Day Traders Diary

3/12/13

The major averages finished today's session on a mixed note. The Dow registered a slightly higher close while the S&P 500 and Nasdaq ended in the red. With today's lower close, the S&P 500 has snapped its streak of seven consecutive winning sessions.

After starting the day on a lower note, the key indices attempted to reclaim their losses. However, selling pressure manifested itself shortly thereafter, and drove equities to session lows.

The morning weakness occurred as sellers targeted cyclical stocks. Financials, industrials, and technology led the decline with financials ending as the weakest group.

The financial sector underperformed amid weakness in major bank names. Morgan Stanley (MS 22.67, -0.43) lost 1.9% while the broader SPDR Financial Select Sector ETF (XLF 18.28, -0.10) slipped 0.5%. Notably, the sector led the morning decline after being one of the top performers year-to-date.

The Dow Jones Transportation Average has also acted as one of the leaders of this year's market rally. Since the start of 2013, the bellwether complex has added more than 15.0%. However, the space trailed behind the broader market today, and settled lower by 0.3%.

Transportation-related stocks also weighed on the industrial sector, which ended as one of the weakest performers. The SPDR Industrial Select Sector ETF (XLI 41.72, -0.24) shed 0.6%.

Elsewhere, the technology sector was pressured by some of its largest components. Apple (AAPL 428.43, -9.44), Google (GOOG 827.61, -7.21), and Oracle (ORCL 35.43, -0.45) all lost between 0.9% and 2.2%.

While large cap tech names lagged, there were some areas of strength. Chipmakers fared relatively well and the PHLX Semiconductor Index rose 0.4%.

With the fourth quarter earnings season drawing to a close, only several notable names have yet to report their results. This morning, Costco (COST 103.75, +1.31) beat on earnings and reported revenue in-line with its March 7 pre-announcement. The relative strength of the retailer contributed to the outperformance of the consumer staples sector.

The defensive trade appeared to be favored today as health care and telecoms finished among the day's leaders. In the health care space, Merck (MRK 45.04, +1.38) added 3.2% after a regulatory body voiced its support for Merck to continue one of its clinical trials.

With equities spending the day in the red, the 10-yr note saw steady buying interest in overnight trade with the bid spilling over into the day session. As a result, 10-yr yield slipped four basis points to 2.02%.

After ending yesterday at its lowest level since early 2007, the CBOE Volatility Index (VIX 12.28, +0.72) jumped over 6.0%.

Trading volume was below average as 622 million shares changed hands on the floor of the New York Stock Exchange.

Looking at tomorrow's economic data, the weekly MBA Mortgage Index will be reported at 7:00 ET. February retail sales, retail sales ex-auto, export prices ex-agriculture, and import prices ex-oil will all be announced at 8:30 ET. Finally, January business inventories will be reported at 10:00 ET and the U.S. Treasury will report its February budget at 14:00 ET.

The U.S. Treasury will also reopen $21 billion in 10-yr notes.

All comments contained herein are for informational purposes only, and should not be considered as a solicitation to buy or sell any security. The firm does not guarantee the accuracy or completeness of the information or make any warranties regarding results from it's usage.