Day Traders Diary
Equities advanced for a third consecutive session on Thursday, with energy and materials shares leading a broad-based rally.
The benchmark S&P 500 jumped 0.7% to 2662.84, trimming its yearly loss to 0.4%, while the Nasdaq Composite climbed 0.5% to 7076.55, and the Dow Jones Industrial Average rallied 1.0% to 24505.22. The S&P 500 and the Dow never touched negative territory -- the Nasdaq did briefly -- and all three major averages finished in the upper half of their trading ranges. Action was somewhat volatile -- although not as volatile as other sessions this week -- but the CBOE Volatility Index slipped 1.43 points, or 7.1%, to 18.63 -- a two-week low.
10 of 11 S&P sectors finished in positive territory, with growth-sensitive groups like consumer discretionary (+1.4%), industrials (+1.0%), energy (+1.8%), and materials (+1.9%) leading the charge. The top-weighted technology sector couldn't keep pace, however, which was somewhat discouraging, but the group still finished with a gain of 0.4%.
Within the tech space, Facebook (FB 159.34, +4.24) outperformed, adding 2.7%, after CEO Mark Zuckerberg said he doesn't think the #deletefacebook movement has had a material impact. Chipmakers lagged, however, pushing the PHLX Semiconductor Index lower by 1.0%. NVIDIA (NVDA 221.38, -4.86) lost 2.2% following some cautious commentary out of Citron Research, and Micron (MU 49.84, -3.55) tumbled 6.7% after a director disclosed that she sold 25,000 shares on April 2. UBS initiated a 'Sell' rating following the disclosure.
Meanwhile, the heavily-weighted health care sector finished at the bottom of the sector standings, shedding 0.1%, as biotechnology names underperformed -- evidenced by the 1.6% decline in the iShares Nasdaq Biotechnology ETF (IBB 104.17, -1.72). Biogen (BIIB 264.98, -7.42) was particularly weak, losing 2.7%, after being downgraded to 'Equal Weight' from 'Overweight' at Barclays.
Despite the pockets of weakness, the broader market was strong through most of Thursday's session. A Bloomberg TV interview with Atlanta Fed President Raphael Bostic contributed to the positive bias, as Mr. Bostic, who is a voting member on this year's FOMC, said he's comfortable with inflation going above the Fed's 2.0% target -- which suggests that he may favor a less aggressive approach to hiking interest rates. However, with the March Employment Situation Report due Friday, investors fought the urge to tamper with their rate-hike expectations.
U.S. Treasuries largely kept overnight losses intact on Thursday, extending them just slightly during intraday trade. The yield on the benchmark 10-yr Treasury note advanced four basis points to 2.83%, closing at its highest level in more than a week, while the 2-yr yield ticked up two basis points to 2.30%.
Reviewing Thursday's economic data, which was limited to the Trade Balance for February and weekly Initial Claims:
On Friday, investors will receive the Employment Situation Report for March, which the Briefing.com consensus expects will show the addition of 175,000 nonfarm payrolls, an increase of 0.2% in average hourly earnings, and an unemployment rate of 4.0%. The report, which has the potential to move the financial markets, will be released at 8:30 AM ET. The much less influential Consumer Credit Report for February (Briefing.com consensus $15.0 billion) will be released in the afternoon at 3:00 PM ET.
Headlines provided by briefing.com