Day Traders Diary

8/13/24

The major averages surge higher driven by this week's first batch of key U.S. inflation data that came in tamer than expected. The Dow Jones Industrial Average rose 408 points or 1%. The S&P 500 rose 90 points or 1.6% while the Nasdaq Composite rose 407 points or 2.4%.

The producer price index, the measure of wholesale prices, came in at 0.1% last month. Economists expected the reading to show a monthly gain of 0.2% in July, in line with the previous month's reading, according to Dow Jones consensus estimates. This data will not hurt any chances of a rate cut next month. The yield on the 10-year Treasury was lower by 4 basis points to 3.867%. The 2-year Treasury yield fell 4 basis points to 3.969%. Tomorrow is the CPI report.

Earnings were quiet today. Home Depot was the only real blue chip reporting, up a percent on better than expected earnings. Lowes was up in sympathy. A couple stocks, Dell and Nike were both up more than 4% on upgrades.

Tech and chips performed very well today. Nvidia was up 6%. Intel was up 5% while many of the other chip stocks were higher by 2% or more.

On a CEO switch, Starbucks jumped 24% after stealing away the CEO from Chipotle. Chipotle, on the other hand, dropped 7%. Private equity firms have been buying into Starbucks of late to force the company to make some changes. Looks like it's working.

Today's strong rally comes after a steep 7% decline to start August. Today's rally put the S&P 500 within 1.5% of the of where it started the month.

The volatility Index (VIX) has recovered as well jumping from 18 to 64 only to return to 20 in the matter of two weeks.