"It was a tale of two halves, as the market bounced big early in the day, then sellers took over the second half of the day," recapped Schaeffer's Senior Technical Strategist Ryan Detrick, CMT. "In fact, small-caps and tech were actually leading early -- but just as we've seen many times the past several weeks, those bounces were very short-lived. In fact, it was the opposite of yesterday, where the market was down early and rallied the second half of the day. All in all, this just hammers home how choppy things have been recently. Against this backdrop, the Dow Jones Industrial Average (DJI) took out its all-time closing high in intraday action, but had pared a healthy portion of its gains by the close.
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The Dow Jones Industrial Average (DJI - 16,550.97) toppled its April 30 all-time closing high in midday action, but settled below this threshold, gaining just 32.4 points, or 0.2%. At its high-water mark, the blue-chip index was in the black by nearly 105 points. Pacing the Dow's 18 advancing names was AT&T Inc. (NYSE:T), which gained 1.8%. For the third time running, Merck & Co., Inc. (NYSE:MRK) brought up the rear, shedding 1.8%.
The S&P 500 Index (SPX - 1,875.63) spent most of the first half of the day in positive territory -- hitting an intraday peak of 1,889.07, but unraveled into the close, settling off 2.6 points, or 0.1%. Underperforming once again was the tech-rich Nasdaq Composite (COMP - 4,051.50), which fell 16.2 points, or 0.4%.
The CBOE Volatility Index (VIX - 13.43) spent time on both sides of the flat line before closing marginally higher, up 0.03 point, or 0.2%.
A Trader's Take:
"What sparked today's selling seemed to be a poorly received 30-year bond auction around 1 p.m. ET," noted Detrick. "Bonds took a big hit, and with that brought a good deal of afternoon volatility. This had many scratching their heads, as bond prices and stocks both traded the same way the final few hours -- lower. Add it all up, and many market participants are stumped by what is happening. One hour, a big S&P 500 breakout looks imminent, then by the end of the day, stocks have sold off hard. Or we've seen some big dips early, only to be bought. The bulls and bears continue to fight to a near dead heat when you look at the S&P 500 and Dow, but under the surface, small-caps continue to fire a potential warning sign as they keep dropping."
5 Items on Our Radar Today:
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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