Uplifting Data Helps Dow Jones Industrial Average Bounce Back

2 Stocks with Bargain-Basement Options

by Karee Venema

Published on Jun 3, 2015 at 4:27 PM
Updated on Jun 4, 2015 at 9:55 AM

After a brief dip below breakeven at the open, the Dow Jones Industrial Average (DJIA) took off and never looked back. Helping stoke the bullish flames was the latest round of economic reports -- including an ADP report that fueled optimism ahead of Friday's payrolls data -- as well as central bank news from overseas. Additionally, speculators eyed soaring bond yields and still-unresolved debt talks in Greece, expressing hope that a deal will be reached before this Friday's highly anticipated deadline. The upbeat outlook was seen elsewhere, with both the S&P 500 Index (SPX) and Nasdaq Composite (COMP) erasing Tuesday's modest losses.

 

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

 

 

The Dow Jones Industrial Average (DJIA - 18,076.27) charted a 158-point range today, with most of the action occurring to the upside. By the close, the DJIA was up 64.3 points, or 0.4%. Of the Dow's 30 components, 21 finished higher, led by Home Depot Inc's (NYSE:HD) 1.4% pop. Intel Corporation's (NASDAQ:INTC) 1.6% loss paced the eight decliners, while DuPont (NYSE:DD) was unchanged.

 

The S&P 500 Index (SPX - 2,114.07) spent the entire session above breakeven, eventually settling with a 4.5-point, or 0.2%, gain. The Nasdaq Composite (COMP - 5,099.23) came within 6 points of notching a new 15-year peak, but pared this advance to 22.7 points, or 0.5%, by the close.

 

The CBOE Volatility Index (VIX - 13.66) lost its short-term footing north of its 80-day moving average, giving back 0.6 point, or 4.1%.
 

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5 Items on Our Radar Today:

 

  1. The Fed's Beige Book indicated the U.S. economy expanded over the past two months. This followed earlier economic reports from ADP -- which showed private payrolls increased by a slightly better-than-expected 201,000 last month -- and the Commerce Department, which revealed the trade deficit shrank 19% in April, its biggest percentage decline in six years. Elsewhere, the Institute for Supply Management (ISM) said activity in the service sector slowed by a wider-than-expected rate. (Bloomberg; USA Today; MarketWatch)
  2. Greek Prime Minister Alexis Tsipras warned the fiscally strapped country may miss its payment to the International Monetary Fund (IMF) -- due on Friday. However, Tsipras did agree in a subsequent phone call with German Chancellor Angela Merkel and French President Francois Hollande that Greece must find a solution for its fiscal woes. (Reuters)
  3. After hitting some turbulence on Tuesday, AAL got smacked with a negative analyst note -- and another daily loss.
  4. Option bulls targeted these two surging social media stocks, while sector peer LinkedIn Corp (NYSE:LNKD) won the heart of J.P. Morgan Securities.
  5. Option traders rolled the dice on extended gains for China-based names Weibo Corp (ADR) (NASDAQ:WB) and NQ Mobile Inc (ADR) (NYSE:NQ).

 

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Commodities:

 

Crude oil tumbled today, amid speculation that the Organization of the Petroleum Exporting Countries (OPEC) will leave production rates as is, as well as concern over a big build in distillate stockpiles. At the close, crude for July delivery was down $1.62, or 2.6%, at $59.64 per barrel.

 

Strong economic data and European Central Bank President Mario Draghi's upbeat outlook of the economy sent gold futures lower today. By the close, August-dated gold was off $9.50, or 0.8%, at $1,184.90 per ounce -- a three-week low.

 

 


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