Q2 STOCKS TO BUY

Dow Jones Industrial Average Turns Tail as Yellen Highlights Risks

3 M&A Movers; Plus, the Stock That's Sticking It to Bill Ackman

May 6, 2015 at 11:42 AM
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After a quick pop at the open, the Dow Jones Industrial Average (DJIA) was last seen sharply lower, after Fed Chair Janet Yellen -- in a panel discussion with International Monetary Fund managing director Christine Lagarde -- cautioned against market valuations that are "generally quite high." However, Yellen countered this concern by saying it's a risk the Federal Reserve is keeping an eye on, and they currently do not see signs of a bubble. Meanwhile, Lagarde highlighted the need to "build ...  a financial system that serves society and not the other way around."

Elsewhere, ahead of Friday's always-anticipated nonfarm payrolls report, ADP data showed private-sector employment rose less than expected last month. Additionally, crude oil is extending its quest into year-to-date-high territory, after domestic inventories unexpectedly dropped last week.

 

Continue reading for more on today's market -- and don't miss:

 

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Among the stocks with notable option volume is watch maker Fossil Group Inc (NASDAQ:FOSL), with the contracts crossing the tape at 10 times the average intraday pace. The shares have taken a 10.3% post-earnings tumble to trade at $77.53 -- and earlier touched a two-year low of $76.40 -- and it appears a number of option traders are throwing in the towel on their bullish bets. Specifically, the stock's May 87 call has seen the most action, and it looks as if speculators are selling to close their positions ahead of next Friday's expiration.

 

One of the biggest losers on the Nasdaq is Zulily Inc (NASDAQ:ZU), after the online retailer's dreary forecast and management shake-up was met with a round of bearish brokerage attention. After bottoming at an all-time low of $9.09 out of the gate, ZU was last seen 17% lower at $9.81 -- and on track for its first single-digit settlement to date.

 

Crestwood Equity Partners LP (NYSE:CEQP) is one of the leading laggards on the Big Board, as Wall Street takes a glass-half-empty approach to the company's multi-billion-dollar attempt to simplify it structure. The stock is down 14.5% at $5.71 -- widening its year-to-date loss to 29.5%.

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The CBOE Volatility Index (VIX) is up 0.7 point, or 4.8%, at 15. The market's "fear gauge" has not closed a session north of 15 since April 1.

 

Today's put/call volume ratio on the SPDR S&P 500 ETF Trust (SPY) is 1.60, with puts having a healthy lead over calls. At last check, SPY was off 0.6 point, or 0.3%, at $208.31.

 

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