Day Traders Diary


The stock market followed the script on Friday of making a big statement by doing very little. The major indices held to tight trading ranges and didn't venture that far from where they began the session.

The market's meandering disposition was a function of offsetting considerations that it is due for a pullback after its big run, yet in the midst of a typically favorable period that is causing some angst about the possibility of missing out on further gains.

Accordingly, it was a bit of a chopfest as far as Friday's trading action was concerned, but true to recent form, a closing burst of buying interest materialized that helped the S&P 500 eke out a positive finish.

The energy (+0.8%), technology (+0.6%), and consumer discretionary (+0.4%) sectors were the heavily-weighted sectors showing gains while the health care (-0.8%), consumer staples (-0.6%), and financial (-0.4%) sectors were the heavily-weighted sectors showing offsetting losses. The industrials sector finished up fractionally, the telecom services sector added 0.6%, the materials sector advanced 0.3%, and the utilities sector dipped 0.4%.

Much of the more scintillating trading action took place away from the stock market. To that end, the Treasury market experienced a seesaw day that featured early weakness and later strength. The yield on the 10-yr note swung from a high of 2.38% to a low of 2.32%, where it settled its technically-driven session.

The commodities arena was a focal point throughout the day, primarily because oil prices bounced back to the doorstep of $76.00/bbl ($75.98) after dropping below $73.50 in overnight action. The turnaround was helped along presumably by some short-covering activity, yet it proved instrumental in driving the outperformance of the energy sector. On a related note, it was reported that the House of Representatives passed a bill allowing for the construction of the Keystone XL oil pipeline.

The metals, in turn, saw some big gains with gold jumping 2.5% to $1191.00/troy ounce, silver popping 4.5% to $16.33/troy ounce, and copper gaining 1.8% to $3.05/lbs.

Those recovery efforts helped underpin the S&P 500 materials sector, which also benefited from better-than-feared GDP data out of the eurozone, a 0.3% increase in retail sales in the U.S. in October, and the highest reading for consumer sentiment in November (89.4), as measured by the University of Michigan, since July 2007.

Within the stock market, the health care sector was the worst-performing area on Friday thanks in large part to profit-taking efforts in the biotech stocks. Celgene (CELG 104.01, -3.42), Biogen-Idec (BIIB 305.43, -12.55), and Amgen (AMGN 157.68, -3.17) all declined between 2.0% and 4.0%.

There wasn't a single sector, though, that finished up or down at least 1.0%, which fit the template of being a mixed day of trading. Similarly, 16 of the Dow's components ended higher while 14 ended lower. IBM (IBM 164.16, +1.37) led the winners while Visa (V 248.84, -2.08) paced the decliners.

Elsewhere, the Russell 2000 finished down 0.1% while the S&P Midcap 400 Index suffered a fractional loss.

DJIA +6.4% YTD
Nasdaq Composite +12.3% YTD
S&P 500 +10.4% YTD
Russell 2000 +0.8% YTD

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