Dow Sinks 291 Points; Microsoft, Caterpillar Earning Misses

A weaker dollar propped up oil and gold

Jan 27, 2015 at 4:26 PM
facebook twitter linkedin


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%.

CLOSING SUMMARY – INDICES

CLOSING SUMMARY – NYSE AND NASDAQ

5 Items on Our Radar Today:

  1. 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)
  2. 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)
  3. NFLX sat out the sell-off, triggering a wave of bullish options action.
  4. Likewise, GPRO took the road less traveled, and one trader constructed a cautiously optimistic spread.
  5. Analysts responded to unimpressive guidance from Peabody Energy Corporation (BTU) and Dunkin Brands Group Inc (DNKN).
EARNINGS

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

STOCKS – NOTABLE CALL ACTIVITY

STOCKS – NOTABLE PUT ACTIVITY

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.

 

If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!

SCHAEFFER'S JULY STOCKS REPORT AD
 


 


 
Special Offers from Schaeffer's Trading Partners