Dow Jones Industrial Average Jumps 304 Points; S&P Makes It 5 in a Row

Why the Overbought VIX Trade Still Works

Oct 5, 2015 at 4:26 PM
facebook twitter linkedin


It was a big day on Wall Street today, with all three major indexes scoring solid wins. Not only did the Dow Jones Industrial Average (DJIA) climb out of correction territory -- thanks to rallies from a pair of blue-chip heavyweights -- but the Nasdaq Composite (COMP) jumped back above its year-to-date breakeven line. Additionally, the S&P 500 Index (SPX) took a big step in proving that past can be precedent -- and extended its gains to a fifth consecutive session to notch its longest win streak since last December.

With a relatively bare economic and earnings calendar, today's pop came courtesy of a technical boost, as indexes continued to bounce off August lows. However, a handful of market-moving macro events are on this week's docket -- including hints to the Fed's recent interest-rate decision and a fresh batch of quarterly earnings -- so, more volatility is likely ahead.

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

 

The Dow Jones Industrial Average (DJIA - 16,776.43) was 326 points higher at its session peak -- and settled not too far from there, up 304 points, or 1.9%. Twenty-nine of the Dow's 30 components gained ground, led by 5.3% pops for General Electric Company (NYSE:GE) and Caterpillar Inc. (NYSE:CAT). Nike Inc (NYSE:NKE) was the lone laggard, shedding 0.8%.
 
The S&P 500 Index (SPX - 1,987.05) added 35.7 points, or 1.8%, while the Nasdaq Composite (COMP - 4,781.26) jumped 73.5 points, or 1.6%.

The CBOE Volatility Index (VIX - 19.54) gave back 1.4 points, or 6.7%, to close at its lowest level since Aug. 20.



151005recap1

151005recap2

5 Items on Our Radar Today:

  1. The Institute for Supply Management's (ISM) non-manufacturing purchasing managers index fell to 56.9 in September from 59 in August. In July, the reading topped out at a record high of 60.3. (FOX Business)
  2. The Justice Department ordered BP to pay $20 billion to settle claims regarding the 2010 Deepwater Horizon oil spill. This is the largest fine in the court's history, and still needs to be approved by a federal judge. (ABC News)
  3. Despite getting slapped with a price-target cut, DE jumped 6.4% on news of a big win with United Auto Workers.
  4. How weekly option traders have been lining up on these 2 energy issues.
  5. Stifel took note of this network equipment specialist's surge up the charts.


151005recap4

151005recap5

Commodities:

 

Crude oil started the week on a strong note, thanks to stimulus hopes from overseas and reports that Russia is willing to meet with both OPEC and non-OPEC oil producers. By the close, crude for November delivery was up 72 cents, or 1.6%, at $46.26 per barrel.

Gold, meanwhile, rose for a second straight session, with the December-dated contract settling up $1, or 0.1%, at $1,137.60 per ounce.

 

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 

 


 


 
Special Offers from Schaeffer's Trading Partners