the Minutes indicated several members judged a reduction in asset purchases would be warranted 'soon.' However, the Fed will continue to look for more evidence suggesting projected acceleration of growth remains on track before tapering.

With regard to Treasury yields, some participants voiced concern about a few institutions being ill-prepared to handle a rapid run-up in rates. In addition, other members said that 'a prolonged period of low interest rates would encourage investors to take on excessive credit or interest rate risk and would distort some asset prices.'

Committee participants also stressed their desire to emphasize the distinction between decisions about slowing bond buying and future rate hikes.

Overall, the Minutes did not provide too much fresh insight. With that in mind, the major averages returned to their earlier levels after spiking to fresh highs immediately after the Minutes crossed the wires.

Energy and financials displayed weakness throughout the day before settling near their lows. The energy sector shed 0.6% despite the continued rise in crude oil, which added 2.4% to $106.04 per barrel. The energy component has rallied steadily since late June, and reports of a well leak off the coast of Louisiana contributed to today's strength.

Elsewhere, major banks registered losses across the board as the financial sector settled lower by 0.6%.

Also of note, the Dow Jones Transportation Average fell 1.0% after jumping 2.3% yesterday.

While most cyclical groups finished in the red, the technology sector outperformed with a gain of 0.5% as most of its top components registered gains. Qualcomm (QCOM 60.46, +1.08) ended higher by 1.8% after providing leadership throughout the session.

Countercyclical consumer staples, health care, and utilities added between 0.1% and 0.7% while the telecom services sector shed 0.4%.

May wholesale inventories decreased 0.5% while the consensus expected an uptick of 0.3%. Today's report followed last month's revised decrease of 0.1%.

Tomorrow, weekly initial claims, June import prices ex-oil, and export prices ex-agriculture will be reported at 8:30 ET. In addition, the Treasury will release its June budget at 14:00 ET.

The U.S. Treasury will auction $13 billion in 30-yr bonds. 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.