Nasdaq Drops Triple Digits as Tech Sector Slumps

A positive Amazon earnings reaction couldn't save the broader market

Jul 27, 2018 at 4:29 PM
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The U.S. stock market started the day in positive territory as traders cheered the biggest gross domestic product (GDP) reading in four years. However, this enthusiasm waned as the trading day wore on amid pressure from sinking tech and energy stocks. While massive post-earnings drops for Intel (INTC) and Exxon Mobil (XOM) sent the Dow swinging lower, the chipmaker's whiff had the Nasdaq slumping to a triple-digit loss. Plus, Twitter's brow-raising sell-off weighed on the S&P 500 -- and offset a positive earnings reaction for Amazon (AMZN), which pushed the FAANG name's market cap north of $900 billion.

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

  • Caterpillar options traders bet on another earnings upside move.
  • The sinking cloud stock at risk for more downgrades.
  • Plus, a "big short" on Tesla; Chipotle's new high; and commodities fall with stocks.

The Dow Jones Industrial Average (DJI - 25,451.06) explored a 210-point range on both sides of breakeven, eventually closing down 76 points, or 0.3%. Seventeen Dow components settled in negative territory, led by INTC's 8.6% plunge. Chevron (CVX), Walgreens Boots Alliance (WBA), and Verizon (VZ) paced the 13 advancers, each rising 1.6%. For the week, the Dow added 1.6%.

The S&P 500 Index (SPX - 2,818.82) erased an early lead to give back 18.6 points, or 0.7%, while the Nasdaq Composite (IXIC - 7,737.42) shed 114.8 points, or 1.5%. On a weekly basis, the SPX gained 0.6%, while the IXIC slumped 1.1%.

The Cboe Volatility Index (VIX - 13.03) rose 0.9 point, or 7.3%. Week-over-week, the market's "fear gauge" edged up 1.3%.

Closing Indexes July 27

NYSE and Nasdaq July 27

5 Items on Our Radar Today

  1. Fears of a potential trade war weighed on consumer sentiment in July, per the University of Michigan. The consumer sentiment index fell to 97.9 this month from June's reading of 98.2 -- still higher than analysts were expecting -- and remains well off its 14-year high of 101.4 from March. (CNBC)
  2. Helios and Matheson Analytics (HMNY) said Thursday's MoviePass service outage was due to a lack of cash to pay for movie tickets, while a Securities and Exchange Commission (SEC) filing revealed the firm borrowed an emergency $5 million to pay vendors. Shares of HMNY plunged 70%, and hit a record low in intraday action. (CNN Money)
  3. Steve Eisman said he's short Tesla stock ahead of the carmaker's earnings report.
  4. Strong same-store sales sent Chipotle to a new high -- and left analysts scrambling to catch up.
  5. A discounted share offering sent this drug stock to a record low.

Corporate Earnings Chart July 27

Unusual Options Volume July 27

Data courtesy of Trade-Alert

Oil, Gold End in the Red

Oil prices slumped after data showed the number of active domestic oil rigs edged higher last week. September-dated crude fell 92 cents, or 1.3%, to settle at $68.69 per barrel. Comparing most active contracts, crude oil surrendered 2.5% week over week, but September-dated futures edged up 0.6% from last Friday's settlement.

Gold prices edged lower following this morning's GDP data. Gold for August delivery closed down $2.70, or 0.2%, at $1,223 an ounce. For the week, gold gave back 0.7%, marking its third consecutive weekly loss.


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