Day Traders Diary

5/10/22

The major averages seesawed Tuesday with the Dow slipping for a fourth day as the major averages struggled to bounce back from a bout of heavy selling. The Dow Jones Industrial Average dipped 84 points to 32,16, or 0.26%. The S&P 500 inched up 9 points or 0.25% back above 4,001 while the Nasdaq Composite gained 114 points or 0.98% to close at 11,737.

The market struggled to choose a direction on Tuesday in an erratic trading session that saw the major averages waver between gains and losses. At one point, the Dow rose more than 500 points but later stooped to a session low of roughly 350 points.

Beaten-up technology stocks like Microsoft, Intel, Salesforce and Apple led Tuesday's gains, rising about 2% each. The sector has suffered some of the biggest losses in recent weeks as investors moved out of growth areas and into safe havens like consumer staples and utilities amid recessionary fears.

Meanwhile, IBM slipped 4% and Home Depot, 3M and JPMorgan Chase each slid about 2%, dragging the Dow Industrial Average into the red.

Amid the sell-off, investors continued to look for signs of a bottom.

Some, including hedge-fund manager David Tepper, think the sell-off is nearing an end. Tepper told CNBC's Jim Cramer on Tuesday that he expects the Nasdaq to hold at the 12,000 level.

Treasury yields eased from multiyear highs and the benchmark 10-year Treasury note yield traded below 3% after hitting its highest level since late 2018 on Monday.

Much of the recent market moves have been driven by the Federal Reserve and how aggressively it will act to curb rising inflation. Alongside, investors continued to monitor the ongoing conflict in Ukraine and lockdowns in China.

Tuesday's moves came after the S&P 500 dropped below the 4,000 level to a low of 3,975.48 on Monday. It marked the index's weakest point since March 2021. The broad market index dropped 17% from its 52-week high as Wall Street struggled to recover from last week's losses.

On the earnings front, Peloton Interactive plummeted 8.7% after reporting a wider-than-expected loss in the recent quarter. AMC's stock dropped 5.4% on the back of recent quarterly earnings.

Investors are looking ahead to April CPI data on Wednesday which is expected to come in slightly below March's 8.5% and could signal that inflation has reached a peak.

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