Dow Jones Industrial Average Resolves Lower Amid Mixed Earnings

3 Heavily Shorted Stocks Ripe for a Rally

by Andrea Kramer

Published on Oct 20, 2015 at 4:20 PM

The Dow Jones Industrial Average (DJIA) struggled to pick a direction, but ultimately resolved to the downside. On the bullish side of the aisle were encouraging housing stats and well-received earnings from Verizon Communications Inc. (NYSE:VZ), Travelers Companies Inc (NYSE:TRV), and United Technologies Corporation (NYSE:UTX), while the bearish side was dominated by a major earnings miss from International Business Machines Corp. (NYSE:IBM). While the Dow and S&P 500 Index (SPX) waffled throughout the day, the Nasdaq Composite (COMP) took a decisive turn south, due to a dismal day for pharmaceuticals. 

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

Despite several pops above breakeven, the Dow Jones Industrial Average (DJIA - 17,217.11) eventually gave up 13.4 points, or 0.08%. Seventeen of the Dow's 30 components ended lower, led by IBM's post-earnings drop of 5.8%. UTX paced the advancing minority, gaining 3.9%.
 
The S&P 500 Index (SPX - 2,030.77) also danced around the flatline, before settling on a loss of 2.9 points, or 0.1%. The Nasdaq Composite (COMP - 4,880.97) backed down from its 80-day moving average, surrendering 24.5 points, or 0.5%. 

The CBOE Volatility Index (VIX - 15.75) ticked higher for the first session in four, gaining 0.8 point, or 5.1%.


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5 Items on Our Radar Today:

  1. New home construction rose by a bigger-than-expected 6.5% in September. After two months of decline, the Commerce Department reported a nearly eight-year high in housing starts. Just yesterday, we learned that builder confidence jumped to its highest point in a decade. (MarketWatch)
  2. Former Virginia Senator Jim Webb dropped out of the Democratic presidential primary race, leaving just four contenders for the candidacy. Webb says he is weighing his options regarding an independent run. (CNBC)
  3. Facebook Inc (NASDAQ:FB) reached an all-time high just south of the century mark, despite concerns about a pending investigation into its data practices.
  4. Amazon.com, Inc. (NASDAQ:AMZN) continues to fire back at The New York Timesdamning mid-August article, as the online retailer announces plans to hire 100,000 new employees for the holidays. 
  5. The Fresh Market Inc (NASDAQ:TFM) edged higher, after the company said it will conduct a strategic view of its business, possibly exploring a sale.

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Commodities:

Ahead of front-month expiration and tomorrow's weekly stockpile report, November-dated oil futures ended in the red, due to lingering concerns about a global supply glut. By the close, the contract was down 34 cents, or 0.7%, to end at $45.55 per barrel. December-dated crude, on the other hand, added a penny to end at $46.29 per barrel.

Gold bounced back thanks to a softer greenback, and ahead of a European Central Bank meeting later this week. By the close, gold for December delivery was up $4.70, or 0.4%, at $1,177.50 an ounce.


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