Day Traders Diary

9/30/19

The major averages finished out September on a high note as U.S.-China trade talks wrapped up a volatile third quarter. The Dow Jones Industrial Average finished up 96 points, or 0.4% to close at 26,916. The S&P 500 closed 0.5% higher at 2,976 while the Nasdaq Composite gained 0.8% to 7,999. For the quarter, the Dow and S&P 500 gained more than 1% each while the Nasdaq dipped 0.1%. It was the third straight quarterly gain for the Dow and S&P 500.

In a statement over the weekend, a Treasury spokeswoman said the Trump administration "is not contemplating blocking Chinese companies from listing shares on U.S. stock exchanges at this time." The statement, along with better-than-expected economic data out of China, lifted Wall Street sentiment on Monday.

Tech was among the best-performing sectors in the S&P 500, advancing 1.1% as Apple shares rose 2.4% on a price-target increase by an analyst at J.P. Morgan. The analyst's new price target implies a more-than 20% increase for the tech giant over the next 12 months. The trade-sensitive Philadelphia Semiconductor Index outperformed, with Taiwan Semi up 2% setting a 52-week high after Goldman Sachs added the stock to its Conviction Buy List.

Another decline in oil prices weighed on the oil-sensitive energy stocks, as Saudi Arabia reportedly returned to normal oil output and Chinese data continued to show weakness in the country's manufacturing sector. China's official Manufacturing PMI did improve to 49.8 in September from 49.5 August, but the reading below 50.0 indicated the sector remained in contraction territory. 

The 2-yr yield and the 10-yr yield finished unchanged at 1.62% and 1.68%, respectively. The U.S. Dollar Index increased 0.3% to 99.40. Gold futures, which had rallied alongside a stronger dollar this quarter, declined 2.2% (-$33.10) to $1473.30/ozt.