Day Traders Diary

12/17/21

The major averages sold off on Friday in a volatile session amid worries about tighter monetary policy and the rising number of the Omicron variant. The Dow Jones Industrial Average dropped 532 points, or 1.5%, to 35,366. The S&P 500 fell 48 points or 1% for a second down day to 4,620. The tech-heavy Nasdaq Composite ended the session down just 10 points to 15,169 after briefly trading in the green. At its session low, the Nasdaq dropped 1.5%.

The major averages posted a negative week with the Nasdaq being the biggest loser. The tech-heavy benchmark declined 3%, while the Dow and the S&P 500 slipped 1.7% and 1.9%, respectively.

Friday coincided with the expiration of stock options, index options, stock futures and index futures — a quarterly event known as "quadruple witching" that typically comes with heightened volatility.

The S&P financial sector was the biggest laggard on Friday after bank stocks outperformed in the previous session. Goldman Sachs lost nearly 4%, while Bank of America and JPMorgan both traded over 2% lower.

Many megacap tech shares traded in the red. Amazon and Microsoft both lost about 1%, while Alphabet and Meta Platforms also dipped 1% each. Microsoft has lose more than 6% this week alone, and Apple is down 5% on the week.

Shares of one-time EV darling Rivian tumbled 11% Friday after the truck maker said it will fall short of its 2021 production target.

Investors appeared to be rotating from high-growth tech names to consumer staples, as they continued to digest the latest move by the Federal Reserve along with rising inflation and the spread of the omicron Covid variant.

FedEx shares jumped 5% after quarterly earnings and revenue results topped expectations and it announced a $5 billion buyback. The shipper also reinstated its original 2022 EPS forecast.

Covid-19 vaccine makers Moderna and Pfizer are on track to be the biggest gainers in the S&P 500 this week, with weekly returns of 14% and 13% so far, respectively.

Earlier this week, the Fed announced a more aggressive plan to wind down its asset purchases, and that it is looking at hiking rates multiple times in 2022.

All comments contained herein are for informational purposes only, and should not be considered as a solicitation to buy or sell any security. The firm does not guarantee the accuracy or completeness of the information or make any warranties regarding results from it's usage.