Day Traders Diary

4/22/17

 The stock market is cruising towards its third consecutive win this afternoon with the major averages holding gains across the board. The tech-heavy Nasdaq (+0.7%) leads the S&P 500 (+0.5%) and the Dow (+0.4%) as tech stocks generally outperform.

Ten of eleven sectors trade in positive territory this afternoon with the technology group (+0.8%) showing relative strength. The tech sector has been underpinned by large-cap names like Alphabet (GOOGL 962.71, +8.06), Microsoft (MSFT 68.24, +0.55), Cisco Systems (CSCO 31.76, +0.55), and Qualcomm (QCOM 59.94, +1.26). Of these four companies, QCOM holds the widest advance, adding 2.2%, after the company's shares were upgraded to 'Overweight' from 'Neutral' at JP Morgan this morning. QCOM's positive performance has rubbed off on its semiconductor peers, evidenced by the 0.7% increase in the PHLX Semiconductor Index.

Like technology, the industrial sector (+0.7%) also trades ahead of the broader market, thanks in part to defense names like Boeing (BA 183.45, +2.71) and Lockheed Martin (LMT 277.17, +4.38). The two names are up 1.5% apiece following a weekend meeting between President Trump and King Salman of Saudi Arabia, which included the signing of a $110 billion arms deal. The utilities sector also outperforms, trading higher by 0.7%.

In U.S. corporate news, Ford Motor (F 11.04, +0.18) officially announced that Jim Hackett will replace Mark Fields as the company's Chief Executive Officer this morning. According to a Wall Street Journal report that was released earlier this month, Ford's Board of Directors has been looking to refine the company's strategy in response to a declining market share and a disappointing stock performance. Ford shares have tumbled around 36.0% since Mr. Fields took over as CEO on July 1, 2014.

Today, Ford trades higher by 1.7%, which makes it one of the consumer discretionary sector's (+0.5%) top-performing components. Amazon (AMZN 969.65, +9.85) has also helped the consumer discretionary space, adding 1.0%, as have retailers, evidenced by the 0.7% increase in the SPDR S&P Retail ETF (XRT 41.42, +0.28). Outside of energy, the remaining sectors trade in positive territory with modest gains between 0.1% (telecom services) and 0.6% (consumer staples).

The energy sector is down 0.1% this afternoon, which is somewhat surprising given crude oil's positive performance. The energy component is up 0.8% at $51.05/bbl as investors display confidence that top oil producers will extend the original OPEC/non-OPEC production cut agreement by six to nine months when they meet in Vienna on Thursday. In addition to pushing back the end date, reports indicate that producers may increase the magnitude of the supply cuts.

In the bond market, U.S. Treasuries trade slightly lower with the benchmark 10-yr yield climbing one basis point to 2.25%. Meanwhile, the U.S. dollar is down 0.2% against the euro (1.1233) after German Chancellor Angela Merkel said the single currency is too weak.

Investors did not receive any economic data on Monday.