Day Traders Diary
The major averages open modestly lower after drifting lower through the day on this holiday-shortened week as September trading kicked into high gear with the price of oil rising nearly $2 or 2%. The Dow Jones Industrial Average fell 195 points or 0.5%. The S&P 500 fell 18 points while the Nasdaq Composite dropped 10 points.
Oil prices rose after Saudi Arabia extended its 1-million-barrels per day voluntary oil production cuts. West Texas Intermediate futures popped more than 1% to trade near $87 per barrel, reaching their highest levels since November.
The uptick in oil pressured airline and cruise stocks, with American Airlines, United Airlines, Delta Air Lines and Carnival shed more than 2%.
Treasury yields also popped, straining risk assets. The yield on the 10-year Treasury surged nearly 9 basis points to 4.262%.
Over the weekend, Goldman Sachs cut its recession odds to 15% and said it anticipates the Federal Reserve will skip a rate hike at its policy meeting later this month.
Last week, however, the Dow and the Nasdaq notched their best performances since July, and the S&P 500 registered its best week since June. Traders last week saw signs of a slowing economy and easing pricing pressures. The latest U.S. nonfarm payrolls report showed the unemployment rate rose to 3.8% in August, reaching its highest level in more than a year. And, in a sign of positive short-term momentum, the major indexes broke above their respective 50-day moving averages this past week.
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