Dow Edges Higher; Wall Street on Egg Shells Ahead of CPI

The IEA warned of rapid U.S. oil production, overshadowing an upwardly revised demand forecast

Feb 13, 2018 at 4:25 PM
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After two strong up days, the Dow, S&P 500, and Nasdaq struggled to pick a direction today, but ultimately ended higher. Although the Dow explored a range of nearly 285 points on both sides of breakeven, it was the index's least volatile session since Jan. 30. While tech and bank stocks rallied, many traders exercised caution ahead of a round of crucial inflation data set for release tomorrow. Specifically, the consumer price index (CPI) could have implications for both bond yields and the Fed. Though Cleveland Fed President Loretta Mester said she doesn't expect inflation to pick up at a pace fast enough to require accelerated rate hikes in 2018, new Fed Chair Jerome Powell said policymakers "will remain alert to any developing risks to financial stability."

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

  • What a rough start for Jerome Powell could mean for stocks, per founder and CEO Bernie Schaeffer.
  • 3 gold stocks that could make big moves this week.
  • An earnings surprise could spark a short squeeze for Groupon stock.
  • Plus, Twitter's crazy options action; another pair of Amazon victims; and 2 healthcare stocks that took a nosedive. 

The Dow Jones Industrial Average (DJI - 24,640.45) ended with a gain of 39.2 points, or 0.2%, for its third straight up day. Cisco Systems (CSCO) led the 14 Dow advancers, adding 1.6% ahead of earnings. DowDuPont (DWDP) paced the losing majority with a 1.5% drop.

The S&P 500 Index (SPX - 2,662.94) added 7 points, or 0.3%, on the day. The Nasdaq Composite (IXIC - 7,013.51) gained 31.6 points, or 0.5%, to end north of 7,000 for the first time since Feb. 7.

The CBOE Volatility Index (VIX - 24.97) gave up 0.6 point, or 2.5%, but found support atop its 10-day moving average.

Closing Indexes Summary Feb 13

NYSE and Nasdaq Stats Feb 13

5 Items on Our Radar Today

  1. President Donald Trump wants to replace roughly half of household food stamp benefits with a domestically grown meal-kit delivery service. The "America's Harvest Box" proposal would impact about 81% of Supplemental Nutrition Assistance Program (SNAP) participants, and is drawing opposition from the grocery industry, where food stamps drive a notable percentage of sales. (CNBC)
  2. An anonymous letter to the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission alleged that the VIX is being rigged by "trading firms with sophisticated algorithms." The VIX whistleblower indicates that the manipulation "has led to multiple billions in profits taken away from ... investors and cashed in by unethical electronic option market makers." (MarketWatch)
  3. Why red-hot Twitter (TWTR) attracted options traders today.
  4. 2 more stocks falling on Amazon (AMZN) fears.
  5. The FTC suit that rocked these healthcare stocks.

Corporate Earnings Feb 13

Unusual Options Activity Feb 13

Data courtesy of Trade-Alert

Oil Prices Dip After IEA Production Warning

While the International Energy Agency (IEA) predicted strong global oil demand in 2018, it also warned that rapid production from the U.S. could counter much of that. As such, March-dated crude futures ended a wishy-washy session down 10 cents, or 0.2%, at $59.19 per barrel.

Gold extended Monday's rally today, once again thanks to a weaker dollar. Gold for April delivery gained $4, or 0.3%, to finish at $1,330.40 an ounce.


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