Day Traders Diary


The stock market ended the Tuesday affair on a modestly lower note as investors evaluated the latest batch of quarterly reports. Today's trade also featured a pullback in crude oil and increased volatility in the foreign exchange market. The Nasdaq Composite (-0.5%) settled behind the S&P 500 (-0.4%) and the Dow Jones Industrial Average (-0.3%).


The major averages inched lower at the start of the session, responding to mixed quarterly results from some market bellwethers. Dow components Procter & Gamble (PG 87.97, +2.87, +3.4%) and Merck (MRK 61.95, +1.20, +2.0%) finished at the top of the price-weighted average after reporting upbeat quarterly results. On the flipside, Dow members 3M (MMM 166.23, -5.04, -2.9%) and Caterpillar (CAT 84.48, -1.51, -1.8%) finished behind the index after cautious guidance stymied buying interest.


Equities extended their losses after the opening hour as some strengthening in the U.S. Dollar Index (98.73, -0.02, -0.02%) flashed warning signs to the broader market. The move higher came on the heels of some fleeting depreciation in the British pound. Sterling plunged 1.3% against the dollar (1.2083) ahead of commentary from Bank of England Governor Mark Carney. However, remarks from Governor Carney proved to be rather innocuous and the currency pair narrowed its loss throughout the remainder of the session. The pound lost 0.5% against the dollar (1.2183).


Crude oil was also unable to find its bearings today as the energy component extended its losing streak. Participants remained unsettled after Iraq indicated in the prior session that it may seek an exemption from the previously discussed OPEC supply freeze agreement. WTI crude ended its session lower by 1.3% ($49.87/bbl; -$0.65), extending its weekly loss to 1.9%. The American Petroleum Institute is scheduled to release its weekly inventory report after today's close while the Department of Energy will report its more influential inventory data tomorrow at 10:30 ET.


The broader market finished in the bottom of today's trading range as nine S&P 500 sectors ended in negative territory. Consumer discretionary (-1.2%), materials (-1.0%), telecom services (-0.6%), and technology (-0.4%) rounded out the leaderboard.


The consumer discretionary sector (-1.2%) bore the brunt of today's selling interest as the home retailer, apparel, and automobile sub-groups each moved lower following disappointing earnings and/or guidance. Lowe's (LOW 68.47, -2.51, -3.5%) and Home Depot (HD 123.34, -4.44, -3.5%) were under pressure after Sherwin-Williams (SHW 247.61, -30.27, -10.9%) missed quarterly earnings estimates and lowered its earnings outlook for the remainder of the year. Shares of Under Armour (UA 32.89, -5.01) tumbled 13.2% as below-consensus revenue guidance for the fourth quarter masked a bottom-line beat. Separately, General Motors (GM 31.60, -1.38) finished down 4.2% despite reporting a better-than-expected quarter.


In the technology sector (-0.5%), top-weighted Apple (AAPL 118.25, +0.60) finished higher by 0.5% ahead of its quarterly report. Meanwhile, Corning (GLW 22.97, -0.92) fell 3.9% despite reporting above-consensus quarterly results. The high-beta chipmakers finished slightly ahead of the broader sector as the PHLX Semiconductor Index slipped 0.2%.


The industrial group (-0.4%) settled in-line with the broader market as aerospace and defense names led. Lockheed Martin (LMT 249.26, +17.10, +7.4%) beat earnings estimates for the quarter and raised its full-year outlook. Separately, large caps Caterpillar (CAT 84.48, -1.51, -1.8%) and 3M (MMM 166.23, -5.04, -2.9%) each finished lower.


Treasuries finished on a mixed note with the short end of the curve underperforming. The yield on the 2-yr note rose two basis points to 0.86% while the yield on the benchmark 10-yr note ended down one basis point at 1.76%.


Today's trading volume was below the average of 853 million as 819 million shares changed hands at the NYSE floor.


Today's economic data included the Case-Shiller 20-city Index for August, the FHFA Housing Price Index for August, and Consumer Confidence for October:


The FHFA Housing Price Index for August rose 0.7%, which followed an increase of 0.5% in July.

The Case-Shiller 20-city Home Price Index for August rose 5.1%, which fell in-line with the consensus. This followed the previous month's unrevised reading of 5.0%.

The Conference Board's Consumer Confidence Index fell to 98.6 in October from a downwardly revised 103.5 (from 104.1) in September. The downturn in October followed back-to-back monthly gains in the Index.

For more on these economic releases, be sure to visit's Economic Calendar page.


Tomorrow's economic data will include the weekly MBA Mortgage Index and International Trade in Goods for September, which will be released at 7:00 ET and 8:30 ET, respectively. The day's data will be capped off with the 10:00 ET release of New Home Sales for September ( consensus 610k).


Russell 2000: +7.0% YTD

Nasdaq Composite: +5.5% YTD

S&P 500: +4.9% YTD

Dow Jones: +4.3% YTD


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