Day Traders Diary

9/23/20

The September correction continues as techs shares slid sharply while Europe struggles with an increase in coronavirus cases. The Dow Jones Industrial Average traded down 525 points or 1.9%. Earlier in the session, the Dow was up 176 points. The S&P 500 slid 78 points or 2.3% while the Nasdaq Composite pulled back 330 points or 3%.

Shares of Amazon dropped 4.1% lead Big Tech lower. Facebook slid 2.4%. Alphabet traded 3.5% lower; Microsoft and Apple were down 3.1%% and 4.2%, respectively.

Shares of Tesla fell 9.2% after Elon Musk offered new delivery predictions for 2020 and detailed a new battery design that he claims will make Tesla's cars cheaper to produce. The stock was also under pressure after Tesla sued the U.S. government to overturn tariffs on China.

The S&P 500 and Dow are down 7.4% and 5.9%, respectively, for the month. The Nasdaq has dropped 9.7% over that time period. Shares of Facebook, Amazon, Apple, Netflix, Alphabet and Microsoft are all down at least 10% in September.

Investors have faced a slew of headwinds this month, including a rising number of global coronavirus cases and uncertainty around further U.S. fiscal stimulus.

Earlier this week, the U.K. said it would impose stricter measures to curb the coronavirus outbreak. To be sure, President Donald Trump said the U.S. would not be implementing a second round of lockdowns. "The U.K. just shut down again. They just announced that they're going to do a shutdown, and we're not going to be doing that," Trump said.

On the stimulus front, lawmakers are still struggling to move forward with a new package. Federal Reserve Chairman Jerome Powell said before Congress on Wednesday that further fiscal stimulus is still needed for the U.S. economic recovery to continue.

Johnson & Johnson bucked the broader market's negative trend, rising 0.6% after the company said it started a phase 3 trial of its coronavirus vaccine.

Nike shares jumped 10% after the company said digital sales surged more than 80% last quarter. Earnings and sales blew past analysts expectations last quarter and the company gave a forecast for growth in the new fiscal year.

Separately, the House passed a government funding bill through Dec. 11 that the Senate is expected to pass later this week. Notwithstanding this piece of good news, general uncertainty surrounding the election, the coronavirus, and the economy likely increased the cash appeal.

U.S. Treasuries, as previously mentioned, finished near their flat lines. The 2-yr yield was unchanged at 0.13%, and the 10-yr yield increased one basis point to 0.68%. WTI crude futures gained 1.0%, or $0.39, to $39.94/bbl but retraced those gains after the settlement time.