Day Traders Diary

11/7/17

Equities ended Tuesday little changed after heavy losses from financial shares roughly balanced gains in most other areas. The Dow eked out a slim victory--and its fourth consecutive record close--while the S&P 500 finished just a tick below its flat line. The Nasdaq (-0.3%) struggled to keep pace with its peers, but the small-cap Russell 2000 significantly underperformed, plunging 1.3%.

The financial sector tumbled 1.3% amid broad weakness, finishing at the very bottom of the sector standings. Heavyweights like JPMorgan Chase (JPM 98.75, -2.03), Bank of America (BAC 27.18, -0.57), and Wells Fargo (WFC 55.05, -1.13) showed particular weakness, settling with losses of around 2.0% apiece. Today's slide leaves the sector at a fresh two-week low.

Meanwhile, the consumer discretionary sector also struggled on Tuesday, declining by 0.6%. Travel sites Priceline (PCLN 1645.72, -257.28) and TripAdvisor (TRIP 30.35, -9.18) were the sector's worst-performing components, plunging 13.5% and 23.2%, respectively, after Priceline issued disappointing profit guidance for the fourth quarter and TripAdvisor missed Q3 revenue estimates.

Retailers also weighed on the sector, evidenced by the 2.4% decline in the SPDR S&P Retail ETF (XRT 39.00, -0.94)--which finished at a two-month low. There wasn't a single catalyst for the retail slide, but it did follow a Reuters report that some retailers are ordering less merchandise for the holiday season in fear of being stuck with unsold goods at the end.

On a positive note, the consumer staples (+1.1%), utilities (+1.2%), and real estate (+0.9%) sectors finished Tuesday solidly higher. Within the consumer staples space, pharmacy retailers CVS Health (CVS 68.95, +2.15) and Walgreens Boot Alliance (WBA 67.92, +1.98) bounced back from recent weakness, ending with respective gains of 3.2% and 3.0%.

In the bond market, U.S. Treasuries finished mostly higher, with the yield on the benchmark 10-yr Treasury note slipping one basis point to 2.31%.

Elsewhere, WTI crude futures dropped 0.3% to $57.20/bbl after hitting their highest level since July 2015 on Monday. A stronger U.S. dollar worked against the commodity; the U.S. Dollar Index climbed 0.2% to 94.79.

Reviewing Tuesday's economic data, which included the September Job Openings and Labor Turnover Survey (JOLTS) and the September Consumer Credit Report:

• The September Job Openings and Labor Turnover Survey showed that job openings stayed at 6.09 million.
• The Consumer Credit report for September showed an increase of $20.8 billion (Briefing.com consensus +$18.3 billion).

On Wednesday, investors will receive just one economic report--the weekly MBA Mortgage Applications Index--which will be released at 7:00 ET.

• Nasdaq Composite +25.7% YTD
• Dow Jones Industrial Average +19.2% YTD
• S&P 500 +15.7% YTD
• Russell 2000 +9.0% YTD