Day Traders Diary

9/10/18

The S&P 500 advanced for the first time this month on Monday, tacking on 0.2%, in what was a range-bound day of trading on Wall Street. Most S&P sectors climbed, but continued concerns over U.S.-China trade relations kept gains in check. The tech-heavy Nasdaq advanced 0.3%, but the blue-chip Dow underperformed, losing 0.2%.

President Trump still hasn't enacted a $200 billion tranche of tariffs on Chinese goods, but the lingering possibility has kept investors cautious as of late. On a related note, the president told Apple (AAPL 218.33, -2.97) over the weekend that it should manufacture products in the U.S. if it's worried about the impact of tariffs.

Shares of Apple -- the world's largest tech company -- slid for a fourth straight session on Monday, losing 1.3%, which helped to keep the top-weighted information technology sector in check, especially in the morning. However, the group did eventually finish in line with the broader market, closing with a gain of 0.3%.

Conversely, three of eleven sectors finished in the red, including energy (unch), financials (-0.1%), and health care (-0.3%). Within the health care space, shares of UnitedHealth (UNH 259.73, -8.55) and Anthem (ANTM 262.59, -9.31) lost more than 3.0% after being downgraded to 'Neutral' from 'Buy' at Citigroup.

Hurricane Florence, which is headed towards the Carolina coast, strengthened to a Category 4 storm on Monday and is on track to make landfall on Thursday night.

The rapidly intensifying storm gave home improvement retailers, like Home Depot (HD 210.69, +4.46, +2.2%) and Lowe's (LOW 112.39, +2.80, +2.6%), a boost on Monday, but weighed on insurance names, including Progressive (PGR 67.79, -1.08, -1.6%), Travelers (TRV 127.60, -2.49, -1.9%), and Allstate (ALL 97.85, -2.18, -2.2%).

In corporate news, shares of CBS (CBS 55.20, -0.86) slid 1.5% following the departure of chairman and CEO Les Moonves, who stepped down shortly after additional sexual harassment allegations. Tesla (TSLA 285.50, +22.26) shares rallied though, adding 8.5%, after CEO Elon Musk told employees that the company is "...about to have the most amazing quarter in our history."

Looking at other markets, U.S. Treasuries were flat on Monday, with the benchmark 10-yr yield closing unchanged at 2.94%, and the U.S. Dollar Index slid 0.3% to 95.13. The dollar was particularly weak against the pound (-0.9%) after the EU's chief Brexit negotiator, Michael Barnier, said a deal is possible by early November.

Reviewing Monday's economic data, which was limited to the Consumer Credit report for July:

• The Consumer Credit report for July showed an increase of $16.6 billion (Briefing.com consensus $14.5 billion). June credit growth was revised to $8.5 billion from $10.2 billion.
  • The key takeaway from the report is that the credit expansion in July was driven almost entirely by nonrevolving credit.

Looking ahead, investors will receive the August NFIB Small Business Optimism Index, the July Job Openings and Labor Turnover Survey, and July Wholesale Inventories on Tuesday.

• Nasdaq Composite +14.8% YTD
• Russell 2000 +11.9% YTD
• S&P 500 +7.6% YTD
• Dow Jones Industrial Average +4.6% YTD

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• Headlines provided by Briefing.com