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Disappointing JPMorgan Earnings Pressure Dow Jones Industrial Average

Thursday's risk-off bias on Wall Street spread to global markets

by 4/11/2014 8:11:39 AM
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The Dow Jones Industrial Average (INDEXDJX:DJI) is poised to extend Thursday's sharp decline, with futures pointed lower ahead of the bell. "Key support was taken out yesterday pretty much across the board, and the bears appear to be in control of the market at this time," commented Schaeffer's Senior Trading Analyst Bryan Sapp. "The former support level of 1,840 on the S&P 500 Index (SPX) is now resistance, and the next level to watch for a potential bounce is 1,800."

In today's session, the blue-chip barometer is being pressured by JPMorgan Chase & Co. (NYSE:JPM), after the financial firm reported first-quarter earnings results that missed analysts' estimates. The stock is down more than 3% in pre-market trading. Sector peer Wells Fargo & Co (NYSE:WFC) will also unveil its quarterly report this morning, and ahead of the results, the equity is modestly lower.

Plus, our Trading Topic of the Week -- Tips for Trading Stock Trends: Don't sweat the small stuff. When you're playing trends, it's important to remember that stocks don't move in straight up-and-down lines. There's no need to panic out of the trade at the first hiccup in the share price.

And now, on to the numbers...

Dow Jones Industrial Average, S&P and Nasdaq futures

Futures on the Dow Jones Industrial Average (INDEXDJX:.DJI) are more than 66 points below breakeven.

Market Statistics

The Chicago Board Options Exchange (CBOE) saw 1,030,621 call contracts traded on Thursday, compared to 720,460 put contracts. The resultant single-session put/call ratio surged to 0.70 -- its highest perch since March 12 -- while the 21-day moving average remained at 0.58.

NYSE and Nasdaq summary

Volatility indices

From the Trading Floor

"The two sentiment polls that came out on Thursday -- the American Association of Individual Investors (AAII) and the National Association of Active Investment Managers (NAAIM) -- continue to show decreased bullishness among market participants," noted Sapp. "One would have to think that after a horrific day like yesterday, these levels would continue to deteriorate. While the bears remain in control, the current sentiment backdrop will provide a nice risk/reward trade from the long side at some point in the near future. However, the dust will definitely need to settle before the bulls can retake the market."

Currencies and Commodities

  • The U.S. dollar index is flirting with a 0.1% lead ahead of the bell, with the greenback lingering near 79.43.
  • Elsewhere, crude oil is on pace to extend yesterday's losses, down 0.1% at last check to trade at $102.29 per barrel.
  • Conversely, gold is looking to add to Thursday's gains, with the malleable metal up 0.1% at $1,322.30 an ounce.
Currencies and commodities

Earnings and Economic Data

The producer price index (PPI) and the core PPI, plus the Thomson Reuters/University of Michigan's preliminary consumer sentiment report for April, will hit the Street today. Closing out the week are earnings reports from JPM, WFC, and Fastenal (FAST).

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