Day Traders Diary

5/6/20

The Dow Jones Industrial Average and S&P 500 fell for the first time in three days on Wednesday as investors weighed the prospects of reopening the economy along with a dismal report on U.S. payrolls.

The Dow closed 218 points lower, or 0.9%, at 23,664. The Dow reached its session low in the final hour of trading. The S&P 500 slid 0.7% to 2,848. Both indexes were up earlier in the day. However, the Nasdaq Composite rose 0.7% to 8,854 as big tech stocks built on their recent gains.

The fast-spreading coronavirus — which has inflected at least 1.2 million Americans and killed more than 70,000, according to Johns Hopkins University — has seen a leveling off of news cases in the U.S.

Facebook and Netflix rose 0.7% and 2.3%, respectively. Amazon gained 1.4% while Apple closed 1% higher.

Stocks were also under pressure as crude prices fell 2% to snap a five-session winning streak. Those losses led to a 2.6% drop in the S&P 500 energy sector. Occidental Petroleum fell 12.5% while Helmerich and Payne dropped 6.1%.

Separately, earnings standouts today included General Motors up 3%, Activision Blizzard up 6.3% and Beyond Meat up 26%. Walt Disney declined less than the broad market despite suspending its semi-annual dividend.

In the Treasury market, some investors were caught off guard by the amount of longer-dated maturities the Treasury Department planned to issue for COVID-19 relief. The 2-yr yield was unchanged at 0.17%, while the 10-yr yield increased five basis points to 0.71%. The U.S. Dollar Index increased 0.5% to 100.18. WTI crude lost 2.4%, or $0.58, to $23.95/bbl.