Day Traders Diary



The stock market ended the Wednesday affair on a higher note as the major averages rallied in lockstep with crude oil throughout today's session. Other factors that contributed to today's advance included persistent leadership from the heavily-weighted health care (+2.7%) sector and the FOMC minutes from the March meeting that fell largely in-line with expectations. The Nasdaq Composite (+1.6%) ended its day ahead of both the S&P 500 (+1.1%) and the Dow Jones Industrial Average (+0.6%).

The broader market was able to shake some early risk-off tendencies as investors weighed a rally in crude against the imminent release of the minutes from the FOMC's latest meeting. The energy component extended an early rally following the Department of Energy's weekly inventory report. The report showed that crude oil stockpiles had decreased by 4.93 million barrels, compared to the estimated 3.15 million barrel build. As a result, WTI crude ended its day higher by 5.0% at $37.74/bbl.

On the central bank front, the minutes from the March FOMC meeting indicated that an April rate hike was discussed at the meeting, but ongoing concerns regarding global economic and financial developments warranted a more cautious approach. Meanwhile, the committee produced diverging opinions on whether the recent uptick in inflation was transitory or if it represented a firming trend.

The heavily-weighted health care space (+2.7%) ended its day ahead of commodity-sensitive energy (+2.1%) and the consumer discretionary (+0.9%) sector while countercyclical telecom services (-1.0%) and utilities (-0.1%) were the only two sectors to end beneath their flat lines.

In the heavyweight health care group (+2.7%), biotechnology outperformed as it rebounded from larger year to date losses. The iShares Nasdaq Biotechnology ETF (IBB 285.71, +16.07) ended its day higher by 6.0%. The beleaguered sub-group traded higher with Valeant Pharmaceuticals (VRX 34.17, +5.44). Valeant gained 18.9% after Pershing Square contended that Valeant's assets are not fairly reflected in its stock price. Separately, Allergan (AGN 244.74, +8.19) rebounded 3.5% after yesterday's tumble that followed new policies regarding corporate inversions.

Commodity-sensitive energy (+2.1%) displayed broad based strength, as the sector was the main beneficiary of today's rally in oil. Pipeline companies and independent oil and gas names finished with some of the largest gains in the sector. Conversely, refiners underperformed in the space after gasoline inventories showed a build instead of an expected draw. On that note, Valero Energy (VLO 61.68, -1.46) declined 2.3%. 

In the consumer discretionary space (+0.9%), Amazon (AMZN 302.08, +15.94) gained 2.7% after the online retailer announced a new e-reader. On the flipside, the lodging and leisure sub-groups underperformed after Wynn Resorts (WYNN 89.55, -1.37) preannounced revenue results that disappointed investors.

Rail names underperformed in the industrial (+0.2%) group as CSX (CSX 24.85, -0.19), Union Pacific (UNP 78.35, -0.27), and Kansas City Southern (KSU 85.88, -0.70) ended with losses between 0.3% and 0.8%. Elsewhere, machinery companies underperformed following Cummins (CMI 106.43, -1.59) being downgraded to "Neutral" at Buckingham Research.  

The U.S. Dollar Index (94.49, -0.25) surrendered its overnight gains as the greenback ended lower against the yen and the euro. The euro gained 0.1% against the dollar and finished at 1.1399. Separately, the dollar/yen pair lost 0.5% (109.77).

The Treasury Complex ended its day off its low as the yield on the 10-yr note rose three basis points to 1.75%.

Today's participation fell in-line with the recent average as more than 844 million shares changed hands on the NYSE floor.

Today's economic data included the weekly MBA Mortgage Index:

  • The weekly MBA Mortgage Index showed a seasonally adjusted increase of 2.7%.

Tomorrow's economic data will be limited to weekly initial claims ( consensus 270k) and Consumer Credit for February ( consensus $14.40 billion), which will be released at 8:30 ET and 15:00 ET, respectively. 

  • Russell 2000 -2.4% YTD
  • Nasdaq Composite -1.7% YTD
  • S&P 500 +1.1% YTD
  • Dow Jones +1.7% YTD

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