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Dow Jones Industrial Average Soars Triple Digits, Nasdaq Notches New High

The DJI traded comfortably higher as Wall Street cheered easing geopolitical concerns

by 8/18/2014 4:18:35 PM
Stocks quoted in this article:

The Dow Jones Industrial Average (DJI) skyrocketed out of the gate and never looked back, as traders cheered apparent progress between Russia and Ukraine. Among equities in focus, discount retailers headlined Merger Monday, after Dollar General Corp. (NYSE:DG) outbid Dollar Tree, Inc. (NASDAQ:DLTR) for Family Dollar Stores, Inc. (NYSE:FDO), offering $78.50 per share in cash. The deal-making bolstered optimism about the collective corporate pocketbook, and upbeat housing data was merely icing on the proverbial cake. By the close, the Dow secured a solid triple-digit lead, while the Nasdaq Composite (COMP) notched a 14-year high.

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

Trading Topic of the Week -- Reasons to Dodge Directional Risk: Increase the odds of a winning trade. All other things being equal, a straddle is more likely to end up a winner than an at-the-money call or put -- the strategy boasts a 42% win rate, compared to roughly 34% for a directional play.

The Dow Jones Industrial Average (DJI - 16,838.74) maintained solid ground throughout the session, eventually settling near an intraday peak, up 175.8 points, or 1.1%. In fact, the blue-chip barometer landed atop its 20-day moving average for the first time since July 24. Merck & Co., Inc. (NYSE:MRK) led the four declining black sheep, down 0.3%, while United Technologies Corporation (NYSE:UTX) paced the advancing majority with a 2.3% gain.

The S&P 500 Index (SPX - 1,971.73) also finished near a session high, tacking on 16.7 points, or 0.9%. The Nasdaq Composite (COMP - 4,508.31) followed suit, adding 43.4 points, or 1%, to end just shy of its freshly recorded 14-year high of 4,509.16.

The CBOE Volatility Index (VIX - 12.32) gave up 0.8 point, or 6.3%, marking its lowest close since July 24.

CLOSING SUMMARY – INDICES

CLOSING SUMMARY – NYSE AND NASDAQ

5 Items on Our Radar Today:

  1. Foreign ministers from Russia and Ukraine over the weekend agreed on the delivery of alleged humanitarian aid from Moscow, though heavy fighting around the countries' border continues. The Ukraine military today accused pro-Russian rebels of shooting rockets at a convoy of buses, killing dozens of civilians, though rebel leaders have denied the attack. (Reuters)
  2. Data from the National Association of Home Builders (NAHB) showed a surge in confidence among builders in July. Specifically, the NAHB sentiment index rose to 55 -- its highest point since January -- compared to expectations for the index to remain at 53. (CNBC)
  3. Fabrinet (NYSE:FN) was temporarily halted after postponing its earnings report.
  4. These three stocks benefited from fresh "outperform" ratings.
  5. JA Solar Holdings Co., Ltd. (ADR) (NASDAQ:JASO) option players are optimistic ahead of earnings.
EARNINGS

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

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