Day Traders Diary


The S&P 500 snapped a five-day win streak on Tuesday as the U.S. market reacted to rekindled growth concerns out of China. Meanwhile, a tumble in oil prices, consolidation after the recent leg higher in the major averages, and the underperformance of the heavyweight financial sector (-1.7%) also contributed to today's decline. The Nasdaq Composite (-1.3%) settled behind both the S&P 500 (-1.1%) and the Dow Jones Industrial Average (-0.6%).


Equity indices started their day beneath their flat lines as a weaker-than-expected reading of China's February trade data weighed on the market. The report showed that exports fell 25.4% (consensus -12.5%; last -11.2%) while imports declined 13.8% (expected -10.0%; previous -18.8%). The headline figure showed that the country's trade surplus came in at $32.59 billion (expected $50.15 billion) against the previous month's reading of $63.29 billion.


Stocks climbed off their lows for the bulk of the trading day, but the rally in equities lost steam shortly after the Nasdaq 100 flashed a brief gain. After crude oil's pit session ended, the averages tumbled back towards their lows, reaching their lowest point in the last half hour of trade.


The energy sector (-4.1%) rounded out the leaderboard as a plunge in crude oil weighed on the sector. WTI crude ended its day lower by 3.8% at $36.48/bbl. Meanwhile, the broader energy sector trimmed its March advance to 5.3% as independent oil and gas names demonstrated relative weakness. To that point, Anadarko Petroleum (APC 41.14, -3.96) plummeted 8.8%, but still remains up 5.1% in the month of March.


The materials space (-2.0%) followed energy on the leaderboard as the sector pulled back from its 3.0% gain so far in March. Meanwhile the heavyweight financial sector (-1.7%) followed the pair in the back of the pack.


In the economically-sensitive financial sector, money center banks demonstrated relative weakness while Goldman Sachs (GS 151.60, -3.75) was the second worst performer in the Dow Jones. Life insurance companies underperformed today as MetLife (MET 41.78, -1.07) and Prudential (PRU 70.32, -1.81) fell 2.5% apiece. The two names have climbed a respective 4.5% and 4.6% in March, compared to the 3.8% advance in the broader sector.


The heavily-weighted technology (-0.8%) and consumer discretionary (-0.8%) spaces outperformed throughout today's session as large cap names continued to garner buying interest. Facebook (FB 105.93, +0.20) and Alphabet (GOOGL 713.53, +0.73) managed to recover from early weakness while Nike (NKE 59.81, +0.56) rebounded from yesterday's 3.3% decline.


Biotechnology weighed on the health care sector (-1.3%) as the iShares Nasdaq Biotechnology ETF (IBB 260.13, -9.63) surrendered 3.6%. The sub-group continues to show relative weakness with the ETF surrendering 21.5% since the beginning of 2016 while the broader sector has declined 7.1%.


Utilities (+0.8%), consumer staples (+0.3%), and telecom services (UNCH) were the only three sectors able to end the day in positive territory, as the groups benefited from an early and sustained safe haven bid.


The U.S. Dollar Index (97.19, +0.12) ended its day in positive territory as the euro returned its gain against the greenback while the yen trimmed its advance. The euro/dollar pair slipped 0.1% (1.1007) after falling from a session high of 1.1056. Meanwhile, the dollar/yen pair fell 0.7% to 112.64 after trading as low as 112.44.


The Treasury complex climbed higher to begin the session, but backed away from its high. The yield on the 10-yr note ended lower by eight basis points at 1.82%.


Today's participation was true to the recent average as more than 1.08 billion shares changed hands at the New York Stock Exchange floor.


There was no economic data of note released today.


Tomorrow's economic data will include the weekly MBA Mortgage Index and the January Wholesale Inventories Report ( consensus -0.2%), which will cross the wires at 7:00 ET and 10:00 ET, respectively.


Nasdaq -7.2% YTD

Russell 2000 -6.0% YTD

S&P 500 -3.2% YTD

Dow Jones -2.7% YTD

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