Day Traders Diary

8-1-24

The major averages took a hit today after opening higher this morning as more earnings keep coming in and the economic data continues to show a slowing economy. The Dow Jones Industrial Average fell 500 points, or 1.2%. The S&P 500 fell 75 points or 1.4% while the Nasdaq Composite dropped 400 points or 2.4%. Even the Russell 2000 index fell 75 points or 3.2%.

On the economic front, the 10-year Treasury fell to 3.997%, reaching its lowest level since Feb. 2 while the 2-year Treasury yield slipped to 4.23% as initial jobless claims rose to 249,000 last week, higher than a Dow Jones forecast of 235,000 while the ISM manufacturing index came in at 46.8%, worse than expected and a signal of economic contraction.

Yesterday, the Federal Reserve chose to keep rates at the highest levels in two decades. Chair Jerome Powell did give some investors hope by signaling a September rate cut is on the table.

On the earnings front, we have a few diamonds. Meta is jumping 4% following strong earnings even as the company spends big on AI. The rest of the big cap techs are in the red.

Shake Shak is jumping 16% after strong earnings that grew 50% while total revenue jumped 16.4% to $316.5 million. Shake Shack opened 12 new stores in the quarter, bringing the total to 18 for the year as the company looks to achieve positive free cash flow for the year for the first time since 2017. Carvana is in nirvana as the stock jumps 6% on earnings. Net income of $48 million came in way ahead of the almost $16 million loss analysts tracked by FactSet had expected. Needham's analyst Chris Pierce raised his price target to $200 a share as the company gains on more traditional car retailing in the U.S.

To the downside, plenty of stocks on earnings. In the tech sector, Qualcomm is down 9%. Arm Holdings is down 17%. Lam Research is down 11% while Western Digital is down 11% as well. Intel is at a 52 week low and reports tonight.  

Gold is the one commodity acting well rising nearly to $2500 per ounce earlier in the session, its best level since July 18^th.