Day Traders Diary

9/16/19

The major averages pulled back today following an attack on Saudi Arabia oil fields and their largest refinery that caused the price of oil to surge 10%. The Dow Jones Industrial Average slid 142 points, or 0.5% to 27,076. It was the first decline in nine days for the Dow. The S&P 500 pulled back 0.3% to close at 2,997. The Nasdaq Composite dipped 0.3% to 8,153.

West Texas Intermediate futures jumped more than 14%, notching its biggest one-day gain since 2008. The Saudi attacks were at a facility in Abqaiq and the nearby Khurais oil field knocking out 5.7 million barrels of daily crude production or 50% of the kingdom's oil output. Saudi Aramco, the national oil company, reportedly aims to restore about a third of its crude output, or 2 million barrels by Monday. Abqaiq is the world's largest oil processing facility and crude oil stabilization plant with a processing capacity of more than 7 million barrels per day.

President Trump also said the U.S. is "locked and loaded depending on the verification" of the culprit, raising concerns about a military conflict. Secretary of State Mike Pompeo said Iran was behind the attack.

The oil-sensitive energy sector rose 3.3%. Most sectors were lower today with the materials down 1.6%, consumer discretionary down 1.3%, and consumer staples down 1.0%.

Traditional safe-haven assets like U.S. Treasuries and gold finishing higher. The 2-yr yield declined three basis points to 1.76%, and the 10-yr yield declined six basis points to 1.84%. The U.S. Dollar Index advanced 0.4% to 98.61. Gold futures increased 0.8%, or $12.00, to $1511.50/oz.