From Briefing.com: 4:10 pm : The stock market ended the midweek affair on a mixed note as investors favored a cautious approach ahead of a plethora of economic data and the latest policy statement from the Bank of England. The Nasdaq Composite (+0.4%) ended ahead of both the S&P 500 (-0.1%) and the Dow Jones Industrial Average (-0.2%).
Equity indices gyrated at the start of the session as investors continued to mull a recent resurgence of volatility and a downturn in crude oil futures. The energy component was under pressure as participants responded to a mixed reading of the American Petroleum Institute's weekly inventory report. The API reported that crude oil stockpiles rose by 1.4 million barrels (last: -12.0 million barrels) while gasoline inventories fell by 2.4 million barrels (last: -2.40 million barrels).
The broader market shook early weakness in the opening hour as investors looked to confirm the inventory reading with the Department of Energy's more influential stockpile data. The EIA reported that crude oil inventories declined by 0.55 million barrels (consensus: +3.80 million) after falling 14.51 million barrels in the prior week. Meanwhile, gasoline inventories increased by 0.56 million barrels (consensus: +0.34 million). WTI crude initially spiked on the news, but was unable to maintain position above the $45.00/bbl price level. Crude oil ended its day near its low, sliding 3.0% ($43.58/bbl; -$1.34).
The S&P 500 (-0.1%) moved lower with crude oil, but managed to stay in positive territory amid strength in the top-weighted technology sector (+0.4%). The benchmark index carved out a session low in the final hour of trade as seven sectors finished in the red. The consumer staples (-0.3%), financial (-0.3%), and energy (-1.2%) sectors ended at the bottom of the leaderboard while consumer discretionary (UNCH), utilities (+0.5%) and technology (+0.6%) led.
The influential technology sector (+0.6%) outperformed as Dow component Apple (AAPL 111.83, +3.88) rallied 3.6%. The name displayed relative strength as bullish pre-order data for the iPhone 7 elicited a bid for the second session in a row. The PHLX Semiconductor Index (+0.9%) also outperformed as iPhone suppliers led. Broadcom (AVGO 169.61, +4.37) and Skyworks (SWKS 72.40, +3.04) finished at the top of the index, gaining 2.6% and 4.4%, respectively.
In the health care space (-0.1%), biotechnology outperformed amid recent M&A news. Allergan (AGN 244.81, +4.71) rallied 2.0% after announcing that it would acquire Vitae Pharmaceuticals (VTAE 20.85, +12.75) for $21 per share in cash. Allergan also benefited from a bullish note from Mizuho. Conversely, McKesson (MCK 167.70, -8.14) fell 4.6% after the Department of Justice requested more information regarding the company's contribution and sale agreement with Change Healthcare.
In the financial sector (-0.3%), Wells Fargo (WFC 46.52, -0.44) erased a modest gain after reports indicated that California and New York may investigate the bank for its sales tactics. Separately, Dow component American Express (AXP 63.48, -0.88) finished at the bottom of the price-weighted index. The financial sector has declined 1.0% this week, leading only materials (-0.2%; week-to-date: -1.2%) and energy (-1.2%; week-to-date: -3.1%).
Treasuries ended higher with the short end of the curve demonstrating relative strength. The yield on the 2-yr note fell four basis points to 0.76% while the yield on the 10-yr note declined three basis points to 1.70%.
Today's participation was above the recent average as more than 878 million shares changed hands on the NYSE floor.
Today's economic data was limited to the weekly MBA Mortgage Index and Import/Export Prices for August:
The MBA Mortgage Index showed that mortgage applications increased 4.2% in the week ending September 10. This followed a 0.9% gain in the prior week.
Lower prices for agricultural and nonagricultural exports led a 0.8% decline in export prices in August while lower fuel prices paced a 0.2% decline in import prices.
Excluding agriculture, export prices declined 0.4% after increasing a revised 0.2% (from +0.3%) in July.
Excluding fuel, import prices were unchanged after increasing an unrevised 0.3% in July.
Tomorrow's economic data will include weekly initial claims (Briefing.com consensus 263k), Retail Sales for August (Briefing.com consensus -0.1%), PPI for August (Briefing.com consensus +0.1%), the Philadelphia Fed Survey for September (Briefing.com consensus 0.0), the second quarter Current Account Balance (Briefing.com consensus -$122.8 billion), and Empire Manufacturing for September (Briefing.com consensus 0.0) each crossing the wires at 8:30 ET. Separately, Industrial Production (Briefing.com consensus -0.3%) and Capacity Utilization (Briefing.com consensus 75.7%) for August will be released at 9:15 ET while Business Inventories for July (Briefing.com consensus +0.1%) will cross the wires at 10:00 ET.
Russell 2000: +6.7% YTD
S&P 500: +4.0% YTD
Dow Jones: +3.5% YTD
Nasdaq: +3.3% YTD
DJ30 -32.29 NASDAQ +18.52 SP500 -1.19 NASDAQ Adv/Vol/Dec 1408/1.734 bln/1428 NYSE Adv/Vol/Dec 1420/878.1 mln/1566
3:30 pm :
The dollar index extended this morning's decline, -0.3% around the 95.33 level
Commodities, as measured by the Bloomberg Commodity Index, were -0.4% around the 82.69 level
Crude ended a volatile session at fresh session lows, extended yesterday's post-IEA decline following mixed EIA data
October crude oil futures fell $1.34 (-3.0%) to $43.58/barrel
EIA highlights:
Crude oil inventories had a draw of -0.559 mln (consensus called for a build of +3.80 mln barrels)
Gasoline inventories had a build of +0.567 mln (consensus called for a build of +0.34 mln barrels)
Distillate inventories had a build of +4.619 mln
Data reminders:
Baker Hughes rig count data will be released Friday at 1 pm ET
The next OPEC meeting will take place in Algiers, Algeria from Sept 26-28
Natural gas ended pit trading slightly in the red after a session of sideways trading ahead of tomorrow's inventory data
October natural gas closed $0.02 lower (-0.7%) at $2.89/MMBtu
Weekly EIA natural gas data will be released tomorrow at 10:30 am ET
In precious metals, gold & silver reversed yesterday's losses as the dollar index headed lower
December gold ended today's session up $2.00 (+0.2%) to $1326.00/oz
December silver closed today's session $0.09 higher (+0.5%) at $19.07/oz
Base metal copper found direction in afternoon pit trading after 5 consecutive sessions of trading nearly flat
December copper closed $0.05 higher (+2.4%) at $2.15/lb
The major averages began the day on a choppy note as participants assessed the chances of a rebound following yesterday's retreat. Global bourses settled on a mostly lower note as investors favored a cautious approach ahead of tomorrow's policy statement from the Bank of England. Meanwhile, falling interest rates relieved some persistent rate angst as sovereign bonds retraced a portion of yesterday's rout.
Crude oil contributed to early weakness, erasing a modest overnight gain ahead of today's session. The energy component was under pressure following a mixed reading of the American Petroleum Institute's weekly inventory report. However, equities and crude oil shrugged off the reading in the opening hour as participants looked ahead to the Department of Energy's more influential inventory report. The EIA reported that crude oil stockpiles fell by 0.55 million barrels (consensus: +3.80 million) while gasoline inventories rose by 0.56 million barrels (consensus: 0.34 million). The energy component carved out a new low shortly thereafter. As it were, October crude oil futures ended down $0.74 (-1.6%) around the $44.15/barrel level.
Rebounding off yesterday's weakness, the broader market was in the green for the majority of the session but ultimately ended mixed. The lone out-performer today was the Nasdaq Composite which added 18.52 points (+0.36%) to 5173.77. The Dow Jones Industrial Average shed 31.98 points (-0.18%) to end 18034.77, and the S&P 500 was down 1.25 points (-0.06%) to 2125.77.
Leading the day in positive territory, the Technology (XLK 46.81, +0.22 +0.47%) sector pared gains in late trading yet still finished firmly in the green. Component Apple (AAPL 111.83, +3.88 +3.59%) posted fresh YTD highs today following positive commentary to start the week and in recent news today was the subject of a few conference calls regarding iPhone pre-order levels at AT&T (T 39.89, -0.08 -0.20%) and Verizon (VZ 51.49, +0.04 +0.08%). Other sectors as measured by the S&P ended today mixed XLU +0.39%, XLY +0.01%, IYZ +0.00%, XLV -0.04%, XLI -0.09%, XLB -0.23%, XLF -0.29%, XLP -0.30%, XLFS -0.79%, XLE -1.10%.
In the S&P 500 Information Technology (781.35, +4.48 +0.58%) sector, trading was modestly lower off highs of the day, but strength held on. Component Cognizant Tech (CTSH 54.03 -0.97 -1.76%) was among the worst performers today following a premarket downgrade at CLSA to an Underperform rating from Outperform. Other names in the space which ended lower included TSS -1.45%, FLIR -1.20%, IBM -1.13%, FISV -0.96%, MSI -0.81%, WDC -0.73%, MA -0.68%, ACN -0.66%, XRX -0.61%.
Other notable news items among sector components:
The Finnish Funding Agency for Innovation and IBM (IBM 154.05, -1.76 -1.13%) announced a partnership that will enable Finland to utilize Watson cognitive computing to help doctors improve the health of its citizens, and strengthen and develop the Finnish innovation and business ecosystem in the fields of health and well-being. To facilitate the collaboration, IBM intends to establish a Watson Health Center of Excellence in Finland, the first Nordic Healthcare Competence Center, and the first National Imaging Center of Excellence outside the United States in Finland. These centers are expected to employ 150 people over the next few years.
Activision Blizzard (ATVI 43.66, +0.25 +0.58%) announced a private transaction to offer senior unsecured notes in two series.\
Cisco Systems (CSCO 31.00, -0.06 -0.19%) priced $6.25 billion of Senior Unsecured Notes in 5 separate tranches.
NVIDIA (NVDA 60.40, +0.53 +0.89%) priced $2.0 billion notes offering consisting of $1.0 billion of 2.20% notes due 2021 and $1.0 billion of 3.20% notes due 2026.
CloudCraze, an enterprise digital commerce solution built natively on Salesforce (CRM 73.82, +0.76 +1.04%), was selected as the commerce platform for Repsol (REPYY 13.33, -0.19 -1.41%). This strategic initiative will provide Repsol, specifically its Chemicals Division, with a solution to enable B2B commerce on the cloud.
Elsewhere in the tech space:
Liberty Global plc (LBTYA 32.12, -0.31 -0.96%) revealed a multi-year partnership with Netflix (NFLX 97.01, +0.92 +0.96%) which will lead to Netflix's content being made available to Liberty Global video customers across more than 30 countries around the world.
Zebra Tech (ZBRA 65.12, -1.06 -1.60%) sold its wireless LAN business to Extreme Networks (EXTR 4.01, +0.26 +6.93%) for $55 million in cash.
SAP AG's (SAP 88.32, +0.17 +0.19%) Concur to acquire travel search company Hipmunk. The transaction is expected to close in October 2016.
IMS Health (IMS 30.03, +0.17 +0.57%) announced the pricing of its offering of $1.75 billion equivalent in gross proceeds of senior notes, consisting of $1.05 billion of U.S. Dollar notes and 625 million of Euro notes to be issued by its wholly owned subsidiary, IMS Health Incorporated. The offering was upsized from the previously announced $1.5 billion equivalent aggregate principal amount. The net proceeds from the notes offering will primarily be used to extinguish certain of the issuer's and Quintiles' (Q 77.90, +0.37 +0.48%) existing indebtedness in connection with the previously announced proposed merger between IMS Health and Quintiles.
Amdocs (DOX 59.00, -1.52 -2.51%) announced the acquisition of three privately owned companies for about $260 million. The acquisitions are expected to contribute 1.5% to 2.0% to total company revenue for FY17.
ADTRAN (ADTN 18.15, -0.06 -0.33%) acquired key fiber access products, technologies and service relationships from subsidiaries of CommScope (COMM 29.50, +0.09 +0.31%). Financial terms of the deal were not disclosed.
Glu Mobile (GLUU 2.18, -0.09 -3.96%) acquired Poke Radar for $500,000 in cash.
SolarCity (SCTY 16.89, -0.17 -1.00%) issued a statement on joint agreement to grandfather 32,000 Nevadans. The company urged the Public Utilities Commissioners to ratify agreement to customers and all Nevada solar customers as soon as possible.
Amazon (AMZN 761.09, +0.08 +0.01%) announced that Alexa, Echo, and the all-new Echo Dot are now available for customers in the UK and Germany.
Cellcom Israel (CEL 7.61, +0.03 +0.40%) announced that a purported class action was filed against 013 Netvision Ltd., the company's wholly owned subsidiary, and two other Israeli international calls operators, alleging that the defendants unlawfully charge random customers with excessive and unreasonable prices for outgoing calls from Israel.
In reaction to quarterly results:
FFIV was upgraded to Outperform from Perform at Oppenheimer,
ISIL was upgraded to Neutral from Sell at Citigroup;
ISIL was downgraded to Hold at Deutsche Bank and to Neutral at B. Riley & Co.,
CTSH was downgraded to Underperform from Outperform at CLSA,
APIC was downgraded to Neutral from Overweight at JP Morgan;
GRPN was initiated with a Hold at Loop Capital,
VG was initiated with an Outperform at Robert W. Baird
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