Day Traders Diary



The equity market kicked off the week with a quiet victory on Monday, adding to last week's advance. The tech-heavy Nasdaq climbed 0.7% to 7606.46, closing at a new record high for the first time since March 12. Meanwhile, the S&P 500 and the Dow advanced 0.5% and 0.7%, respectively. The Russell 2000 lagged, adding just 0.3%, but still finished at a new all-time high.

Gains were broad-based on Monday, with seven of eleven S&P 500 sectors settling in positive territory. Consumer discretionary (+1.1%) was the top-performing sector, followed closely by information technology (+0.9%), consumer staples (+0.8%), and real estate (+1.0%).

Within the tech space, Apple (AAPL 191.83, +1.59) climbed 0.8%, closing at a new all-time high, as investors focused on the company's WorldWide Developers Conference (WWDC), and Microsoft (MSFT 101.67, +0.88) advanced 0.9%, also settling at a new record, after announcing that it will acquire GitHub for $7.5 billion in stock.

Meanwhile, retailers helped underpin the consumer discretionary and consumer staples sectors and pushed the SPDR S&P Retail ETF (XRT 47.64, +1.02) up 2.2% to a fresh four-month high. Walmart (WMT 85.42, +2.43), Home Depot (HD 191.36, +4.01), and Target (TGT 76.35, +3.55) were notable outperformers, adding between 2.1% and 4.9%.

On the downside, energy (-0.9%) finished at the bottom of the sector standings as crude prices dropped yet again. WTI crude futures declined by 1.6% to $64.76 per barrel, finishing 10.4% below the three-and-a-half year high they hit on May 21. The utilities (-0.9%), industrials (-0.1%), and telecom (-0.1%) groups also settled in the red.

In the health care space (+0.4%), Nektar Therapeutics (NKTR 52.57, -37.78) plunged 41.8% following disappointing clinical trial results for its drug NKTR-214, which is being used in combination with Bristol-Myers Squibb's (BMY 51.45, -1.68) cancer drug Opdivo. Conversely, Dow component Merck (MRK 62.02, +1.46) jumped 2.4% after another round of positive trial results for its star cancer drug Keytruda.

Outside of equities, U.S. Treasuries began the week on a lower note, sending yields higher across the curve. The yield on the benchmark 10-yr Treasury note, for instance, climbed four basis points to 2.94%. Meanwhile, the U.S. Dollar Index declined 0.2% to 94.02, marking its third loss in four sessions.

Reviewing Monday's economic data, which was limited to the Factory Orders report for April:

  • The Factory Orders report for April showed a decrease of 0.8% ( consensus -0.5%). The March reading was revised to +1.7% from +1.6%.
    • The key takeaway from the report is that shipments of nondefense capital goods excluding aircraft were slightly higher than what was seen in the Advance Durable Goods Orders Report for April, so this will provide an added dose of support for Q2 GDP growth forecasts.

Looking ahead, investors will receive the ISM Services Index for May and the Job Openings and Labor Turnover Survey for April on Tuesday.

  • Nasdaq Composite +10.2% YTD
  • Russell 2000 +7.7% YTD
  • S&P 500 +2.7% YTD
  • Dow Jones Industrial Average +0.4% YTD

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