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A weaker dollar propped up oil and gold
The Dow Jones Industrial Average (INDEXDJX:DJI) kicked off the session with a triple-digit drop and never looked back. The bearish stars aligned as a basket of blue chips unveiled unimpressive earnings reports -- led by disappointments from Microsoft Corporation (NASDAQ:MSFT) and Caterpillar Inc. (NYSE:CAT) -- and selling pressure was exacerbated by a surprise drop in durable goods orders. In after-hours action, traders are digesting the latest numbers from Apple Inc. (NASDAQ:AAPL), and biting their nails ahead of tomorrow's Federal Open Market Committee (FOMC) policy statement.
Continue reading for more on today's market, including:
The Dow Jones Industrial Average (DJI - 17,387.21) was down more than 390 points at its intraday low, and gave up 291.5 points, or 1.7%, by the time the bell mercifully sounded. Just United Technologies Corporation (NYSE:UTX) settled north of breakeven, eking out a 0.4% gain, while MSFT led the 29 declining equities with a 9.3% drop.
The S&P 500 Index (SPX - 2,029.55) traveled a similar path, shedding 27.5 points, or 1.3%. The tech-rich Nasdaq Composite (COMP - 4,681.50) fared the worst of its peers, surrendering 90.3 points, or 1.9%.
The CBOE Volatility Index (VIX - 17.22) soared 1.7 points, or 11%.
5 Items on Our Radar Today:
- Orders for durable goods unexpectedly fell 3.4% in December, compared to expectations for a 0.1% uptick. On the flip side, consumer confidence jumped to its highest point since August 2007 in January, according to the Conference Board's consumer confidence index. (MarketWatch)
- Single-family home price growth dipped to a two-year low in November, per the S&P/Case-Shiller index, though the report arrived in line with expectations. Specifically, the 20-city index rose 4.3% year-over-year, marking the slowest rate of appreciation since October 2012. (Reuters)
- NFLX sat out the sell-off, triggering a wave of bullish options action.
- Likewise, GPRO took the road less traveled, and one trader constructed a cautiously optimistic spread.
- Analysts responded to unimpressive guidance from Peabody Energy Corporation (BTU) and Dunkin Brands Group Inc (DNKN).
For a look at today's options movers and commodities activity, head to page 2.
Commodities:
A softer greenback translated into a rebound for dollar-denominated crude, with the commodity snapping its three-day skid ahead of tomorrow's weekly inventories report. By the close, March-dated crude added $1.08, or 2.4%, to settle at $46.23 per barrel.
Gold also gained ground on the heels of a weaker dollar, and as traders sought "safe haven" investments in the wake of a sell-off in equities. Ahead of tomorrow's policy statement from the Fed, gold for February delivery tacked on $12.30, or 1%, to end at $1,291.70 an ounce.