Day Traders Diary


 The major averages began the trading week on a cautious note with the Dow (-0.7%), Nasdaq (-0.8%), and S&P 500 (-0.7%) registering comparable losses.


Equity indices retreated through the first two hours of the trading day and the lack of intraday bargain hunting kept the key averages near their lows into the afternoon. The S&P 500 erased a third of its advance from Friday, but managed to settle above its 200-day moving average (2,065).


Cyclical sectors were at the forefront of today's retreat with energy (-3.7%) diving to the bottom of the leaderboard at the start of the trading day. The growth-sensitive group accelerated its slide during the late morning as crude oil cracked a new low for the year, dipping beneath the $38.00/bbl mark. The energy component settled lower by 5.9% at $37.63/bbl after sliding from its overnight high near $39.75/bbl.


Similarly, the other commodity-related sector—materials (-1.8%)—also settled well behind the broader market while other cyclical groups posted slimmer losses. For instance, the industrial sector (-0.4%) ended ahead of the S&P 500 with airlines contributing to the relative strength. Delta Air Lines (DAL 51.78, +2.00) was a standout performer, spiking 4.0%, but the Dow Jones Transportation Average (-0.9%) settled behind the S&P 500 as losses in most DJTA components overshadowed gains in airline names.


Likewise, the consumer discretionary sector (-0.5%) ended ahead of the broader market with restaurant names showing general strength, which masked a 1.7% drop in the shares of Chipotle Mexican Grill (CMG 551.75, -9.45) after the company forecast a decline in Q4 comparable sales stemming from the recent E. coli incident. Furthermore, the stock was downgraded at Cowen and Guggenheim following the guidance update.


Meanwhile, the consumer staples sector (+0.3%) held a modest gain throughout the day, largely thanks to a 72.0% surge in Keurig Green Mountain (GMCR 88.89, +37.19) after the company agreed to be acquired by an investor group led by JAB Holding Company for $92/share, which translates to roughly $13.90 billion.


Similar to consumer staples, utilities (+0.3%) and telecom services (+0.6%) posted gains while the fourth countercyclical sector—health care (-0.6%)—could not make it out of the red.


Treasuries climbed throughout the morning to end the day near their highs with the 10-yr yield down four basis points at 2.23%.


Today's retreat invited above-average participation with more than 925 million shares changing hands at the NYSE floor.


Economic data was limited to the Consumer Credit report which showed a $16.00 billion increase in October, bolstered almost entirely by a $15.80 billion increase in nonrevolving credit. The consensus estimate expected consumer credit to increase by $18.60 billion. The change in September consumer credit was revised slightly lower to $28.50 billion from $28.90 billion.


Tomorrow's data will be limited to the October Job Openings and Labor Turnover Survey, which will be released at 10:00 ET.


Nasdaq Composite +7.7% YTD

S&P 500 +0.9% YTD

Dow Jones Industrial Average -0.5% YTD

Russell 2000 -3.0% YTD

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