Day Traders Diary


Not much stood in the way of the major averages on Thursday as they continued their year-end rally. The Dow Jones Industrial Average (+0.8%) logged its sixth consecutive gain while the S&P 500 (+0.5%) posted its fourth advance in a row. However, both ended the session at fresh record highs.
Despite the steady, day-long rally in the Dow and S&P, the Nasdaq (+0.3%) spent the entire session inside of a ten-point range, and settled essentially where it started the day.
The tech-heavy Nasdaq saw its rally attempts short-circuited by its top component, Apple (AAPL 563.90, -3.77), which fell 0.7%. Meanwhile, the S&P technology sector inched higher throughout the day and settled with a modest gain of 0.3%.
Outside of technology, the financial sector (+0.2%) was the only cyclical group that could not keep pace with the broader market. The remaining four cyclical sectorsconsumer discretionary (+0.6%), energy (+0.9%), industrials (+0.7%), and materials (+0.6%)all finished ahead of the S&P.
Of those four outperformers, energy and industrials provided leadership from the opening bell. The energy sector maintained its relative strength into the close while crude oil was limited to an increase of 0.4% (to $99.59/bbl). Top-weighted components, Chevron (CVX 124.81, +1.30) and ExxonMobil (XOM 100.90, +1.68) underpinned the growth-sensitive sector and their strength also factored into the outperformance of the Dow.
The price-weighted Dow also drew strength from 3M (MMM 138.29, +1.30) and Boeing (BA 138.27, +1.44), both of which helped the industrial sector (+0.7%) end not far behind energy.
Over on the countercyclical side, the third-largest S&P sector, health care (+0.7%), outperformed while consumer staples (+0.4%) and utilities (-0.4%) lagged. For its part, the telecom services sector (+0.5%) finished in-line with the broader market.
In part, the underperformance of utilities was rooted in the continued rise in yields. The 10-yr note slipped as its yield tested 3.000% before settling at 2.990%. Since the tapering announcement, the benchmark yield has added almost 11 basis points.
Participation was well, well, well-below average as only 410 million shares (versus an average of 726 million) changed hands on the floor of the New York Stock Exchange. Did we mention that today's participation was on the light side?
Although the broader market did not see much volume, Twitter (TWTR 73.21, +3.35) maintained its torrid pace on heaviest volume (82.5 million) since its market debut. The stock surged 4.8%, extending its December gain to 76.4%.
Today's economic data was limited to weekly initial claims, which dropped to 338,000 from an upwardly revised rate of 380,000 (from 379,000) while the consensus expected a decline to 350,000. Seasonal adjustment issues have been a recurring theme in claims data for the past few months, and the trend continued in today's report.
There is no economic data of note on tomorrow's schedule.

Nasdaq +38.0% YTD
Russell 2000 +36.9% YTD
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