Bonds Take Dow Jones Industrial Average On a Wild Ride

It was a wild ride on Wall Street today, with the Dow Jones Industrial Average (DJIA) trading in a nearly 200-point range -- mostly on the south side of breakeven. The day's initial sell-off was sparked by a sharp rise in bond yields, but the action began to stabilize shortly after midday. Also helping the Dow to fight back from steep losses -- and maintain a foothold atop 18,000 -- was a big rally in energy names, with blue chips Chevron Corporation (NYSE:CVX) and Exxon Mobil Corporation (NYSE:XOM) each benefiting as the stars aligned for crude.

 

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

 

• Is more downside ahead for these 2 social media stocks? Option traders certainly hope so.
• Option bulls will be keeping a close eye on the earnings reactions for this blue chip and this fast-food concern.
• In case you missed it, Schaeffer's Senior VP of Research Todd Salamone explained why an early summer breakout could be in the cards.
• Plus, economic data starts to pour in, the Fed official raining on the Street's parade, and the for-profit educator getting smacked by the SEC.

 

The Dow Jones Industrial Average (DJIA - 18,068.23) was down more than 180 points at its session low -- and south of 18,000 -- but pared these losses to 36.9 points, or 0.2%. Twenty-one of the Dow's 30 components landed in the red, led by Intel Corporation's (NASDAQ:INTC) 1.4% drop. Wal-Mart Stores, Inc.'s (NYSE:WMT) 1.1% gain paced the nine advancers.

 

The S&P 500 Index (SPX - 2,099.12) settled with a 6.2-point, or 0.3%, loss, while the Nasdaq Composite (COMP - 4,976.19) fared the worst of its peers -- surrendering 17.4 points, or 0.4%.

 

The CBOE Volatility Index (VIX - 13.86) rallied north of 15, but ran into resistance at its 80-day moving average -- a trendline not conquered on a daily closing basis since March 11. At session's end, the market's "fear gauge" settled on a slimmer 0.01-point, or 0.1%, gain.

 

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5 Items on Our Radar Today:

 

1. In its latest Job Openings and Labor Turnover Survey, the Bureau of Labor Statistics said the U.S. added 5 million jobs in March -- a modest slip from February's 5.1 million jobs. Elsewhere, the Treasury Department revealed April's budget surplus of $156.7 billion was its highest since 2008. (CNBC; Bloomberg)
2. Less than a week after the April jobs report soothed concerns of a June rate hike, San Francisco Fed President John Williams said he'd prefer the Federal Reserve to raise rates "a bit earlier." Specifically, he thinks doing so sooner-rather-than-later will allow for a gradual lift-off, which he believes is the "safer course." (MarketWatch)
3. ITT Educational Services, Inc. (NYSE:ITT) plunged -- and hit its lowest mark on record along the way -- after the Securities and Exchange Commission (SEC) slapped the company and two executives with fraud charges.
4. Option bears most likely had decidedly different reactions to the post-earnings moves for Clean Energy Fuels Corp (NASDAQ:CLNE) and Intrexon Corp (NYSE:XON).
5. A refreshing take on the VIX, courtesy of Schaeffer's contributor Adam Warner.

 

 Commodities:

 

Crude rallied above the round-number $60 mark today, amid a number of well-received developments. Specifically, a weakening dollar, renewed airstrikes in Yemen, a slight increase in the Organization of the Petroleum Exporting Countries (OPEC) 2015 world oil demand growth forecast, and the Energy Information Administration's (EIA) expectations for a production decline next month helped buoy black gold. By the close, crude for June delivery was up $1.50, or 2.5%, at $60.75 per barrel -- the second-highest settlement of 2015.
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Gold futures also got a boost from the cooling dollar. At session's end, June-dated gold had added $9.40, or 0.8%, to settle at $1,192.40 per ounce.

 

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