Day Traders Diary

8/5/20

The major averages rose once again on the back of strong Disney earnings and coronavirus vaccine hopes. The Dow Jones Industrial Average gained 373 points or 1.3%. The S&P 500 advanced 0.6% and the Nasdaq Composite climbed 0.4% to a record high. Both the Dow and S&P 500 are up for a fourth consecutive daily. The S&P 500 is now only 2% from all-time highs. The Nasdaq rose a six-day winning streak.

Disney earned 8 cents per share, while analysts expected a loss of 64 cents per share. Disney said it now has 100 million paid subscribers across its streaming services, which include Disney+, Hulu and ESPN+. Disney shares popped 8.8%.

Johnson & Johnson announced it struck a $1 billion deal with the U.S. government to manufacture 100 million doses of its coronavirus vaccine candidate if it proves successful. J&J shares rose 0.9%. Novavax shares jumped 9.8% after the company reported phase one vaccine trial results that showed a positive immune response among patients.

Airline stocks rose broadly after Senate Republicans said they supported an additional $25 billion in federal aid for the industry. United Airlines traded 6.4% higher and Delta advanced 4.7%. American Airlines jumped 11.2%.

Laggards were found primarily in the defensive-oriented sectors like utilities, real estate and consumer staples.

On the merger front, shares of Teladoc fell 19% after agreeing to buy Livongo Health in a $18.5 billion cash-and-stock deal.

U.S. Treasuries retraced a bulk of the moves from Tuesday. The 2-yr yield declined one basis point to 0.11%, while the 10-yr yield increased three basis points to 0.54%. The U.S. Dollar Index fell 0.5% to 92.89. WTI crude futures gained 1.2%, or $0.56, to $42.24/bbl, hitting a five-month high in the process.