From Briefing.com: 4:15 pm : The major averages began the week on a modestly lower note as participants preferred a risk-off approach ahead of key economic data and a barrage of corporate earnings reports. The Dow Jones Industrial Average (-0.3%) settled in-line with the S&P 500 (-0.3%) and the Nasdaq Composite (-0.3%). Equity indices and U.S. Treasury yields ticked lower at the beginning of the week as below-consensus economic data and a mixed set of corporate earnings came into focus. Treasuries were in demand following worse than expected readings of the Empire Manufacturing Survey for October and the Industrial Production/Capacity Utilization Report for September.
Treasuries continued inching higher throughout the session, leading to a flattening in the yield curve. The yield on the 2-yr note settled lower by two basis points (0.82%) while the yield on the benchmark 10-yr note finished lower by four basis points (1.77%). The yield spread between the 2-yr and 10-yr narrowed to 95 basis points after finishing last week at 97 basis points.
The downturn in yields offered support to beleaguered "yield play" sectors -- utilities (+0.6%), telecom services (+0.2%), and real estate (+0.1%) -- but also weighed on the heavily-weighted financial group (-0.4%).
Headwinds from a flattening yield curve and weaker-than-expected economic data masked above-consensus results from Charles Schwab (SCHW 31.69, -0.28) and Bank of America (BAC 16.05, +0.05). Meanwhile, Dow component Goldman Sachs (GS 169.00, -1.52) finished behind the price-weighted average ahead of tomorrow morning's quarterly report.
Seven sectors ended in the red with consumer discretionary (-0.8%), energy (-0.4%), consumer staples (-0.4%), and financials (-0.4%) acting as the largest laggards.
In the consumer discretionary space (-0.8%), restaurant names underperformed as Chipotle Mexican Grill (CMG 394.35, -9.79) declined by 2.4%. The stock was under pressure after having its price target lowered to $372 from $405 at Nomura. Meanwhile, Netflix (NFLX 99.80, -1.67) fell 1.7% ahead of this evening's quarterly report. Fellow F.A.N.G. member Amazon (AMZN 812.97, -9.99) also weighed despite receiving a price target increase at Credit Suisse.
The Dow Jones Transportation Average (-0.4%) finished behind the broader market as J.B. Hunt Transport Services (JBHT 78.45, -1.57) displayed relative weakness. The stock fell 2.0% after missing bottom-line estimates for the quarter. Meanwhile, United Continental (UAL 53.03, -0.17) ended lower by 0.3% ahead of this evening's quarterly report.
Health care plan providers underperformed in the health care space (-0.2%) as Anthem (ANTM 118.28, -2.81) fell 2.3%. The stock was downgraded to "Neutral" from "Overweight" at JP Morgan. Biotechnology finished ahead of the broader market, but the iShares Nasdaq Biotechnology ETF (IBB 265.72, -0.36) extended its monthly loss to 8.1%
Today's trading volume fell below the recent average of 859 million as 693 million shares changed hands at the NYSE floor.
Today's economic data included October Empire Manufacturing and the Industrial Production and Capacity Utilization Report for September:
Industrial production increased just 0.1% in September (Briefing.com consensus +0.2%) after declining a downwardly revised 0.5% (from -0.4%) in August.
The capacity utilization rate increased to 75.4% (Briefing.com consensus 75.6%) from a downwardly revised 75.3% (from 75.5%).
The Empire State Manufacturing Survey fell to -6.8 in October (Briefing.com consensus +2.0) from -2.0 in September.
Tomorrow's economic data will include CPI for September (Briefing.com consensus 0.3%) and the NAHB Housing Market Index for October (Briefing.com consensus 59.0), which will cross the wires at 8:30 ET and 10:00 ET, respectively. The day's data will be capped off with the 16:00 ET release of Net Long-Term TIC Flows for August.
Russell 2000: +6.6% YTS
S&P 500: +4.0% YTD
Nasdaq Composite : +3.8% YTD
Dow Jones: +3.8% YTD
DJ30 -51.98 NASDAQ -14.34 SP500 -6.48 NASDAQ Adv/Vol/Dec 1136/1.297 bln/1688 NYSE Adv/Vol/Dec 1188/688.9 mln/1772 3:30 pm :
The dollar index turned negative after a brief re-test of Friday's 7-month high, was -0.2% around the 97.87 level
Commodities, as measured by the Bloomberg Commodity Index, were nearly flat, around the 86.39 level
Crude oil extended Friday's post-rig count slide, ended just shy of $50.00/barrel support ahead of tomorrow's API data
November crude oil futures fell $0.35 (-0.7%) to $49.97/barrel
Reminder: Friday's Baker Hughes rig count data showed that the US oil rig count increased by 4 to 432 rigs, marking the 16th consecutive week the oil rig count has increased.
Data reminders:
Baker Hughes will report weekly rig count data this Friday at 1 pm ET.
The next OPEC meeting will take place in Vienna, Austria on November 30.
Chinese customs is expected to report oil imports & exports from China for September this Friday.
Weekly EIA petroleum data will be released Wed at 10:30 am ET.
API data will be released tomorrow after the bell.
Natural gas doubled Friday's losses, ended near session highs after staging a modest mid-afternoon rally off the $3.21/MMBtu level
November natural gas closed $0.05 lower (-1.5%) at $3.24/MMBtu
Weekly EIA natural gas data will be released Thursday at 10:30 am ET
In precious metals, gold & silver ended nearly flat for the second consecutive session, as the dollar index reversed initial morning gains
December gold ended today's session up $0.80 (+0.1%) to $1256.50/oz
December silver closed today's session $0.01 higher (+0.1%) at $17.47/oz
On very light volume, the broader market turned lower after Friday's modestly higher affair. Leading the way to the downside today, the S&P 500 shed 6.48 points (-0.30%) to 2126.50. The Dow Jones Industrial Average lost 51.98 points (-0.29%) to 18086.40, and the tech-heavy Nasdaq Composite was down 14.34 points (-0.27%) to 5199.82. Heavily weighted S&P components AMZN -1.22%, HD -1.01%, MRK -1.00%, PG -0.68%, JPM -0.52%, PFE -0.49%, WFC -0.47%, V -0.36%, MSFT -0.35% held the index lower today. Today on the NYSE floor, abut 688.9 million shares were exchanged versus an average near 839.8 million. On the NASDAQ floor, about 1,297.4 million shares traded hands compared to an average near 1,589.9 million.
Equity indices and U.S. Treasury yields ticked lower at the beginning of the week as below-consensus economic data and a mixed set of corporate earnings came into focus. Treasuries were in demand following worse than expected readings of the Empire Manufacturing Survey for October and the Industrial Production/Capacity Utilization Report for September.
Treasuries continued inching higher throughout the session, leading to a flattening in the yield curve. The yield on the 2-yr note settled lower by two basis points (0.82%) while the yield on the benchmark 10-yr note finished lower by four basis points (1.77%). The yield spread between the 2-yr and 10-yr narrowed to 95 basis points after finishing last week at 97 basis points.
In terms of economic data announced today, industrial production was up only 0.1% in September after declining a downwardly revised 0.5% (from -0.4%) in August. Also, the capacity utilization rate was up to 75.4% from a downwardly revised 75.3% (from 75.5%). Lastly, the Empire State Manufacturing Survey fell to -6.8 in October from -2.0 in September.
Ending the session near lows, the Technology (XLK 47.27, -0.10 -0.21%) sector was only positive for a brief moment in morning action and tailed off as the session progressed. Component Broadcom (AVGO 168.88, -1.21 -0.71%) was lower today following news out this morning that CFO Anthony Maslowski's employment with AVGO was terminated on October 14; succeeding Maslowski, Thomas Krause became CFO effective October 17. Other sectors as measured by the S&P closed Monday XLY -0.82%, XLFS -0.72%, XLE -0.49%, XLP -0.48%, XLF -0.41%, XLV -0.30%, IYZ -0.25%, XLI -0.24%,XLB +0.09%, XLRE +0.10%, XLU +0.54%.
In the S&P 500 Information Technology (793.90, -2.17 -0.27%) sector, trading finished just off lows. Component IBM (IBM 154.77, +0.32 +0.21%) traded higher into its quarterly print. Other names in the space which ended lower with the sector included HPQ -3.11%, WDC -3.03%, CRM -1.94%, ADS -1.58%, JNPR -1.41%, WU -1.39%, RHT -1.31%, HPE -1.21%, SWKS -1.20%, ACN -1.18%, CSRA -1.15%, FLIR -1.02%.
Other notable news items among sector components:
According to Apple Insider, Apple (AAPL) plans to move $9 billion of iTunes intellectual property to Ireland.
Qualcomm (QCOM) filed actions against Meizu in the United States, Germany and France.
Xilinx (XLNX) announced that Baidu (BIDU) is utilizing Xilinx FPGAs to accelerate machine learning applications in their data centers in China. The two companies are collaborating to further expand volume deployment of FPGA-based accelerated platforms.
Accenture (ACN) has been chosen by Hess (HES) to help realize its As-a-Service vision that is part of the Hess IT transformation strategy.
Following a report from Fortune, shares of Netflix (NFLX) were weak as it was rumored that French lawmakers may support a tax on streaming videos.
Qualcomm's (QCOM) Qualcomm Technologies, Inc., successfully made the world's first over-the-air connection via MulteFire using listen-before-talk (LBT). As part of the test, QCOM demonstrated that
MulteFire can provide LTE-like performance while fairly co-existing with Wi-Fi on the same 5 GHz channel in unlicensed spectrum.
Broadcom's (AVGO) CFO and SVP, Anthony Maslowski's, employment with AVGO was terminated effective October 14, 2016. To that end, the company has appointed Thomas Krause as CFO and VP effective October 17, 2016.
Broadcom (AVGO) introduced the industry's first commercially-available PON OLT devices with support for the recently ratified ITU G.9807.1 XGS-PON and G.989 NGPON-2 protocols.
Hewlett Packard Enterprise (HPE) introduced the HPE Adaptive Backup and Recovery Suite, an integrated suite that uses operational and file analytics to automate and streamline data protection.
Cisco Systems (CSCO) announced the acquisition of Worklife. Financial terms of the deal were not disclosed.
eBay (EBAY) launched eBay Collective, an elevated shopping experience to provide interior designers and consumers with curated inventory of furniture, antiques, contemporary design and fine art.
Elsewhere in the tech space:
In addition to reporting quarterly results, Rogers Comms (RCI) announced the departure of CEO Guy Laurence. Laurence will eventually be replaced by Joseph Natale, but RCI plans to have current Chairman of the Board, Alan Horn, serve in an interim capacity as President and CEO until Natale is able to join RCI.
According to Reuters, Mentor Graphics (MENT) hired an advisor to explore strategic alternatives.
Tesla Motors (TSLA) and Panasonic (PCRFY) to collaborate on photovoltaic cell and module production in Buffalo, New York. Also, TSLA's Elon Musk postponed a Tesla announcement to Wednesday from today, commented it needs a few more days of refinement.
According to reports out during the weekend, Take-Two's (TTWO) Rockstar Games arm teased a possible Red Dead Redemption sequel.
In reaction to quarterly results:
Rogers Comms (RCI) reported worse than expected adjusted EPS of CAD$0.83 on revenues which were ahead of expectations and grew 3.2% compared to last year to CAD$3.49 billion.
Analyst actions:
AMD was upgraded to Perform from Underperform at Oppenheimer,
GRPN was upgraded to Outperform from Neutral at Wedbush,
QLYS was upgraded to Buy from Neutral at DA Davidson;
LLTC was downgraded to Perform from Outperform at Oppenheimer,
P was downgraded to Underperform from Neutral at BofA/Merrill,
DHX was downgraded to Market Perform from Outperform at Avondale;
TTD was initiated at RBC Capital Mkts, Citigroup, Jefferies, Needham, and Raymond James,
TNAV was initiated with an Outperform at FBR & Co.,
ELNK was initiated with an Outperform at Cowen,
CNSL was initiated with a Market Perform at Cowen,
PAY was initiated with a Buy at Craig Hallum,
SHOP was initiated with a Neutral at Dundee,
HCKT was initiated with an Outperform at Barrington Research,
ASUR was initiated with a Buy at Lake Steet
