Stocks started the fourth quarter on a sour note today, thanks to disappointing manufacturing data and another ominous unemployment report. The Institute for Supply Management's (ISM) index of manufacturing activity was the primary bee in the bulls' bonnet, falling to 52.6 in September from 52.9 in August defying analysts' expectations. Elsewhere, selling pressure escalated following news that initial jobless claims soared by more than forecast last week. The dismal data in conjunction with Wednesday's discouraging ADP report spooked the Street, as investors await the government's highly anticipated nonfarm payrolls report tomorrow. Against this backdrop, the somber statistics overshadowed positive home sales and consumer spending reports, with the Dow Jones Industrial Average (DJIA) swallowing its largest single-session loss since July 2.
The Dow Jones Industrial Average (DJIA 9,509.28) fell to a triple-digit deficit within the first hour of trading today, eventually settling on a loss of 203 points, or 2.1%. All 30 of the Dow's blue chips finished in the red, with financial issues American Express (AXP), Bank of America (BAC), and JPMorgan Chase (JPM) pacing the decline. The blue-chip barometer is now testing support at its 10-week moving average, which hasn't been breached on a weekly closing basis since mid-July.
The S&P 500 Index (SPX 1,029.85) also dipped right out of the gate today, extending its journey lower through the closing bell. When the dust finally settled, the index finished with a loss of 27.2 points, or 2.6%, and is now testing support at its own 10-week trendline. Finally, the Nasdaq Composite (COMP 2,057.48) fared the worst of the major market indexes, surrendering 64.5 points, or 3.1%, by the close.
Turning to equities in focus, Deere & Company (DE) reached a tentative agreement with the United Auto Workers (UAW) union ... MannKind Corporation (MNKD) just kicked off a historically horrid quarter ... A straddle strategist is anticipating lethargic price action for Microsoft Corp. (MSFT) in the near term ... Schaeffer's Tool Box took a retrospective look at a hypothetical iron condor on Potash Corp. of Saskatchewan (POT) ... Offshore drilling diva Transocean LTD. (RIG) appeared as a potential ratio call spread candidate ... and today's Quote of the Day comes from marketing consultant Ernest Lupianacci. An agent for Michael Vick on Wednesday claimed the Philadelphia Eagles quarterback signed a new deal with NIKE Inc. (NKE). However, the athletic apparel firm issued a statement that says otherwise, reiterating that it does not have a contractual relationship with the image-tainted Vick. In the wake of the goof, Lupianacci a former creative director for Nike advertising summed up the endorsement confusion with this astute observation:
"This agent put his Air Vick in his mouth."
But these weren't the only headlines hitting the Street today. Click on the links below for our Daily Option Blog coverage of:
And, in case you missed it, Joseph Hargett noted the widespread skepticism levied against the uptrending shares of Nordstrom Inc. (JWN). Click here to watch the video.
For today's activity in crude oil, gold futures, options, and more, turn to page 2.
Crude futures finished a choppy session in the black today, despite easing geopolitical tensions in the Middle East. After days of escalating uneasiness, Iran has signaled that it will cooperate with the International Atomic Energy Agency (IAEA) regarding the inspection of its nuclear power facilities. The U.S. warned again today that Iran the second-biggest oil producer in the Organization of Petroleum Exporting Countries (OPEC) could face additional sanctions if it doesn't maintain harmony with the IAEA. Against this backdrop and with the emergence of fourth-quarter buyers crude for November delivery added a modest 21 cents, or 0.3%, to finish at $70.82 per barrel.
Gold futures dipped lower today, but maintained a foothold atop the psychologically significant millennium marker. Weighing on the precious metal was a strengthening dollar, which gained ground against a basket of its foreign rivals. In addition, demand-related concerns from top gold-consuming countries helped pressure the malleable metal lower. Figures from the Istanbul Gold Exchange showed that gold demand in Turkey one of the world's top bullion consumers fell 94% in September, compared to a year earlier. By the close, December-dated gold surrendered $8.60, or 0.9%, to end at $1,000.70 an ounce.
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