Day Traders Diary

8/19/20

The major averages finished in the red after the S&P 500 made new all-time highs earlier in the session. The Dow Jones Industrial Average closed down 85 points at 27,692. The S&P 500 fell 0.44% while the Nasdaq Composite dropped 64 points or 0.57%. The markets sold off in the last two hours following the release of the Federal Reserve minutes. Concerns from the Fed officials about the threat posed to the economy by the coronavirus pandemic put investors in the selling mood.

The good news is coronavirus cases in the U.S. are trending lower, but officials are cautious as students begin returning to school and college campuses. Some colleges have been forced to change to all online learning because of outbreaks.

Earlier in the day, the major averages rose as Apple became the first U.S. company to reach a market cap of $2 trillion. With that milestone, Apple officially doubled its valuation in just over two years. In 2020 alone, Apple has surged nearly 60% and was one of the stocks leading the market off its coronavirus lows. The stock was well off its highs in afternoon trading, however, climbing just 0.5%.

Target was another standout up 11% after the retailer reported soaring profit and sales last quarter. Digital sales increased by 197% from a year ago. Lowe's shares gained 0.3% after the home improvement retailer reported a 30% surge in second-quarter revenue.

Wednesday's moves came a day after the S&P 500 broke above its high from Feb. 19 to confirm the start of a new bull market. The Nasdaq Composite also notched a record on Tuesday.

Meanwhile, Treasury Secretary Steven Mnuchin criticized Democratic leaders as unwilling to discuss a smaller relief package on Tuesday; however, Politico reported House Speaker Nancy Pelosi said she is was willing to cut some demands to get an agreement on the bill.

The 2-yr yield was flat at 0.14%, and the 10-yr yield was flat at 0.67%. The U.S. Dollar Index rebounded 0.8% to 92.99, while gold futures pulled back 2.1% to $1970.10/oz. WTI crude futures were flat at $42.90/bbl.