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Leigh Baldwin & Co.

112 Albany Street, Cazenovia, NY 13035 | Phone: (315) 655-2964 Toll Free: 1-800-659-8044

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Day Traders Diary

12/1/14

The major averages began December on a lower note with relative weakness among cyclical sectors keeping the market under pressure throughout the day. The Nasdaq Composite (-1.3%) and Russell 2000 (-1.6%) paced the slide while the S&P 500 settled lower by 0.7% with eight sectors ending in the red.

Equities faced selling pressure from the opening bell after the overnight session reminded investors about persistent growth concerns around the globe. In Asia, China's HSBC Manufacturing PMI fell to an eight-month low (50.3; expected 50.5) while Japan's debt rating was lowered to A1 from Aa3 at Moody's. Making matters worse, Germany's Manufacturing PMI slid into contraction (49.5; expected 50.0) while the eurozone Manufacturing PMI narrowly avoided the same fate (50.1; expected 50.4).

Accordingly, the concerns about major economies kept cyclical sectors under pressure with five of six growth-sensitive groups ending behind the broader market. The industrial sector (-1.3%) slumped to the bottom of the leaderboard at the start and remained in that spot until the close. Transport stocks were largely responsible for the weakness with the Dow Jones Transportation Average ending lower by 2.7%.

Elsewhere among cyclical sectors, the top-weighted technology space (-1.1%) endured a late-morning plunge in the shares of Apple (AAPL 115.05, -3.88). The largest sector component was down as much 6.3% during the opening hour, but narrowed its loss to 3.3%. Chipmakers fared a bit better than Apple, but worse than the sector as evidenced by a 1.3% decline in the PHLX Semiconductor Index.

The energy sector (+0.8%) was the only cyclical group that finished ahead of the market thanks to a rebound in crude oil. The energy component rallied 4.1% to $69.02/bbl after marking an overnight low at $64.00/bbl. As for the energy sector, the group was underpinned by some of its main components like Chevron (CVX 111.73, +2.86) and ExxonMobil (XOM 92.35, +1.81). The two Dow components gained 2.6% and 2.0%, respectively, to help the price-weighted Dow (-0.3%) finish ahead of the broader market.

Over on the countercyclical side, the utilities sector (+0.2%) spent the bulk of the day in the green while other defensively-oriented sectors ended mixed. Health care (-0.2%) and consumer staples (-0.6%) settled ahead of the S&P 500 while the telecom services sector (-1.0%) lagged.

Treasuries notched their highs shortly after the opening bell and spent the remainder of the day in a steady retreat. The 10-yr yield climbed five basis points to 2.22%.

Today's participation was ahead of average with more than 850 million shares changing hands at the NYSE floor.

Economic data was limited to the ISM Index, which fell to 58.7 from 59.0 while the Briefing.com consensus expected a decline to 58.0. The Production Index fell to 64.4 from 64.8, which resulted from manufacturers delaying production until a later time. New orders improved as the related index increased to 66.0 from 65.8. Meanwhile, order backlogs increased to 55.0 from 53.0 in October.

Tomorrow, the Construction Spending report for October will be released at 10:00 ET (Briefing.com consensus 0.6%).

Nasdaq Composite +13.2% YTD
S&P 500 +11.1% YTD
Dow Jones Industrial Average +7.2% YTD
Russell 2000 -0.7% 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.