Day Traders Diary



Wall Street soared on Thursday, with the Dow Jones Industrial Average adding 1.0% and finishing at a new all-time high for the first time since January 26. With trade war fears still lingering and no fundamental catalyst to drive the market higher, stocks relied on momentum and the fear of missing out to log Thursday's gains.

As for the other major averages, the S&P 500 also closed at a new record, finishing with a gain of 0.8%; the tech-heavy Nasdaq Composite advanced 1.0% to finish about 1.0% off its August 29 record; and the small-cap Russell 2000 climbed 1.0%, coming within 1.2% of its all-time high.

The top-weighted information technology sector rebounded on Thursday after a slow start to the week, finishing atop the sector standings with a gain of 1.2%. However, within the space, software company Red Hat (RHT 133.81, -9.35) tumbled 6.5% after disappointing Q3 guidance overshadowed above-consensus earnings.

In total, 10 of 11 sectors finished in the green. After tech, the materials (+1.1%), consumer staples (+1.2%), and health care (+0.9%) sectors were the next-best performers. The influential financial sector (+0.8%) was also strong, even though yields fell from multi-month highs. The benchmark 10-yr yield, for instance, slipped one basis point to 3.08% after hitting a four-month high on Wednesday.

Conversely, the oil-sensitive energy sector finished with a loss of 0.1%. A decline in the price of crude oil weighed on energy shares after President Trump criticized OPEC on Thursday morning, saying the "OPEC monopoly must get [oil] prices down now!" WTI crude futures lost 0.6%, closing at $70.26/bbl.

In corporate news, Amazon (AMZN 1944.30, +17.88) introduced 15 Alexa-enabled products at an event in Seattle, including a microwave, as the company looks to strengthen its position in the voice assistant space. Shares of Amazon finished the day higher by 0.9%.

On the currency front, the U.S. Dollar Index fell for the fourth day in a row, tumbling 0.7% to 93.46; that marks its lowest level since early June.

Reviewing Thursday's economic data, which included Existing Home Sales for August, the weekly Initial Claims report, the Philadelphia Fed Index for September, and the Conference Board's Leading Economic Index for August:

  • Existing home sales stayed at an annualized rate of 5.34 million units ( consensus 5.37 million) in August. The July reading was left unrevised at 5.34 million.
    • The key takeaway from the report is that inventory is stabilizing, implying that there could be some moderation in the pace of price increases that could help drive increased buying interest (and perhaps added listing interest).
  • The latest weekly initial jobless claims count totaled 201,000, while the consensus expected a reading of 209,000. Today's tally was below the unrevised prior week count of 204,000. As for continuing claims, they declined to 1.645 million from a revised count of 1.700 million (from 1.696 million).
    • The key takeaway from the report is that it reflects a reluctance on the part of employers to reduce staff, which goes hand-in-hand with a strong economy and tight labor market.
  • The Philadelphia Fed Survey for September rose to 22.9 ( consensus 15.3) from an unrevised 11.9 in August.
    • A number above zero is indicative of growth, so the key takeaway from the report is that it reflects the idea that manufacturing activity in the Philadelphia Fed region accelerated in September.
  • The Conference Board's Leading Economic Index increased 0.4% in August ( consensus +0.5%), and the July reading was revised to +0.7% from +0.6%.
    • The key takeaway from the report is that strength among the leading indicators remained widespread, which points to a sustained pace of economic expansion.

Investors will not receive any notable economic data on Friday.

  • Nasdaq Composite +16.3% YTD
  • Russell 2000 +12.0% YTD
  • S&P 500 +9.6% YTD
  • Dow Jones Industrial Average +7.8% YTD



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