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Upbeat Yellen, Tech Stocks Lift Dow Jones Industrial Average

Is Investor Optimism Ringing Alarm Bells?

Dec 19, 2016 at 4:27 PM
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The Dow Jones Industrial Average (DJIA) traded on both sides of breakeven today, and while the price action eventually resolved to the upside, the Dow fell short of the closely watched 20,000 level and fresh record highs. Following last week's relatively hawkish tone, Fed Chair Janet Yellen held traders' attention once again, giving a fairly upbeat outlook on the U.S. economy during a commencement speech at the University of Baltimore. "[Y]ou are entering the strongest job market in nearly a decade," Yellen said, adding that the current unemployment rate "has been associated with good job opportunities." Meanwhile, a strong showing from tech stocks -- as well as rising oil prices -- helped the Dow and its index peers overcome disappointing economic data.
 
Continue reading for more on today's market, including:
 

The Dow Jones Industrial Average (DJIA - 19,883.06) rose 39.7 points, or 0.2%, as 19 of 30 blue-chip stocks closed higher. United Technologies Corporation (NYSE:UTX) and Microsoft Corporation (NASDAQ:MSFT) were at the top of the board with gains of 2.1% apiece, while the biggest loss was a 2.1% drop for Merck & Co., Inc. (NYSE:MRK). 

The S&P 500 Index (SPX - 2,262.53) added 4.5 points, or 0.2%, and the Nasdaq Composite (COMP - 5,457.44) picked up 20.3 points, or 0.4%. 

The CBOE Volatility Index (VIX - 11.71) lost 0.5 point, or 4%, for its lowest close since Aug. 19. 

Indexes summary December 19
NYSE and Nasdaq December 19

5 Items on Our Radar Today

  1. In what Russia is calling a terrorist attack, the country's ambassador to Turkey was shot and killed while giving a speech today. The shooter, an off-duty police officer, shouted "Don't forget Aleppo" after the shooting. (Reuters)
  2. Christine Lagarde, the head of the International Monetary Fund (IMF), has been found guilty of negligence in a case she oversaw as France's finance minister in 2008. Lagarde will not face prison time, and it remains unclear how the ruling will affect her position at the IMF.  (NPR)
  3. The $2.5 billion M&A announcement that sank this fertilizer stock and its sector peer.
  4. Nike Inc (NYSE:NKE) options traders are eyeing this key level ahead of earnings
  5. Options traders are circling these 2 toy stocks this holiday season. 

Quarterly Earnings December 19
Unusual options activity December 19
Data courtesy of Trade-Alert

Commodities:

Oil prices gained today, as traders considered possible geopolitical risks following the shooting of Russia's ambassador to Turkey. January-dated crude futures -- which expire tomorrow -- added 22 cents, or 0.4%, to settle at $52.12 per barrel.

Meanwhile, the price of gold also rose. Gold futures dated for February added $5.30, or 0.5%, to close at $1,142.70 per ounce. 

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