Day Traders Diary

2/18/21

The major averages finished in the red as investors were discouraged by a worse-than-expected jobless claims reading as well as a weak forecast from Walmart. The Dow Jones Industrial Average fell 119 points, or 0.4%, to 31,493, slipping from a record high. At its session low, the 30-stock benchmark was down more than 300 points. The S&P 500 dipped 0.4% to 3,913, falling for a third straight day. The Nasdaq Composite slipped 0.7% to 13,865 as investors continued to rotate out of high-flying tech.

Walmart shares dropped 6.5% after its fourth-quarter earnings fell short of Wall Street estimates. The big-box retailer sees sales growth slowing this year as the pandemic momentum ebbs. It said earnings per share will decline, but will range flat to slightly higher after excluding divestitures.

Shares of Apple fell another 0.9%. The tech giant is down 4.2% so far this week as investors take some profits in the Big Tech stocks that have led the market back to a record. Tesla dipped 1.4%, bringing its week-to-date losses to 3.5%.

Meanwhile, the latest jobless claims number signaled a setback in the labor market recovery. First-time filings for unemployment insurance totaled 861,000 last week, the highest level in a month and above the Dow Jones estimate of 773,000, the Labor Department reported Thursday.

The recent jump in bond yields coupled with rising inflation expectations made some investors worried about a pullback for stocks in the near term. High-growth technology companies, which led the market's epic comeback, are especially vulnerable to higher interest rates and inflation pressures.

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