Dow Jones Industrial Average Ends Lower, Commodities Sag

eBay Inc (EBAY) and PayPal are going their separate ways

by 9/30/2014 4:24:31 PM
Stocks quoted in this article:

The Dow Jones Industrial Average (DJI) ended slightly in the red, as portfolio managers modified their positions for the end of the third quarter, and traders reacted to a number of economic reports that came in below expectations -- including the Conference Board's consumer confidence index and the S&P Case-Shiller home price index. The broader S&P 500 Index (SPX) and tech-heavy Nasdaq Composite (COMP) followed suit, each posting its own modest loss. Elsewhere, commodities were in focus, as gold and oil reeled amid an ever-strengthening dollar.

Continue reading for more on today's market, including:

  • After announcing a planned spinoff of PayPal, eBay Inc (NASDAQ:EBAY) found itself overwhelmed by call players.
  • Takeover buzz buoyed shares of Whole Foods Market, Inc. (NASDAQ:WFM), and option buyers responded, targeting end-of-week gains.
  • A look at how options traders placed their bets on Ford Motor Company (NYSE:F), following a disappointing investor day.
  • Plus ... Details on the Apple Inc. (NASDAQ:AAPL) tax probe, the latest insider trading allegations, and another high for GoPro Inc (NASDAQ:GPRO).
Trading Topic of the Week -- Tips for Buying Weekly Options: DON'T be tempted by the cheapest option available. It may seem like a good idea to keep your entry costs low by purchasing the lowest-priced option available. However, bear in mind that the cheapest contracts are most likely to expire worthless.

The Dow Jones Industrial Average (DJI - 17,042.90) saw both sides of breakeven, but ultimately finished 28.3 points, or 0.2%, lower. Thirteen of the DJI's 30 components ended in the green, with Visa Inc (NYSE:V) leading the way with a 1.2% advance. McDonald's Corporation (NYSE:MCD) paced the index's 17 losers, down 1.5%. For the month, the DJI lost 0.3%, but added 1.3% for the third quarter.

The S&P 500 Index (SPX - 1,972.29) dipped 5.5 points, or 0.3%, to finish below its 50-day moving average for just the second time since Aug. 15. The Nasdaq Composite (COMP - 4,493.39) gave back 12.5 points, or 0.3%. For September, the SPX and COMP fell 1.6% and 1.9%, respectively, but extended their quarterly win streaks to seven, with gains of 0.6% and 1.9%.

The CBOE Volatility Index (VIX - 16.31) picked up 0.3 point, or 2.1%, for its first finish north of 16 since Aug. 7. For the month, the market's "fear gauge" jumped 36.1%, and for the quarter, 41%.

CLOSING SUMMARY – INDICES

CLOSING SUMMARY – NYSE AND NASDAQ

5 Items on Our Radar Today:

  1. Antitrust officials in the European Union (EU) published certain details of their decision to probe AAPL's tax arrangements with Ireland. A letter sent to Irish authorities accused the nation of conferring unfair tax benefits to the iPhone maker. The company promptly denied the charges, saying, "Apple has received no selective treatment from Irish officials over the years. We're subject to the same tax laws as the countless other companies who do business in Ireland." (USA Today)
  2. U.S. consumer confidence fell to its lowest level in four months in September, according to the Conference Board's index. What's more, the steeper-than-expected 7.4-point drop was the largest monthly decline in nearly a year, when the federal government was in the midst of a partial shutdown. (Chicago Tribune)
  3. A pair of men have been charged with insider trading by the Securities and Exchange Commission. One of the two individuals allegedly acted on then-secret knowledge that Pershing Square Capital Management was going to take a short position on Herbalife Ltd. (NYSE:HLF), making $47,100 with put options. (CNBC)
  4. GPRO showed no signs of slowing down today -- touching yet another record high -- convincing these short-term option bulls that triple-digit territory is on the horizon.
  5. News of a Crouching Tiger, Hidden Dragon sequel produced by Netflix, Inc. (NASDAQ:NFLX) had traders eyeing end-of-week upside for the shares.
EARNINGS

For a look at today's options movers and commodities activity, head to page 2.

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