Day Traders Diary

11/3/15

The stock market registered its second consecutive gain on Tuesday with the S&P 500 climbing 0.3%. The benchmark index settled a bit behind the Nasdaq Composite (+0.4%) and the Dow Jones Industrial Average (+0.5%) with cyclical sectors pacing the advance.

Equity indices saw modest losses at the start of the trading day, but the market was able to overcome the early weakness thanks to continued leadership from the energy sector as the growth-sensitive group charged higher by 2.5% to extend this week's gain to 5.0%. Today's rally was powered by a 3.8% spike in crude oil, which settled at $47.90/bbl, while top-weighted components like Chevron (CVX 98.14, +3.18) and Exxon Mobil (XOM 86.83, +1.55) posted respective gains of 3.4% and 1.8%.

Similar to energy, most of the remaining cyclical sectors ended the day in positive territory with the influential technology (+0.6%) space showing relative strength. The top-weighted tech sector was underpinned by some of its largest members with Apple (AAPL 122.57, +1.39), IBM (IBM 141.88, +1.51), and Microsoft (MSFT 54.15, +0.91) gaining between 1.1% and 1.7% while Visa (V 77.87, +2.65) surged 3.5% to erase the entirety of yesterday's earnings-driven drop.

Elsewhere among cyclical sectors, the industrial space settled on its flat line as transport stocks lagged. The Dow Jones Transportation Average lost 0.4% with freight carriers struggling. On the earnings front, Expeditors International (EXPD 49.75, -1.05) surrendered 2.1% after reporting a two-cent beat on below-consensus revenue.

Over on the countercyclical side, the utilities sector (+0.3%) settled in-line with the market while health care (-0.3%), telecom services (-0.4%), and consumer staples (-0.5%) lagged throughout the session. The health care sector struggled despite a modest uptick among biotech names, evidenced by a 0.3% gain in iShares Nasdaq Biotechnology ETF (IBB 339.08, +1.02).

That leaves the consumer staples sector (-0.5%), which finished behind the remaining nine groups with Archer-Daniels Midland (ADM 43.15, -3.13) falling 6.8% in reaction to disappointing results.

Today's quiet advance in stocks occurred alongside a modest slide in the bond market with the 10-yr yield rising five basis points to 2.22%.

Investor participation was ahead of average with more than 900 million shares changing hands at the NYSE floor.

Economic data was limited to the Factory Orders report for September, which showed a decrease of 1.0% while the Briefing.com consensus expected a decrease of 0.9%.

The report showed new orders for durable goods declined 1.2%, which was in-line with the advance release in the prior week's Durable Orders report. Excluding transportation, durable goods orders declined 0.6%, which was weaker than the 0.4% decline reported in the advance release.

Tomorrow, the weekly MBA Mortgage Index will be reported at 7:00 ET while October ADP Employment Change (Briefing.com consensus 180,000) and September Trade Balance (consensus -$43.00 billion) will be reported at 8:15 ET and 8:30 ET, respectively. The day's data will be topped off with the 10:00 ET release of the ISM Services report for October (expected 56.6).

Nasdaq Composite +8.6% YTD

S&P 500 +2.5% YTD

Dow Jones Industrial Average +0.5% YTD

Russell 2000 -1.1% YTD