Day Traders Diary

11/25/20

The major averages took a breather today after reaching a significant milestone, Dow 30,000 yesterday. The Dow Jones Industrial Average slid 173 points, or 0.58%. The S&P 500 declined 5 points or 0.16% while the Nasdaq Composite rose 57 points or 0.48%. Trading volumes were lighter than usual ahead of the Thanksgiving holiday.

The Labor Department said that 778,000 people filed for unemployment benefits for the first time last week. Economists polled by Dow Jones expected initial jobless claims to come in at 733,000.

Salesforce led the Dow lower, falling more than 3% after Dow Jones reported the company held talks to buy Slack Technologies. CNBC later confirmed the report. Shares of Slack popped more than 25%. Energy fell 1.7% and was the worst-performing sector in the S&P 500.

The Dow broke above 30,000 for the first time on Tuesday, rallying more than 400 points. The Dow is on pace for its biggest monthly gain since 1987, up more than 12%.

Small caps were also coming off a record high, with the Russell 2000 surging nearly 2% on Tuesday. For the month, the Russell is up around 20%, which would be its best-ever monthly performance. On Wednesday, however, the small-cap benchmark dipped 0.4%. The S&P 500, meanwhile, posted an all-time closing high on Tuesday, rising 1.6%.

The market's rally to record highs comes amid positive vaccine news coupled with increasing political clarity.

Earlier this week, AstraZeneca said an early analysis showed its vaccine candidate had an average efficacy of 70%. Meanwhile, the Trump administration made federal resources available to President-elect Joe Biden's team for his transition into office. Traders have also cheered the prospects of former Federal Reserve Chair Janet Yellen potentially being nominated for Treasury secretary.

U.S. Treasuries finished little changed in a lackluster session. The 2-yr yield was flat at 0.16%, and the 10-yr yield was flat at 0.88%. The U.S. Dollar Index decreased 0.3% to 91.96. WTI crude futures rose 1.9%, or $0.83, to $45.72/bbl.