Day Traders Diary
9/9/14The major averages ended the Tuesday session on their lows with the S&P 500 sliding 0.7%. Small-cap stocks outperformed yesterday, but the Russell 2000 erased Monday's uptick with a 1.2% decline.
Equity indices spent the entire session in the red with the early pressure coming from the financial sector (-1.0%). The second-largest group by market cap slumped out of the gate amid broad weakness in top-weighted components. Bank of America (BAC 16.14, -0.21), Citigroup (C 51.27, -0.78), and JPMorgan Chase (JPM 59.06, -0.83) lost between 1.3% and 1.5%, while the sector acted as a drag on the market throughout the session.
Meanwhile, the consumer discretionary space (-1.0%) also weighed with the SPDR S&P Retail ETF (XRT 88.06, -0.86) falling 1.0%. The quick-service restaurant space did not fare much better as McDonald's (MCD 91.09, -1.41) fell 1.5% after reporting a 3.7% decline in comparable store sales during August. The decline was paced by a 14.5% slump in Asia following the recent food safety scandal.
Elsewhere, the top-weighted sectortechnology (-0.6%)endured a choppy session before settling on its low. Shares of Apple (AAPL 97.99, -0.37) were responsible for the volatile action, with the stock surging on the announcement that near field communication capabilities will be included in the upcoming version of the iPhone. Despite the spike, Apple slumped from highs to lows after revealing the long-rumored "Apple Watch," which will be available next year.
Combined with the underperformance of the aforementioned sectors, the afternoon retreat in Apple pressured the market to fresh lows.
Despite the weakness in three top-weighted sectors, another influential grouphealth care (-0.3%)kept the market from extending its loss. Insurers and managed care names outperformed, while biotechnology slumped. Tenet Healthcare (THC 60.97, +1.98) jumped 3.4% after Deutsche Bank added the stock to its short-term buy list, while the iShares Nasdaq Biotechnology ETF (IBB 269.60, -3.46) fell 1.3%.
Similar to health care, the consumer staples sector (-0.3%) outperformed, while telecom services (-1.2%) and utilities (-1.2%) lagged.
Economic data was limited to the Job Openings and Labor Turnover Survey for July, which indicated job opening decreased to 4.673 million from 4.675 million.
Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET, while the Wholesale Inventories report for July (Briefing.com consensus 0.5%) will cross the wires at 10:00 ET.
Nasdaq Composite +9.0% YTD
S&P 500 +7.6% YTD
Dow Jones Industrial Average +2.6% YTD
Russell 2000 -0.4% YTD 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.