From Briefing.com: 4:05 pm : The stock market recorded its second consecutive loss on Thursday, but once again, investor participation was on the light side as some participants decided to sit out the pre-holiday session. The S&P 500 shed 0.2% while the Nasdaq (-0.4%) underperformed. Small caps faced a bit more selling, sending the Russell 2000 lower by 0.9%.
Equity indices were confined to negative territory for the duration of the session with influential sectors responsible for the weakness. The consumer discretionary space (-1.0%) spent the day at the bottom of the leaderboard with Bed Bath & Beyond (BBBY 41.38, -4.18) falling 9.2% after weak results and guidance. Retailers in general had a rough day, sending the SPDR S&P Retail ETF (XRT 44.74, -1.62) lower by 3.5%.
Three other large sectors like financials (-0.3%), technology (-0.3%), and industrials (-0.2%) also spent the day in negative territory. The top-weighted technology space narrowed its weekly gain to 0.5% as losses in large cap components offset gains in chipmakers. The PHLX Semiconductor Index rose 0.5% with Micron (MU 23.19, +2.61) surging 12.7% after beating bottom-line estimates. Staying on the earnings front, software company Red Hat (RHT 68.71, -11.08) reported disappointing billings and revenue, which outweighed above-consensus earnings, sparking a 13.9% dive in the stock.
Only one cyclical sector-energy (+0.5%)-ended in the green, taking a lead from crude oil, which climbed 0.8% to $52.97/bbl. The commodity-sensitive sector will enter Friday with a 0.1% decline for the week.
The countercyclical side had a better showing as telecom services (+1.0%), utilities (+0.3%), and health care (+0.1%) registered gains while consumer staples (-0.1%) and real estate (-0.1%) recorded slim losses.
Treasuries ended the day on a mostly lower note with the 10-yr yield rising one basis point to 2.55%.
Intraday investor participation was below average, but a volume surge into the close lifted the NYSE floor total above yesterday's level of 850 million to more than 875 million.
Economic data included initial claims, the third estimate of Q3 GDP, Durable Orders, FHFA Housing Price Index, Leading Indicators, Personal Income, Personal Spending, and core PCE Prices:
Initial claims for the week ending December 17 increased 21,000 to 275,000 (Briefing.com consensus 256,000)
Continuing claims for the week ending December 10 rose 15,000 to 2.036 million
Q3 GDP was revised up to 3.5% (Briefing.com consensus 3.3%) from 3.2%. The GDP Deflator was left unchanged at 1.4%
Real final sales, which exclude the change in inventories, increased 3.0% versus 2.7% in the second estimate
Durable orders declined 4.6% (Briefing.com consensus -4.5%), with a 73.5% decline in orders for nondefense aircraft and parts acting as the major drag
Excluding transportation, durable orders were up 0.5% (Briefing.com consensus +0.2%)
The FHFA Housing Price Index for October rose 0.4% to follow a 0.6% increase in September
Personal income was little changed in November (Briefing.com consensus 0.3%) after increasing a downwardly revised 0.5% (from 0.6%) in October
Personal spending increased 0.2% (Briefing.com consensus 0.4%) following an upwardly revised 0.4% increase (from 0.3%) in October
The PCE Price Index and the core PCE Price Index, which excludes food and energy, were both unchanged
The Conference Board's Leading Economic Index was unchanged in November (Briefing.com consensus +0.1%) following an unrevised 0.1% increase for October.
Tomorrow's economic data will be limited to the 10:00 ET release of November New Home Sales (Briefing.com consensus 573,000) and the final reading of the Michigan Sentiment Index for December (Briefing.com consensus 98.2).
Russell 2000 +20.1% YTD
Dow Jones Industrial Average +14.3% YTD
S&P 500 +10.6% YTD
Nasdaq Composite +8.8% YTD
DJ30 -23.08 NASDAQ -24.01 SP500 -4.22 NASDAQ Adv/Vol/Dec 1020/1.44 bln/1978 NYSE Adv/Vol/Dec 1242/882.6 mln/1692
3:30 pm :
Crude oil ended pit trading near a 17-month high hit earlier in the week on lighter than avg volume ahead of tomorrow's rig count data
Feb 2017 crude oil futures rose $0.42 (+0.8%) to $52.97/barrel
Baker Hughes rig count data will be released at 1 pm ET tomorrow
Natural gas ended pit trading nearly unchanged after EIA reported a larger-than-expected draw, compared to Consensus
Jan 2017 natural gas closed flat at $3.54/MMBtu
EIA highlights:
Natural gas inventory showed a draw of -209 bcf vs expectations for inventory to be a draw of approximately -201 bcf
Working gas in storage was 3,597 Bcf as of Friday, December 16, 2016, according to EIA estimates
Stocks were 226 Bcf less than last year at this time and 78 Bcf above the five-year avg of 3,519 Bcf
At 3,597 Bcf, total working gas is within the five-year historical range
In precious metals, gold ended nearly flat, silver ended near its lows of the day; the dollar index remained directionless
Feb 2017 gold ended today's session down $2.60 (-0.2%) to $1130.70/oz
Mar 2017 silver closed today's session $0.10 lower (-0.6%) at $15.88/oz
The dollar index was stalling just below its recent 14-year high, nearly flat around the 103.09 level
Commodities, as measured by the Bloomberg Commodity Index, were -0.1% around the 86.33 level
When Thursday's bell rang, the markets were down again. Declining for a second session in a row, the Nasdaq Composite shed 24.01 points (-0.44%) to 5447.42. The S&P 500 was down 4.22 points (-0.19%) to 2260.96, and the Dow Jones Industrial Average lost 23.08 points (-0.12%) to 19918.88.
There were quite a few pieces of economic data today, including the Q3 GDP revision which moved up to 3.5% from 3.2%. The GDP Deflator was left unchanged at 1.4%. Initial claims for the week ending December 17 increased 21,000 to 275,000. Durable orders declined 4.6%, with a 73.5% decline in orders for nondefense aircraft and parts acting as the major drag. Also, the FHFA Housing Price Index for October rose 0.4% to follow a 0.6% increase in September. Personal income was little changed in November after increasing a downwardly revised 0.5% (from 0.6%) in October. And lastly, the Conference Board's Leading Economic Index was unchanged in November following an unrevised 0.1% increase for October.
Technology (XLK 48.92, -0.10 -0.20%) was lower again today. Component Micron (MU 23.19, +2.61 +12.68%) bucked the trend, however, as its Q1 earnings report from last night drove the stock higher today. Other sectors as measured by the S&P closed the session IYZ +1.28%, XLE +0.41%, XLU +0.35%, XLV +0.13%, XLRE -0.13%, XLP -0.15%, XLI -0.19%, XLF -0.25%, XLB -0.42%, XLY -1.08%.
In the S&P 500 Information Technology (819.26, -2.52 -0.31%) sector, trading was soft again today as investors amped up selling in tech names ahead of the holiday. Component Red Hat (RHT 68.71, -11.08 -13.89%) was the worst performer today as its Q3 revenue and billings numbers came in below market expectations last night. Other names in the space which felt the broader market pressure today included TDC -2.27%, CTXS -1.75%, VRSN -1.72%, YHOO -1.66%, FSLR -1.57%, ADSK -1.39%, FB -1.38%, FFIV -1.28%, ATVI -1.25%, GPN -1.19%, FIS -1.16%, PYPL -1.02%.
Other notable news items among sector components:
Nokia (NOK 4.72, -0.04 -0.84%) expanded its patent litigation against Apple (AAPL 116.22, -0.84 -0.72%) in Asia, Europe and the US.
Cleveland Clinic and IBM (IBM 167.06, -0.27 -0.16%) announced a 5-year agreement to expand the Clinic's health information technology capabilities. Financial terms of the deal were not disclosed.
Synopsys (SNPS 59.41, -0.69 -1.15%) said a California Federal District Court has issued a permanent injunction against ATopTech and in favor of Synopsys.
Open Text (OTEX 61.35, -0.68 -1.10%) announced a 2:1 share split; to begin trading ex-split on Jan. 25, 2017.
Glu Mobile (GLUU 2.10, -0.04 -1.87%) acquired substantially all of the intangible assets and certain other assets of Plain Vanilla Corp [QuizUp].
TriNet Group (TNET 26.32, +0.87 +3.42%) announced that Atairos will acquire a $440 million ownership stake in TriNet through the purchase of 17.7 million shares at $25.00 per share from funds affiliated with General Atlantic.
Accenture Federal Services (CAN 117.79, -0.11 -0.09%) was selected to support the Transportation Security Administration's Office of Human Capital in the hiring and recruiting of 8,000 to 10,000 employees a year. The five-year contract, worth up to $290 million.
Renren (RENN 1.71, +0.06 +3.64%) announced the formation of a special committee and receipt of preliminary non-binding spin-off proposal valuing the SpinCo at $500 million net of debt.
In reaction to quarterly results:
Red Hat (RHT) reported better than expected Q3 EPS of $0.61 on worse than expected revenues of $615.3 million and worse than expected billings of $679 million. RHT also gave guidance for Q4 EPS of about $0.61 on worse than expected revenues of $614-622 million.
Micron (MU) reported better than expected Q1 EPS of $0.32 on revenues which came in in-line at $3.97 billion. For Q2, the company sees EPS and revenues better than expected at $0.58-0.68 and $4.35-4.70 billion, respectively.
CalAmp (CAMP 14.31, -1.42 -9.03%) reported worse than expected Q3 EPS of $0.21 on revenues which came in in-line at $83.4 million. For Q4, CAMP sees EPS of $0.25-0.31 on revenues of $84-89 million.
Analyst actions:
MU was upgraded to Buy from Underperform at Needham and to Buy from Hold at Cross Research,
NATI was upgraded to Outperform from Neutral at Robert W. Baird;
RHT was downgraded to Hold from Buy at Stifel and to Market Perform from Outperform at BMO Capital, INVN was downgraded to Hold from Buy at Loop Capital and to Sector Weight from Overweight at Pacific Crest;
MSFT was initiated with an Overweight at Piper Jaffray,
ORCL and PEGA were initiated with Overweight ratings at Mitsubishi UFJ,
RDWR was initiated with a Buy at Jefferies,
AKAM was initiated with a Buy at Guggenheim,
POWI was initiated with a Buy at Drexel Hamilton,
Z was initiated with a Hold at Stifel,
LPTH was initiated with a Buy at Roth Capital
