"Today's news was certainly dominated by earnings reports, with Apple (NASDAQ:AAPL) and Netflix (NASDAQ:NFLX) grabbing the biggest headlines," noted Schaeffer's Senior Equity Analyst Joe Bell. The former's worse-than-expected announcement "dragged down the tech-heavy Nasdaq Composite (COMP)," Bell said, "causing it to underperform on the day." Meanwhile, the Dow Jones Industrial Average (DJI) pressed higher for the fifth consecutive session and registered another new multi-year peak in late-morning action.
Continue reading for more on today's market, including:
The Dow Jones Industrial Average (DJI) made it five in a row, advancing 46 points on the day, or 0.3%, but closing almost 55 points from its intraday high of 13,879.66. Roughly two-thirds of the 30 Dow names closed higher, led by Cisco Systems (NASDAQ:CSCO), which advanced 1.9%. While Hewlett-Packard (NYSE:HPQ) and Walt Disney (NYSE:DIS) finished unchanged, Alcoa (NYSE:AA) was the Dow's worst performer, losing 1.2%.
The S&P 500 Index (SPX) overtook the 1,500 mark and notched a new multi-year high on an intraday basis, but this round-number level wasn't going down without a fight. The index closed with fractional gains, up 0.01 point. The Nasdaq Composite (COMP) lagged its index peers as AAPL-tinged reverberations were felt throughout the technology sector. At the close, the COMP was down 23 points, or 0.7%.
The CBOE Market Volatility Index (VIX) traded in a wide range between 12.40 and 13.50 before coming to rest toward the lower end, up 1.9%, or 0.2 point.
A Trader's Take:
"The best thing about today's market wasn't the better-than-expected initial claims report this morning," Bell opined, "it had to be the incredible response NFLX had to its earnings report. The stock soared, gaining more than 40% on the day. Not surprisingly," he added, "consumer discretionary stocks were among the sector leaders. Despite all we've heard about how the consumer is dead, these types of names continue to impress."
3 Things to Know About Today's Market:
Today's Top Tweet:
"When the market goes up, people get angry, when it goes down, people get angry. Stop being so bitter and maybe you'll see things clearer."
@jfahmy, (Joseph Fahmy), 8:06 a.m.
5 Stocks We Were Watching Today:
Question of the Day:
Q: Is delta fixed once an option is purchased, or does it change?
A: Delta is a dynamic variable that changes as the stock price moves. Delta also changes when the underlying stock's volatility changes, and as the option approaches expiration. In short, the delta is not fixed once an option is bought, and can change quite a bit from the time an option is purchased until it expires.
For example, if you buy an out-of-the-money call option and the stock price rises as expected, your option will go in the money. As a result, the delta will move closer to 1, or 100%, as expiration approaches. These changes to your option's delta are quantified by a separate Greek, known as gamma. Specifically, gamma reflects the unit change in the delta for a one-point change in the underlying stock or index.
For a look at today's options movers and commodities activity, head to page 2.
The Case for Big Moves in IWM and QQQ
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