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Dow Jones Industrial Average Poised to Follow Tech Sector Into the Red

Futures on the Nasdaq Composite are lower ahead of the bell

by 4/7/2014 8:11:56 AM
Stocks quoted in this article:

The Dow Jones Industrial Average (INDEXDJX:DJI) is poised to extend Friday's losses, with futures modestly lower ahead of the bell. "The nonfarm payrolls number came in around the consensus forecast on Friday," noted Schaeffer's Senior Options Strategist Tony Venosa, CMT. "In response, markets gapped higher initially, but quickly sold off all the way into the close, as weakness in tech and small-cap issues finally spread to the broader market." The tech sector is signaling continued struggles, with the Nasdaq Composite (COMP) sitting roughly 20 points below breakeven ahead of the bell.

In today's session, the economic calendar is light, with the Federal Reserve's consumer credit report the sole data point on the docket. Meanwhile, St. Louis Fed President James Bullard is slated to speak later this morning. More importantly, Venosa says that "This week will mark the beginning of earnings season, with Alcoa Inc (NYSE:AA) kicking things off tomorrow evening."

Plus, our Trading Topic of the Week -- Tips for Trading Stock Trends: Trust that the trend is your friend (but do your homework). Every trader dreams of capitalizing on the big trend reversal that no one else saw coming. But momentum is a powerful force in the stock market, so why not go with the flow instead of fighting the tide?

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 nearly 26 points below breakeven.

Market Statistics

The Chicago Board Options Exchange (CBOE) saw 1,353,316 call contracts traded on Friday, compared to 881,123 put contracts. The resultant single-session put/call ratio rose to 0.65, while the 21-day moving average stayed at 0.60.

NYSE and Nasdaq summary

Volatility indices

From the Trading Floor

"Last Friday, the SPDR S&P 500 ETF Trust (SPY) hit a high of $189.70," continued Venosa. "This is just a few cents away from huge peak call open interest at the 190 strike that expired at the close, and capped the early morning rally."

Currencies and Commodities

  • The U.S. dollar index is flirting with a 0.1% drop ahead of the bell, with the currency trading near 80.34.
  • Elsewhere, crude oil is churning 0.6% below breakeven, with crude for May delivery last seen at $100.52 per barrel.
  • Gold, meanwhile, is looking to pull back below the $1,300 mark, with futures on the front-month contract down 0.4% at $1,299 an ounce.
Currencies and commodities

Earnings and Economic Data

The Federal Reserve's consumer credit report for February will hit the Street today. There are no notable earnings reports slated for release.

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