T3’s Market Wrap: Apple Cracks $1 Trillion Market Cap

Apple (AAPL) saw big-time follow-through from yesterday's earnings reporting, surging to a new record high of $208.38 this afternoon.

This made Apple the first company in history to achieve a $1 trillion market cap.

Congratulations to investors that stayed the course, ignoring all the negative rumors.

Remember this big story from Nikkei “Apple warns suppliers of 20% drop in new iPhone parts orders?”

Turns out that Apple's doing just fine.

And in fact, Apple's early strength essentially forced the market into positive territory today after a negative start.

Tech names like Nvidia (NVDA), Facebook (FB), and Twitter (TWTR) were all weak around the open, but Apple's strength seemed to inspire a big pile-on in tech.

The Nasdaq rose 1.2% and outperformed the S&P 500 by a more than 2:1 ratio, giving the action a ‘risk on' feel, especially since biotechnology and small caps did well.

As you can see on the chart, the S&P put in a nice outside day — opening below yesterday's low before powering above yesterday's high.

The weak open had traders worried about a drop under Monday's 2798 low, but the buyers stabilized the market to avert disaster.

Tesla (TSLA) was another star, pushing up over 10% after reporting earnings. The company missed estimates, but investors were encouraged by CEO Elon Musk's promises of future profitability.

The tech strength had investors forgetting President Trump's push for a 25% tariff on $200 billion worth of Chinese imports.

Perhaps this was best illustrated by the VIX. At its intraday peak, the VIX was up 10.5% at 14.53. But by the equity market close, it nearly hit 12.

That put the 3-month VIX curve at about +3.6. In plain English, this means that traders are pricing in very little volatility for the near-term.

Commodities were mixed, with crude oil rising and gold collapsing.

Speaking of gold, let's take a fresh look at the big picture chart we've been eyeing all year.

As you can see, it appears that gold has fallen out of a wedge formation after repeatedly failing at the upper trendline. It will be interesting to see how traders react around the $1200 levels. I don't place much importance on prime numbers, but it could certainly get some media attention.

And how is sentiment looking these days?

The CNN Fear & Greed index is at 65. F & G operates on a 0-100 scale and 65 indicates moderate fear.

Over in the options market, the CBOE equity put-call ratio has ben above average for the past 4 days, indicating very slight bearishness. The 10 day moving average is 0.645, indicating slight bullishness. So I'd call it neutral.

Meanwhile, the American Association of Individual Investors Sentiment Survey is at 29.1% bullish. This is below the long-term historical average of 38.5%.

So overall, traders look basically neutral at this point.