Day Traders Diary

7/9/24

The majora averages closed mixed with the S&P 500 climbing to a fresh record Tuesday after Federal Reserve Chair Jerome Powell warned about the dangers of keeping interest rates high for too long. The Dow Jones Industrial Average fell 52 points, or 0.13% to 39,291 with weakness in McDonalds and Microsoft. The S&P 500 rose 4 points while the Nasdaq Composite climbed 25 points or 0.14%.

The yield on the 10-year Treasury rose 2.7 basis points to 4.29% while the 2-year Treasury yield advanced a basis point to 4.62% even in the face of the dovish comments by the Fed chairman. Fed Chairman Powell will continue testimony this week before Congress on Wednesday before the House Financial Services Committee.

Later this the week we will get more key inflation data with the June consumer price index due on Thursday and the producer price index on Friday.

The rally today was in the tech space once again with Nvidia up 2.45% on an upgrade from KeyBanc to hike its price target on the chipmaker to $180, implying upside of 40% from Monday's close. The rest of the chips were quiet with only Intel and Micron modestly higher. Corning continued its rally up 3.7% after raising guidance yesterday.

But not everyone is bullish. Wells Fargo senior global market strategist Sameer Samana warned that stocks are overheating. In a note yesterday, the analyst said the S&P 500 has surged 10.5% from its April 19 lows to July 1, driven by an increasingly narrow group of growth stocks related to artificial intelligence. In the same time period, the S&P 500 equal-weighted index is only up 2.46%.