Day Traders Diary

10/29/19

The major averages closed modestly lower after the S&P 500 closed at a record high on Monday. The broad index closed 0.1% lower at 3,036, snapping a four-day winning streak. Earlier in the session, however, the S&P 500 gained as much as 0.3% to hit an all-time high of 3,047. The Dow Jones Industrial Average closed 19.30 points lower at 27,071. The Nasdaq was the weakest of the major averages down 49 points or 0.59%.  

Plenty of earnings still coming in. In the drug space, Pfizer and Merck both jumped over 2.5% following better than expected results. In the oil space, Conoco Phillips jumped 2.5% on earnings. Other notable earnings include General Motors up 4.3%, Kellogg rose 3%, Xerox was up 11.7% and Ingersoll-Rand jumped 4.7%.

 Data from FactSet shows 78% of the S&P 500 companies that have reported thus far beat analyst expectations.

To the downside, two recent highflyers. Beyond Meat (BYND) fell 22% despite beating top and bottom-line estimates and guiding 2019 revenue above consensus. Beyond Meat's lockup for insiders expired today. Shares traded eight times their normal volume. GrubHub is down 43% after missing top and bottom-line estimates and guiding fourth quarter revenue below consensus. Business has been affected by changing dynamics in the food delivery sector with increase competition from Uber Eats, DoorDash and Postmate. One analyst downgraded it to Underperform from Outperform lowering his target to $34 from $91. Thanks for nothing.

Investors are also increasing bets that at least a partial trade deal between China and the U.S. will be signed next month.

The U.S. central bank is largely expected to lower interest rates by 25 basis points. That would be the third time this year the Fed cuts rates. However, investors will also look for clues about the Fed's policy decisions in the future.

U.S. Treasuries crept higher in an equally lackluster session. The 2-yr yield and the 10-yr yield both declined one basis point to 1.64% and 1.84%, respectively. The U.S. Dollar Index declined 0.1% to 97.69. WTI crude declined 0.3%, or $0.19, to $55.76/bbl.