Day Traders Diary

10/3/19

The major averages went on a rollercoaster ride following weak economic data. The weakest ISM Non-Manufacturing number since August 2016 sent the Dow down over 300 points and down 1100 points in three days before recovering in the afternoon. The Dow Jones Industrial Average finished up 122 points or 0.5% at 26,201. The S&P 500 gained 0.8% to 2,910 while the Nasdaq Composite jumped 1.1% to 7,872. Tech stocks led the rebound with Facebook up 2.7% as fellow "FANG" stock such as Alphabet and Amazon gained 1% and 0.7%, respectively. Apple closed 0.9% higher.

All 11 S&P 500 sectors rallied off their lows and finished in the green. The energy rose 1.3%, information technology rose 1.2%, and real estate rose 1.2%. The Philadelphia Semiconductor Index finished up 1.7%. The financials squeezed out a last-minute gain, even as Treasury yields continued to decline.

The 2-yr yield dropped ten basis points to 1.38%, and the 10-yr yield dropped seven basis points to 1.53%. The U.S. Dollar Index declined 0.1% to 98.90. WTI crude lost 0.5%, or $0.20, to $52.4/bbl.

The yield on the fed-funds sensitive 2-yr note fell to its lowest level since September 2017, as expectations for additional rate cuts continued to increase.

In Corporate news included Facebook announced a camera-first messaging app, named Threads, for its Instagram platform. Shares of Snap dropped 3.4% in response. PepsiCo rose 3% after reported positive earnings results. Constellation Brands declined 6.1% following earnings while Tesla dropped 4.2% after reporting record third quarter deliveries but missed estimates.