Dow Jones Industrial Average Eyes Another Loss as Trump Inauguration Looms

Why Stocks Could Retreat After Trump Takes Office

Jan 19, 2017 at 11:58 AM
facebook twitter linkedin


The Dow Jones Industrial Average (DJIA) has given up an early lead, sliding into negative territory, as stocks continue to cool ahead of Donald Trump's inauguration tomorrow. After this morning's European Central Bank (ECB) decision and subsequent press conference from ECB President Mario Draghi, traders are now keeping tabs on Treasury Secretary nominee Steven Mnuchin's confirmation hearing and awaiting a speech from Fed Chair Janet Yellen. In economic news, the Philadelphia Fed business outlook survey was stronger than expected, while housing starts rebounded in December. With the blue-chip earnings slate set to pick up, the Dow is staring down a fifth straight loss, while the Nasdaq Composite (COMP) is also struggling despite a post-earnings surge from Netflix, Inc. (NASDAQ:NFLX).

Continue reading for more on today's market -- and don't miss:

midday market stats jan 19

Among the stocks with unusual options volume is nutrition retailer GNC Holdings Inc (NYSE:GNC), due to an ugly bear note from Goldman Sachs. The stock earlier hit an all-time low of $9.28, and was last seen 15.8% lower at $9.39 -- and on the short-sale restricted list -- with both calls and puts trading well above their average intraday volumes. In fact, overall option volume on GNC is on pace to hit an annual high. The most popular option so far is the February 7.50 put. Anyone buying to open positions here is betting on the shares falling further into record-low territory and breaching the $7.50 mark by Friday, Feb. 17, when the options expire. 

Transportation concern CSX Corporation (NASDAQ:CSX) is near the top of the Nasdaq, after Canadian Pacific Railway Limited (USA) (NYSE:CP) CEO Hunter Harrison stepped down earlier than expected, and is rumored to be pairing up with an activist to take aim at CSX. Shares of CSX were last seen 17.1% higher at $43.17, and earlier touched an all-time high of $43.75. The stock has now more than doubled since its low of $21.33 from last January. 

Weekly Chart of CSX Jan 19

One of the biggest losers on the Big Board is United States Steel Corporation (NYSE:X), after Citigroup weighed in bearishly on the steel sector. The shares are down 5.7% at $32.93, but are finding solid support once again at their rising 50-day moving average. Plus, shareholders will likely forgive today's losses, given the stock was trading near $7 this time a year ago.  

The CBOE Volatility Index (VIX) is down 0.1 point, or 0.5%, at 12.42 

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 1.45, with puts outpacing calls. So far today, the SPY is down 0.2 point, or 0.1%, at $226.51. 

Find out where the Dow lands right after the closing bell. Sign up now for Schaeffer's Market Recap

Celebrate 40 Years of Schaeffer's With 4 FREE Stock Picks!


 




 
Special Offers from Schaeffer's Trading Partners