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Leigh Baldwin & Co.

112 Albany Street, Cazenovia, NY 13035 | Phone: (315) 655-2964 Toll Free: 1-800-659-8044

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Day Traders Diary

3/26/19

The S&P 500 gained 0.7% on Tuesday, as an early uptick in U.S. Treasury yields and gains in most global equity markets helped foster some risk-on sentiment. It wasn't easy, though, as the benchmark index declined from a gain of 1.1% at its high to a gain of 0.2% at its low before rallying in the last 30 minutes of action.

The Dow Jones Industrial Average gained 0.6%, the Nasdaq Composite gained 0.7%, and the Russell 2000 gained 1.0%. 

All 11 S&P 500 sectors finished higher with gains ranging from 0.4% (consumer discretionary) to 1.5% (energy). Many energy stocks benefited from an increase in oil prices ($59.94/bbl, +$1.05, +1.8%).

Stocks jumped out of the gate as investors rallied to buy the recent dip in equities while bond yields edged up from this year's lows. The 2-yr yield and the 10-yr yield had been up as much as four basis points each from their unchanged marks, but spent most of intraday action in a steady retreat. The pullback in yields coincided with the pullback in equities.

The 2-yr yield closed one basis point higher at 2.26%, while the 10-yr yield declined one basis point to 2.41%. The U.S. Dollar Index increased 0.2% to 96.80.

Shares of Apple (AAPL 186.79, -1.95, -1.0%) were up as much as 2.2% but steadily declined throughout the day. The stock took a leg lower into negative territory after Bloomberg reported a U.S. trade judge recommended a ban on imports of some iPhone models due to Apple's infringement on a Qualcomm (QCOM 58.00, +1.36, +2.4%) patent. The judge's findings will be subject to a full review by the U.S. International Trade Commission. 

Bed Bath & Beyond (BBBY 16.92, +3.05) was another story stock, surging 22.0%, after The Wall Street Journal reported that activist investors are preparing to launch a proxy fight to replace its entire 12-person board. Disappointing guidance from Carnival (CCL 51.71, -4.94), meanwhile, sent the stock lower by 8.7%.

In M&A news, Uber Technologies (UBER) announced it will acquire Middle East rival Careem Networks for $3.1 billion, consisting of $1.7 billion in convertible notes and $1.4 billion in cash. Uber plans to kick off its IPO next month.

Reviewing Tuesday's batch of economic data, which included Housing Starts and Building Permits for February, the Conference Board's Consumer Confidence Index for March, the FHFA Housing Price Index for January, and the S&P Case-Shiller Home Price Index for January:

  • Housing Starts decreased 8.7% m/m in February to a seasonally adjusted annual rate of 1.162 million units (Briefing.com consensus 1.210 million) from an upwardly revised 1.273 million (from 1.230 million) in January. Building permits decreased 1.6% m/m to 1.296 million (Briefing.com consensus 1.308 million) from a downwardly revised 1.317 million (from 1.345 million) in January.
    • The key takeaway from the report is that the yr/yr rate of decline accelerated, with starts now down 9.9% yr/yr while permits are down 2.0% yr/yr.
  • The Conference Board's Consumer Confidence Index decreased to 124.1 in March (Briefing.com consensus 132.0) from an unrevised 131.4 in February. The March decline represents the fifth decrease over the past six months.
    • The key takeaway from the report is that while consumers remain confident in the economy's ability to expand, the level of expectations has moderated.
  • The FHFA Housing Price Index for January increased 0.6% (Briefing.com consensus 0.3%), up from an unrevised December reading of 0.3%.
  • The Case-Shiller Home Price Index for January increased 3.6%, down from a revised reading of 4.1% in December (from 4.2%).

Looking ahead, investors will receive the weekly MBA Mortgage Applications Index, the Trade Balance Report for January, and the Current Account Balance for the fourth quarter on Wednesday.

  • Nasdaq Composite +15.9% YTD
  • Russell 2000 +13.3% YTD
  • S&P 500 +12.4% YTD
  • Dow Jones Industrial Average +10.0% YTD
 

 

 

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