Dow Jones Industrial Average Erases Big Gains as Fed Eyes Balance Sheet

How April Options Traders Are Playing SNAP

Apr 5, 2017 at 4:28 PM
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The Dow Jones Industrial Average (DJIA) started the day broadly higher, boosted by a major upside surprise in this morning's ADP payrolls report. However, those early buyers had hit the bricks by the time the closing bell sounded. Helping to spark the afternoon slump was the latest Fed update, as the March meeting minutes showed policymakers preparing to scale back the central bank's massive $4.5 trillion balance sheet. At the end of the session, the Dow had completely erased a triple-digit gain, while the S&P 500 retreated from a high of 2,378 back toward the magnetic 2,350 level.
 
Continue reading for more on today's market, including:

  • Bernie Schaeffer weighs in on the bold bets of SNAP options traders.
  • Inside the nearly $1 million wager on an emerging markets sell-off.
  • Banking bulls eyed front-month plays on XLF.
  • Plus, the latest iPhone 8 rumors; shocking news from Taser; and gold's winning streak comes to an end.

The Dow Jones Industrial Average (DJIA - 20,648.15) was up 198 points at its session high, but closed on a loss of 41 points, or 0.2%. Eleven of the Dow's 30 components ended higher, led by McDonald's Corporation (NYSE:MCD); meanwhile, the biggest Dow mover overall was JPMorgan Chase (NYSE:JPM), off 1.3% by the close. On the charts, the Dow is sandwiched between support at its rising 50-day moving average and recent congestion around 20,700.

The S&P 500 Index (SPX - 2,352.95) topped out just shy of 2,380 -- site of its March 1 opening gap higher -- before finishing on a drop of 7.2 points, or 0.3%. The Nasdaq Composite (COMP - 5,864.48) touched a record high of 5,936.39 on an intraday basis, but ultimately settled lower by 34.1 points, or 0.6%.

The CBOE Volatility Index (VIX - 12.89) bottomed out at 10.90 intraday -- its lowest level since March 17 -- but roared back to close up 1.1 points, or 9.3%.

closing indexes summary april 5
nyse and nasdaq stats april 5

5 Items on Our Radar Today

  1. U.S. Ambassador to the United Nations Nikki Haley condemned Russia following Tuesday's chemical bombing in civil war-torn Syria, asking "How many more children have to die before Russia cares?" in her remarks at an emergency session of the UN Security Council. Haley also indicated that the U.S. may take independent military action if the UN "fails in its duty to act collectively." (CNN)
  2. Rumors ramped up today that the Apple iPhone 8 may not launch until October or November, missing the traditional September window for upgraded versions of the device. The questionably sourced reports didn't hurt AAPL stock, as the shares touched a new record high of $145.46. (CNBC)
  3. What short sellers are up to -- and what it means for stocks.
  4. Wall Street is upbeat ahead of earnings from a second-quarter standout.
  5. The TASR news that triggered a volatile session for the stock.

corporate earnings april 5_

unusual options activity april 5
Data courtesy of Trade-Alert

Commodities

Oil futures finished higher today, despite a surprise jump in domestic inventories last week -- along with smaller-than-forecast declines in gasoline and distillate stocks. However, as traders considered increased refinery utilization and upbeat economic data, crude futures for May delivery added 12 cents, or 0.2%, to settle at $51.15 per barrel.

Gold futures fell today, with the traditional "safe haven" asset weighed down by an upbeat report on private-sector jobs. June-dated gold tumbled $9.90, or 0.8%, to settle at $1,248.50 an ounce, bringing its three-session win streak to an end.

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