Day Traders Diary

3/24/15

The stock market registered its second consecutive decline on Tuesday with the S&P 500 retreating 0.6%. The benchmark index ended in-line with the Dow Jones Industrial Average while the Nasdaq Composite (-0.3%) outperformed slightly.

Equity indices traded near their flat lines through the first half of the session before sliding to lows during afternoon action. All ten sectors finished the day in negative territory with technology (-0.3%) registering the slimmest loss.

Also of note, the Dollar Index (97.15, +0.12) was on track for its third consecutive decline, but an early morning rebound following an in-line CPI report (+0.2%) helped the Index finish with a slim gain. Meanwhile, crude oil endured some intraday volatility before settling higher by 0.1% at $47.51/bbl.

Strikingly, crude's flat finish could not stop the energy sector (-0.8%) from ending the day among the laggards. Notably, Whiting Petroleum (WLL 30.91, -7.48) sank 19.5% after pricing a secondary share and note offering.

Elsewhere among influential sectors, financials (-0.9%) and health care (-0.9%) lagged while the remaining groups settled closer to their flat lines.

The top-weighted countercyclical group—health care—slumped during afternoon action after showing early strength that was fueled by biotechnology. The iShares Nasdaq Biotechnology ETF (IBB 355.95, -2.33) was up more than 1.0% in the early going, but settled lower by 0.7% to extend this week's decline to 2.9%.

The afternoon pullback in biotechnology sent the Nasdaq into negative territory, but the index still finished ahead of the broader market thanks to the relative strength among several large cap names. Google (GOOGL 577.54, +12.17) was a clear standout, surging 2.2%, after announcing that Ruth Porat will become the company's new CFO after holding the same position at Morgan Stanley (MS 36.24, -0.07).

Similar to Google, social media names displayed strength with Facebook (FB 85.31, +0.88), LinkedIn (LNKD 264.16, +2.32), and Twitter (TWTR 51.47, +3.01) gaining between 1.0% and 6.2% with Twitter surging to its best level since late October.

In the Treasury market, the 10-yr note spent the bulk of the day near its flat line before spiking to a fresh high in the afternoon. The benchmark yield fell four basis points to 1.87%.

Today's participation was below average with roughly 735 million shares changing hands at the NYSE floor.

Economic data included CPI, FHFA Housing Price Index, and New Home Sales:

The CPI increased 0.2% in February after decreasing 0.7% in January, which is what the Briefing.com consensus expected. 

An uptick in energy prices catalyzed the first monthly increase in consumer prices since October. Energy prices rose 1.0% in February after declining 9.7% in January. A 2.4% increase in gasoline prices was a main contributor to higher energy prices.

Food prices increased 0.2% in February after reporting no change in January.

Excluding food and energy, core CPI increased 0.2% for the second consecutive month while the consensus expected an increase of 0.1%

The FHFA Housing Price Index for January rose 0.3%, which followed a revised increase of 0.7% (from 0.8%) in December

New home sales increased 7.8% in February to 539,000 from an upwardly revised 500,000 (from 481,000) in January while the Briefing.com consensus expected a decline to 465,000 

Higher mortgage rates didn't seem to harm sales as 593,000 new homes were sold, representing the highest rate since February 2008

Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET while the Durable Orders report (Briefing.com consensus 0.4%) will be reported at 8:30 ET.

Nasdaq Composite +5.5% YTD

Russell 2000 +5.0% YTD

S&P 500 +1.6% YTD

Dow Jones Industrial Average +1.1% YTD