From Briefing.com: 4:12 pm Closing Market Summary: Cyclical Sectors Lead Stocks Higher (:WRAPX) : The stock market began the week on a higher note with the Nasdaq Composite (+1.0%) showing relative strength on Monday. The tech-heavy index settled ahead of the S&P 500 (+0.6%), but both marked their highs during the initial hour, spending the afternoon inside narrow ranges.
Equity indices enjoyed an upbeat start, rising alongside European stocks, even though the results of the constitutional reform referendum in Italy will invite political uncertainty going forward. On Sunday, Italian citizens voted 59-41 to reject a proposal that would have reformed the country's Senate. Prime Minister Matteo Renzi offered his resignation, but Italian President Sergio Mattarella reportedly asked Mr. Renzi to delay his departure until after the approval of a budget for 2017. It is currently unclear what impact the results of the referendum will have on rescue plans for Banca Monte dei Paschi di Siena.
Italian stocks erased the bulk of their losses by the close while European sovereign debt retreated with Italy's 10-yr yield spiking nine basis points to 2.00%.
U.S. Treasuries also faced selling during the European session, but trends reversed shortly after focus shifted to the North American session. Treasuries spent the day in a slow climb off their lows with the 10-yr note ending flat. The benchmark yield settled at 2.39% while selling in the 2-yr note pushed up its yield two basis points to 1.12%.
Five of six cyclical sectors displayed relative strength from the start, which kept the benchmark index well above its flat line throughout the day. Sectors like financials (+1.2%) and consumer discretionary (+1.0%) rebounded from Friday's underperformance while energy (+0.7%) posted a solid gain even though crude oil reversed into the close. The energy component surrendered a 1.0% gain to settle higher by 0.2% at $51.79/bbl. Oil continued sliding in electronic trade and showed a 1.1% decline ($51.10/bbl) as the stock market closed for the day. The late afternoon decline unfolded even though the U.S. Dollar Index (100.13, -0.64) fell 0.6%.
The top-weighted technology sector (+1.0%) also had a strong showing with chipmakers displaying broad strength that sent the PHLX Semiconductor Index higher by 1.2%. This contributed to the relative strength in the Nasdaq Composite while biotechnology provided another measure of support, but the iShares Nasdaq Biotechnology ETF (IBB 271.93, +1.47) narrowed its gain to 0.5% by the close. Biotech names fared better than the health care sector, which shed 0.2%.
Like health care, the industrial space (-0.1%) lagged throughout the day, keeping the S&P 500 below its opening high. Dow components Caterpillar (CAT 94.45, -0.69) and General Electric (GE 31.11, -0.23) weighed, falling near 0.7% apiece. Airlines also pressured the sector with Alaska Air (ALK 83.12, -1.71) and Southwest Airlines (LUV 47.07, -0.84) ending with respective losses of 2.0% and 1.8%. Other transport stocks held up better, sending the Dow Jones Transportation Average higher by 0.4%.
Today's participation was just below average as 915 million shares changed hands at the NYSE floor.
Economic data was limited to ISM Services:
The ISM Services Index rose to 57.2 in November from 54.8 in October while the Briefing.com consensus expected an increase to 55.6
This report marked a 12-month high for the series, reaching levels from October 2015
Tomorrow, Q3 Productivity (Briefing.com consensus 3.3%), Unit Labor Costs (Briefing.com consensus 0.2%), and October Trade Balance (Briefing.com consensus -$41.80 billion) will be released at 8:30 ET while October Factory Orders (Briefing.com consensus 2.5%) will cross the wires at 10:00 ET.
Russell 2000 +17.7% YTD Dow Jones Industrial Average +10.3% YTD S&P 500 +7.9% YTDNasdaq Composite +6.0% YTDOpening the week, the broader market managed to hold onto some strong gains. Leading the action higher today, the Nasdaq Composite added 53.24 points (+1.01%) to 5308.89. The S&P 500 was up 12.76 points (+0.58%) when the bell rang to 2204.71. The Dow Jones Industrial Average rounded out the bunch up 45.82 points (+0.24%) to 19216.24. Strong Nasdaq 100 components PCAR +3.7%, TSLA +2.9%, INCY +2.7%, AMZN +2.6% and MAR +2.3% all aided the broader market advance.
Equity indices enjoyed an upbeat start, rising alongside European stocks, even though the results of the constitutional reform referendum in Italy will invite political uncertainty going forward. On Sunday, Italian citizens voted 59-41 to reject a proposal that would have reformed the country's Senate. Prime Minister Matteo Renzi offered his resignation, but Italian President Sergio Mattarella reportedly asked Mr. Renzi to delay his departure until after the approval of a budget for 2017. It is currently unclear what impact the results of the referendum will have on rescue plans for Banca Monte dei Paschi di Siena.
Italian stocks erased the bulk of their losses by the close while European sovereign debt retreated with Italy's 10-yr yield spiking nine basis points to 2.00%.
U.S. Treasuries also faced selling during the European session, but trends reversed shortly after focus shifted to the North American session. Treasuries spent the day in a slow climb off their lows with the 10-yr note ending flat. The benchmark yield settled at 2.39% while selling in the 2-yr note pushed up its yield two basis points to 1.12%.
For its part, crude oil reversed morning gains. The energy component surrendered a 1.0% gain to settle higher by 0.2% at $51.79/bbl. Oil continued sliding in electronic trade and showed a 1.1% decline ($51.10/bbl) as the stock market closed for the day. The late afternoon decline unfolded even though the U.S. Dollar Index (100.13, -0.64) fell 0.6%.
Lastly, market data today was limited to the ISM Services Index rose to 57.2 in November from 54.8 in October.
The Technology (XLK 47.14, +0.45 +0.96%) space finished on the right side of flat lines today after losing about -1.4% last week. Component First Solar (FSLR 32.35, +2.20 +7.30%) was higher today as a BBC article highlighted an upcoming meeting between President-elect Donald Trump and Al Gore to discuss climate change. Other sectors as measured by the S&P closed out Monday XLFS +2.19%, IYZ +1.22%, XLF +1.19%, XLY +1.01%, XLE +0.88%, XLRE +0.80%, XLB +0.78%, XLU +0.13%, XLP +0.12%, XLI -0.08%, XLV -0.18%.
In the S&P 500 Information Technology (789.15, +8.08 +1.03%) space, trading ended just off highs, up more than +1%. Component Citrix Systems (CTXS 88.99, +3.37 +3.94%) was among the better performers today as the stock was upgraded to a Buy rating at Mizuho ahead of the open. Other names in the space which showed relative strength included NVDA +3.88%, QRVO +3.84%, SYMC +3.57%, CRM +3.49%, TDC +2.95%, HPQ +2.84%, TEL +2.68%, MA +2.42%, GPN +2.35%, ADBE +2.23%, ATVI +2.16%, RHT +2.16%, ADS +2.14%.
Other notable news items in the space:
Aixtron (AIXG 4.12, +0.15 +3.78%) and Grand Chip Investment confirmed US Presidential order prohibiting acquisition of the U.S. business.
CACI Intl (CACI 131.85, +1.95 +1.50%) was awarded a $1.77 billion task order to support Joint Improvised-Threat Defeat Organization.
Fairpoint Comms (FRP 18.85, +1.85 +10.88%) to be acquired by Consolidated Communications (CNSL 27.21, -1.17 -4.12%) in an all-stock merger transaction valued at about $1.5 billion.
Canadian Solar (CSIQ 11.79, +0.72 +6.50%) announced that it has closed JPY14.9 billion (US$141.5 million) senior and subordinate non-recourse term loan facilities to finance the construction and operation of a 55 MWp solar power plant in the Yamaguchi prefecture, Japan.
AT&T (T 38.63, +0.02 +0.05%) was informed that it is a bidder within the "competitive range" by the First Responder Network. Based on Rivada's court filing and pdvWireless' (PDVW 23.25, +0.15 +0.65%) public statements, AT&T is not aware of any other bidders who remain within the "competitive range" of the First Responder Network procurement. Should AT&T's bid be accepted, we look forward to serving the public safety community through this contract and making a significant investment in the infrastructure of our country. The actual reach of the network and necessary investment will be determined by the election to participate by the individual States.
Also, according to AT&T (T), the company in a partnership with Intel (INTC 34.39, +0.23 +0.67%) and Ericssson (ERIC 5.29, +0.13 +2.62%) began 5G business customer trials.
Shopify (SHOP 40.57, +1.52 +3.89%) acquired digital product studio Tiny Hearts. Financial terms of the deal were not disclosed.
CGI Group (GIB 46.97, -0.14 -0.30%) announced it intends to purchase for cancellation Class A subordinate voting shares under a specific share repurchase program.
Analyst actions:
CTXS was upgraded to Buy from Neutral at Mizuho,
TRIP was upgraded to Hold from Sell at Stifel,
V was upgraded to Buy from Neutral at Guggenheim,
QTNA was upgraded to Strong Buy from Buy at Needham;
MRVL was downgraded to Sell from Neutral at Goldman,
ANET was downgraded to Equal Weight from Overweight at Morgan Stanley,
MELI was downgraded to Neutral from Positive at Susquehanna,
CNSL was downgraded to Hold from Buy at Drexel Hamilton;
HPE was initiated with a Buy at Gabelli & Co.
