Day Traders Diary


Equities ended today's quiet session on a mixed note as the S&P 500 shed 0.1% while the Nasdaq added 0.3%.

Stocks began in the red after Japan's second quarter GDP report (0.6% actual, 0.9% forecast) missed expectations. Another piece of news out of Asia indicated the People's Bank of China could lower the reserve requirement ratio for small to mid-sized banks. Both items were perceived as beneficial to precious metals with Japan's below-consensus growth leaving the door open to further monetary easing while news from China discussed outright easing.

Gold futures advanced 1.8% while silver futures surged 4.6%, causing the precious metals to end at $1335.70 and $21.34 per troy ounce, respectively. In turn, miners rallied broadly as the Market Vectors Gold Miners ETF (GDX 28.01, +1.54) spiked 5.8%. However, the outperformance of miners was not enough to keep the materials sector (-0.2%) out of the red.

Similarly, most other growth-oriented sectors registered losses. Industrials and technology were the only exceptions as the two groups added 0.1% and 0.7%, respectively.

The industrial sector advanced as machinery producers and transportation companies displayed strength. Caterpillar (CAT 86.32, +1.81) rose 2.1%, and the Dow Jones Transportation Average tacked on 0.2%.

Elsewhere, the tech sector ended in the lead, contributing to the outperformance of the Nasdaq. The top-weighted sector (and index) component, Apple (AAPL 467.36, +12.91), settled higher by 2.8% following an International Trade Commission decision to issue an import and sale ban on some Samsung devices after the company infringed on Apple patents.

Remaining in the tech sector, BlackBerry (BBRY 10.78, +1.02) was another notable outperformer after the company said it has begun exploring strategic alternatives.

The solid gains in technology helped the S&P climb off its early lows, but the index was unable to close in the green. However, small caps outperformed as the Russell 2000 advanced 0.5%.

Treasuries were confined to a narrow range and the benchmark 10-yr yield slipped three basis points to 2.61%.

As mentioned earlier, participation was lacking as only 586 million shares changed hands on the floor of the New York Stock Exchange.

Today's economic data was limited to the July Treasury budget, which showed a deficit of $97.6 billion following a deficit of $69.6 billion in July 2012. Since the Treasury data are not seasonally adjusted, the data cannot be compared with the June level. The consensus expected the budget to show a deficit of $96 billion.

The Congressional Budget Office released their budget preview last week and predicted a shortfall of $96 billion. The market is well aware of the CBO's forecast and the reaction to the budget data is limited.

Tomorrow, July retail sales, export prices ex-agriculture, and import prices ex-oil will all be reported at 8:30 ET. The day's data will be topped off with the 10:00 ET release of June business inventories. 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.