Sector Investing

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 32944.19 -229.88 (-0.69%)
Nasdaq 12843.81 -286.15 (-2.18%)
SP 500 4204.31 -55.21 (-1.30%)
10-yr Note -1/32 2.007
NYSE Adv 819 Dec 2359 Vol 1.0 bln
Nasdaq Adv 1306 Dec 3070 Vol 5.2 bln

Industry Watch
Strong: Utilities
Weak: Communication Services, Consumer Discretionary, Information Technology

Moving the Market

-- Investors grow frustrated with the market and economy

-- President Putin reportedly describes a positive shift in talks with Ukraine, but market doesn't believe him

-- Higher oil prices, flatter Treasury yield curve

-- Consumer sentiment declines in March

Stocks close at session lows in frustrating session
11-Mar-22 16:20 ET
Dow -229.88 at 32944.19, Nasdaq -286.15 at 12843.81, S&P -55.21 at 4204.31

[BRIEFING.COM] The S&P 500 fell 1.3% on Friday, as investors appeared frustrated with the state of the market and economy. The Nasdaq Composite (-2.2%) and Russell 2000 (-1.6%) lost more than 1.5% while the Dow Jones Industrial Average lost 0.7%.

All 11 S&P 500 sectors closed in negative territory, leaving the benchmark index at session lows after it started the day with a 0.7% gain. The information technology (-1.8%), consumer discretionary (-1.8%), and communication services (-1.9%) fell nearly 2.0% while the utilities sector decreased just 0.4%.

The positive start transpired after President Putin reportedly described a positive shift in talks with Ukraine, but the problem for the market was that no one earnestly believed Mr. Putin was going to stop the invasion without a full surrender from Ukraine. On a related note, President Biden announced new economic actions against Russia in coordination with allies.

Other issues included higher oil prices ($109.10/bbl, +2.81, +2.6%) following a suspension in nuclear deal talks between the U.S. and Iran, a flatter Treasury yield curve, a decline in consumer sentiment for March, disappointing guidance from DocuSign (DOCU 75.01, -18.87, -20.1%) and Rivian (RIVN 38.05, -3.11, -7.6%), and continued weakness in Chinese ADRs.

DocuSign and Rivian, specifically, reminded investors that there's still room for further downside in the growth stocks should they not meet expectations. Oracle (ORCL 77.82, +1.17, +1.5%), meanwhile, stood out after providing upbeat revenue guidance.

The mega-caps were a heavy drag on the market. The Vanguard Mega Cap Growth ETF (MGK 210.96, -4.30) fell 2.0%, versus a 1.1% decline for the Invesco S&P 500 Equal Weight ETF (RSP 149.52, -1.59).

Strikingly, the Treasury market wasn't as excited as the stock market initially was following the Putin headline. It was relatively quiet, and the ensuing price action signaled concerns that the inflationary environment could lead the Fed to an aggressive rate-hike path and slow down growth even more.

The 2-yr yield increased three basis points to 1.75% while the 10-yr yield declined one basis point to 2.00%. The U.S. Dollar Index rose 0.6% to 99.11.

Reviewing Friday's economic data:

The preliminary March reading for the University of Michigan Consumer Sentiment Index checked in at 59.7 (Briefing.com consensus 62.5) versus the final reading of 62.8 for February. The March reading marks the lowest level for the index since October 2012.
The key takeaway from the report is that rising inflation is eating away at consumer sentiment, as consumers recognize their purchasing power has been reduced because their income is not keeping up with inflation. That is apt to translate into reduced discretionary spending activity. Notably, it was indicated in the report that personal finances were expected to worsen in the year ahead by the largest proportion since the survey started in the mid-1940s.

There is no economic data of note scheduled for Monday.

Dow Jones Industrial Average -9.3% YTD
S&P 500 -11.8% YTD
Russell 2000 -11.8% YTD
Nasdaq Composite -17.9% YTD

Crude futures settle above $109 per barrel
11-Mar-22 15:30 ET
Dow -84.49 at 33089.58, Nasdaq -216.18 at 12913.78, S&P -34.73 at 4224.79

[BRIEFING.COM] The S&P 500 is down 0.8% while the Nasdaq (-1.6%) and Russell 2000 (-1.1%) continue to underperform.

One last look at the sectors shows information technology (-1.2%), consumer discretionary (-1.3%), and communication services (-1.4%) lagging with declines over 1.0%. The utilities sector outperforms near its flat line.

WTI crude futures settled higher by $2.81 (+2.6%) to $109.10/barrel.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 33174.07 -112.18 (-0.34%)
Nasdaq 13129.96 -125.58 (-0.95%)
SP 500 4259.52 -18.36 (-0.43%)
10-yr Note -27/32 2.006
NYSE Adv 1312 Dec 1855 Vol 1.0 bln
Nasdaq Adv 1742 Dec 2600 Vol 5.0 bln

Industry Watch
Strong: Energy, Consumer Discretionary, Utilities, Real Estate
Weak: Information Technology, Financials, Consumer Staples, Communication Services

Moving the Market

-- Stocks close off lows as oil prices cough up gains

-- Russia and Ukraine end talks without any real progress

-- CPI data for February was as hot as expected

-- 10-yr yield tops 2.00%

-- Amazon.com (AMZN) announces 20-for-1 stock split and $10 billion share repurchase program

Optimism gets reined in, but stocks close off lows
10-Mar-22 16:20 ET
Dow -112.18 at 33174.07, Nasdaq -125.58 at 13129.96, S&P -18.36 at 4259.52

[BRIEFING.COM] The S&P 500 declined 0.4% on Thursday, although it was down as much as 1.6% intraday amid concerns surrounding the macro environment. The Dow Jones Industrial Average (-0.3%) and Russell 2000 (-0.2%) also fell modestly while the Nasdaq Composite (-1.0%) underperformed.

Yesterday's optimism was pressured by a breakdown in ceasefire talks between Russia and Ukraine, CPI data for February that was as hot as feared/expected, a 10-yr yield that reached 2.01% (+6 bps today), and a short rebound in oil prices after the UAE clarified that it wasn't going to unilaterally raise oil production.

Fortunately, oil prices went from over $114.00/bbl intraday to below $107.00/bbl ($106.29, -2.59, -2.4%) by the settlement. That seemed to help lighten the mood for the stock market, even as interest rates held firm.

The S&P 500 sectors closed mixed with six sectors closing lower and five sectors closing higher. The heavily-weighted information technology sector (-1.8%) fell about 2%, while the energy (+3.1%) and consumer discretionary (+1.2%) sectors rose 3% and 1%, respectively.

Interestingly, energy stocks bounced back from yesterday's pullback despite the fade in oil prices, which played a constructive role for the consumer discretionary stocks.

The consumer discretionary sector, to be fair, really owed a large part of its outperformance to Amazon.com (AMZN 2936.35, +150.77, +5.4%), which jumped 5% after announcing a 20-for-1 stock split and a $10 billion share repurchase authorization.

The other mega-caps were not as fortunate, evident by the 0.8% decline in the Vanguard Mega Cap Growth ETF (MGK 215.26, -1.71, -0.8%). The Invesco S&P 500 Equal Weight ETF (RSP 151.11, -0.29, -0.2%), for comparison, decreased by 0.2%.

Specifying the consumer inflation data, total CPI rose 0.8% m/m in February while core CPI, which excludes food and energy, rose 0.5% m/m. Both were in-line with expectations. The year-over-year rates increased to 7.9% and 6.4%, respectively.

The report tugged on inflationary fears and supported rate-hike expectations. The fed-funds sensitive 2-yr yield rose five basis points to 1.72%. The U.S. Dollar Index rose 0.6% to 98.57 amid relative weakness in the euro, which fell 0.9% against the dollar to 1.098.

Reviewing Thursday's economic data:

Total CPI increased 0.8% month-over-month in February, as expected, while core CPI, which excludes food and energy, increased 0.5%, also as expected. On a year-over-year basis, total CPI was up 7.9%, versus 7.5% in January, and core CPI was up 6.4%, versus 6.0% in January.
The key takeaway from the report is that inflation is still terribly high and going higher given the worsening commodity price trends seen this month and increased rent costs. Accordingly, this report should bring nothing but cold comfort.
The weekly initial claims report showed an 11,000 increase in jobless claims to 227,000 (Briefing.com consensus 220,000) for the week ending March 5. Continuing claims for the week ending February 26 increased by 25,000 to 1.494 million.
The key takeaway from the report is that the level of jobless claims is still consistent with a tight labor market.
The Treasury Budget showed a $216.6 bln deficit in February versus a $310.9 bln deficit in the same period a year ago. The budget data is not seasonally adjusted, so the February deficit cannot be compared to the January surplus of $118.7 bln.
The budget deficit over the last 12 months is $2.20 trln versus a deficit of $2.30 trln in January.

Looking ahead, investors will receive the preliminary University of Michigan Index of Consumer Sentiment for March on Friday.

Dow Jones Industrial Average -8.7% YTD
Russell 2000 -10.4% YTD
S&P 500 -10.6% YTD
Nasdaq Composite -16.1% YTD

Crude futures extend yesterday's decline
10-Mar-22 15:30 ET
Dow -181.01 at 33105.24, Nasdaq -143.91 at 13111.63, S&P -27.96 at 4249.92

[BRIEFING.COM] The S&P 500 is down 0.6%, and the Russell 2000 is down 0.7%.

One last look at the sectors shows information technology (-2.0%) exerting key pressure on the market, as it trades lower by 2% amid weakness in Apple (AAPL 157.93, -5.02, -3.1%) and the semiconductor stocks. The Philadelphia Semiconductor Index is down 2.3%.

Conversely, the energy sector is up 3.2%, the consumer discretionary sector is up 1.2%, and the utilities sector is up 0.5%.

WTI crude futures settled lower by $2.59 (-2.4%) to $106.29/bbl.

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Market Snapshot

briefing.com

Dow 33285.65 +653.01 (2.00%)
Nasdaq 13255.54 +459.99 (3.59%)
SP 500 4277.89 +107.19 (2.57%)
10-yr Note -29/32 1.925

NYSE Adv 2553 Dec 814 Vol 1.2 bln
Nasdaq Adv 3275 Dec 1029 Vol 5.3 bln


Industry Watch
Strong: Financials, Information Technology, Consumer Discretionary, Communication Services, Materials

Weak: Energy, Utilities


Moving the Market
-- Stocks rally as oil prices drop 12%

-- Hopeful-sounding rhetoric from Russia and Ukraine in front of ceasefire talks tomorrow

-- UAE supports OPEC to increase production; U.S. officials reportedly want Venezuela to increase oil exports to U.S. in exchange for ease in sanctions





Rebound rally fueled by drop in oil prices
09-Mar-22 16:20 ET

Dow +653.01 at 33285.65, Nasdaq +459.99 at 13255.54, S&P +107.19 at 4277.89
[BRIEFING.COM] The S&P 500 rallied 2.6% on Wednesday, as buy-the-dip efforts were emboldened by a 12% drop in oil prices ($108.88, -14.88, -12.0%). The Nasdaq Composite gained 3.6%, the Russell 2000 gained 2.7%, and the Dow Jones Industrial Average gained 2.0%.

The pullback in oil was due to a confluence of factors, including hopeful-sounding rhetoric from Russia and Ukraine in front of ceasefire talks tomorrow, the UAE vouching support for OPEC to increase production, and news that U.S. officials want Venezuela to increase oil exports to the States in exchange for an ease in sanctions.

A 12% decline for a commodity that is still up 45% for the year was the type of drawdown needed to revive risk sentiment, even if the macro environment was still inflationary. It's too early to know if oil peaked for the near term, but there was hope that consumers could start to see relatively lower prices at the gas pump.

Stocks that were hit the hardest this month were among the biggest gainers today, particularly those in the S&P 500 information technology (+4.0%), financials (+3.6%), communication services (+3.5%), and consumer discretionary (+2.9%) sectors.

The energy sector (-3.2%), on the other hand, fell 3% amid the weaker oil prices while the utilities sector (-0.8%) was the only other sector that closed lower. Both sectors remained higher for month, so there was likely some profit-taking activity in the groups.

Bumble (BMBL 23.64, +6.98, +41.9%) was an individual standout, with shares soaring 42% on better-than-feared earnings results.

Besides the scope of today's gains, the risk-on mindset was corroborated by declines in the CBOE Volatility Index (32.45, -2.68, -7.6%), the U.S. Dollar Index (98.00, -1.06, -1.1%.), gold prices ($1987.20, -60.10, -2.9%), and Treasury prices.

To be fair, Treasuries might have been pressured by an acknowledgement that one trading day doesn't remove inflationary pressures and that the Fed is still on track to hike rates multiple times this year, starting next week. On a related note, the $34 billion 10-yr Treasury note auction received lukewarm demand.

The 2-yr yield increased four basis points to 1.67%, and the 10-yr yield increased eight basis points to 1.95%.

Reviewing Wednesday's economic data:

Job openings decreased to 11.263 million in January from a revised record-high of 11.448 million (from 10.925 million) in December.
The weekly MBA Mortgage Applications Index rose 8.5% following a 0.7% decline in the prior week.

Looking ahead, investors will receive the Consumer Price Index for February, the weekly Initial and Continuing Claims report, and the Treasury Budget for February on Thursday.

Dow Jones Industrial Average -8.4% YTD
S&P 500 -10.3% YTD
Russell 2000 -10.0% YTD
Nasdaq Composite -15.3% YTD



Crude futures fall 12%
09-Mar-22 15:30 ET

Dow +757.51 at 33390.15, Nasdaq +479.85 at 13275.40, S&P +120.82 at 4291.52
[BRIEFING.COM] The S&P 500 continues to trade at session highs with a 2.9% in what's been a relatively calm rally.

One last look at the sectors shows nine sectors up more than 1.0%, including the financials (+4.2%) and information technology (+4.2%) sectors with gains over 4.0%. The energy sector is down 3.4% due to the drop in oil, while the utilities sector trades flat.

WTI crude futures settled lower by $14.88 (-12.0%) to $108.88/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 32632.64 -184.74 (-0.56%)
Nasdaq 12795.55 -35.41 (-0.28%)
SP 500 4170.70 -30.39 (-0.72%)
10-yr Note -7/32 1.842
NYSE Adv 1595 Dec 1572 Vol 1.5 bln
Nasdaq Adv 2057 Dec 2113 Vol 6.6 bln

Industry Watch
Strong: Energy, Consumer Discretionary
Weak: Health Care, Utilities, Consumer Staples

Moving the Market

-- Volatile session for stocks

-- U.S. bans energy imports from Russia

-- Reports indicate Ukraine no longer insists on NATO membership and that Putin will ban certain raw material exports until Dec. 31

-- Treasury yields rise amid inflation, rate-hike expectations

Large-cap indices close lower in volatile session
08-Mar-22 16:15 ET
Dow -184.74 at 32632.64, Nasdaq -35.41 at 12795.55, S&P -30.39 at 4170.70

[BRIEFING.COM] The S&P 500 lost 0.7% on Tuesday in a volatile session driven by geopolitical headlines. The Nasdaq Composite (-0.3%) and Dow Jones Industrial Average (-0.6%) joined the benchmark index in negative territory, while the Russell 2000 (+0.6%) closed higher.

Nine of the 11 S&P 500 sectors closed lower, including the defensive-oriented consume staples (-2.6%), health care (-2.1%), and utilities (-1.6%) sectors at the bottom of the standings. The energy (+1.4%) and consumer discretionary (+0.1%) sectors closed higher.

The stock market struggled out of the gate, as oil prices flirted with $130 per barrel in anticipation for the U.S. to ban energy imports from Russia. On a related note, the UK and EU said they would phase out their Russian energy imports this year, but the UK said it was still exploring options for a ban on gas imports.

Soon after President Biden announced the ban, stocks carved out a bottom and then rallied to session highs amid a report indicating that Ukraine was no longer insisting on NATO membership.

The S&P 500 went from a 0.7% intraday decline to a 1.8% intraday gain. Crude futures pared gains and settled at $123.76/bbl (+$4.49, +3.8%).

The rally off the lows was likely driven by short-covering activity from investors caught off guard by the market's sell-the-rumor, buy-the-fact response. Unfortunately, the gains didn't last long because the market turned negative after reports indicated that President Putin was going to ban the export of products and raw materials from the Russian Federation until Dec. 31.

The volatile price action frustrated investors, but at least the Treasury market communicated a more consistent message through its steady rise in yields. Namely, the Russia-Ukraine situation is expected to exacerbate inflation pressures via supply chain disruptions and, in turn, force the Fed to react with tighter monetary policy.

The 2-yr yield rose nine basis points to 1.63%, and the 10-yr yield rose 12 basis points to 1.87%. The U.S. Dollar Index decreased 0.2% to 99.06.

For what it's worth, nickel prices soared at the London Metal Exchange (LME) on Tuesday, more than doubling at one point to exceed $100,000 per metric ton. While that gain was pared some, the LME suspended trading for the rest of the day.

Reviewing Tuesday's economic data:

The trade deficit widened in January to $89.7 billion (Briefing.com consensus -$87.5 billion) from a downwardly revised $82.0 billion (from -$80.7 billion). Exports were $3.9 billion less than December exports and imports were $3.8 billion more than December imports.
The key takeaway from the report is that it marked the third straight month of a widening deficit, underscoring weakening trade activity related to the Omicron variant and ongoing supply chain disruptions. In the same period a year ago, the trade deficit was $65.1 billion.
Wholesale inventories increased 0.8% in January, as expected, following a revised 2.6% increase (from 2.2%) in December.
The NFIB Small Business Optimism Index for February decreased to 95.7 from 97.1 in January.

Looking ahead, investors will receive the JOLTS - Job Openings report for January and the weekly MBA Mortgage Applications Index on Wednesday.

Dow Jones Industrial Average -10.2% YTD
S&P 500 -12.5% YTD
Russell 2000 -12.6% YTD
Nasdaq Composite -18.2% YTD

Crude futures settle near $124 per barrel
08-Mar-22 15:30 ET
Dow +67.83 at 32885.21, Nasdaq +75.78 at 12906.74, S&P +3.37 at 4204.46

[BRIEFING.COM] The S&P 500 is up 0.1%, but the Russell 2000 continues to shine with a 1.9% gain.

One last look at the sectors shows energy (+1.6%) as the only sector up more than 1.0%, while the consumer staples (-2.0%), health care (-1.2%), utilities (-1.2%), and real estate (-0.2%) sectors trade lower.

WTI crude futures settled higher by 3.8%, or $4.49, to $123.76/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 32817.38 -797.42 (-2.37%)
Nasdaq 12830.96 -482.48 (-3.62%)
SP 500 4201.09 -127.78 (-2.95%)
10-yr Note -25/32 1.771
NYSE Adv 658 Dec 2554 Vol 1.4 bln
Nasdaq Adv 1208 Dec 2759 Vol 6.1 bln

Industry Watch
Strong: Energy, Utilities
Weak: Consumer Discretionary, Information Technology, Communication Services, Financials, Materials

Moving the Market

-- Higher oil prices fuel slowdown concerns

-- Oil prices hit $130 per barrel last night as U.S. and allies discuss ban on Russian oil imports, but settle just below $120 per barrel

-- Foreign ministers of Russia and Ukraine agree to meet on Thursday, Germany opposes ban on Russian energy imports

Stocks drop as higher oil fuels slowdown concerns
07-Mar-22 16:20 ET
Dow -797.42 at 32817.38, Nasdaq -482.48 at 12830.96, S&P -127.78 at 4201.09

[BRIEFING.COM] The S&P 500 dropped 3.0% on Monday, as investors remained concerned about the Russia-Ukraine situation and an accompanying increase in oil prices ($119.27, +4.00, +3.5%). The Nasdaq Composite underperformed with a 3.6% decline while the Dow Jones Industrial Average (-2.4%) and Russell 2000 (-2.5%) fell closer to 2.5%.

The session started on a flattish note, overcoming a 2% drop in the futures market, as oil prices went from $130/bbl on Sunday evening to below $120/bbl prior to the open.

The initial spike in oil (+12%) was catalyzed by news that the U.S. and allies were discussing a ban on oil imports from Russia. The retracement coincided with news that the foreign ministers of Russia and Ukraine agreed to meet on Thursday and that Germany was holding a softer stance regarding the ban proposal.

Notwithstanding the intraday ease in oil, the fact that prices were still high exacerbated concerns about a slowdown in consumer spending due to people spending more at the gas pump. The weak price momentum in stocks was another cause for concern.

The underperformance of the S&P 500 consumer discretionary sector, which fell 4.8%, corroborated the consumer slowdown narrative. Likewise, the U.S. Global Jets ETF (JETS 16.91, -2.12, -11.1%) fell 11%, and Uber (UBER 28.57, -1.26, -4.2%) fell 4% despite raising its Q1 Adjusted EBITDA guidance range.

Like last week, the mega-caps were not a place to hide out, presumably because of cash-raising efforts amid expectations for further weakness. The Vanguard Mega Cap Growth ETF (MGK 209.69, -8.88) fell 4.1%, versus a 2.8% decline for the Invesco S&P 500 Equal Weight ETF (RSP 149.33, -4.25).

On the upside, the energy (+1.6%) and utilities (+1.3%) sectors each rose more than 1.0%.

The former was an obvious beneficiary of higher oil prices. The latter received support from NextEra Energy (NEE 84.18, +3.97, +5.0%), which was upgraded to Overweight from Sector Weight at KeyBanc Capital Markets on the view that the company will benefit from increased clean-energy initiatives.

Treasury yields also finished on a higher note, a byproduct of cash-raising efforts as demand for Treasuries decreased. The 2-yr yield increased five basis points to 1.54%, and the 10-yr yield increased three basis points to 1.75%. The U.S. Dollar Index rose 0.5% to 99.15.

Reviewing Monday's economic data:

Consumer credit increased by $6.8 billion in January (Briefing.com consensus $25.0 billion). The prior month saw an upward revision to $22.4 bln from $18.9 bln.
The key takeaway from the report is that there was a notable deceleration in credit expansion in January, as Omicron issues and rising interest rates came into play. Revolving credit saw its first contraction since April 2021.

Looking ahead, investors will receive the Trade Balance for January, the NFIB Small Business Optimism Index for February, and Wholesale Inventories for January on Tuesday.

Dow Jones Industrial Average -9.7% YTD
S&P 500 -11.9% YTD
Russell 2000 -13.1% YTD
Nasdaq Composite -18.0% YTD

Crude futures settle near $120 per barrel
07-Mar-22 15:30 ET
Dow -658.06 at 32956.74, Nasdaq -396.45 at 12916.99, S&P -107.84 at 4221.03

[BRIEFING.COM] The S&P 500 is down 2.5% and could close at its lowest level since last June.

One last look at the sectors shows consumer discretionary (-4.3%), financials (-3.1%), communication services (-3.0%), and materials (-3.0%) down between 3-4%, while the energy (+1.1%) and utilities (+1.1%) sectors both trade higher by 1.1%.

WTI crude futures settled higher by $4.00 (+3.5%) to $119.27/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 33614.80 -179.86 (-0.53%)
Nasdaq 13313.44 -224.50 (-1.66%)
SP 500 4328.87 -34.62 (-0.79%)
10-yr Note +13/32 1.701
NYSE Adv 991 Dec 2174 Vol 1.2 bln
Nasdaq Adv 1204 Dec 2945 Vol 5.2 bln

Industry Watch
Strong: Energy, Utilities, Real Estate, Health Care, Consumer Staples
Weak: Financials, Information Technology, Consumer Discretionary

Moving the Market

-- Down day for major indices as Russia seizes nuclear power plant in Ukraine and oil prices jump 7%

-- February employment report features strong jobs growth but flat earnings growth

-- Treasury yield curve flattens

Major indices close lower amid increased geopolitical risks
04-Mar-22 16:20 ET
Dow -179.86 at 33614.80, Nasdaq -224.50 at 13313.44, S&P -34.62 at 4328.87

[BRIEFING.COM] The S&P 500 fell 0.8% on Friday, as risk sentiment was undercut by Russia's takeover of a nuclear power plant in Ukraine and by a 7% increase in oil prices ($115.27, +7.46, +6.9%).

The Nasdaq Composite (-1.7%) and Russell 2000 (-1.6%) each declined by more than 1.5% while the Dow Jones Industrial Average (-0.5%) outperformed on a relative basis with a 0.5% decline.

Startling images of a fire at the nuclear plant, which is the largest in Europe and supplies a quarter of Ukraine's power, catalyzed the negative bias overnight. Fortunately, there wasn't a radiation leakage at the plant, and authorities reported that radiation levels were normal.

Still, the news stoked concerns of nuclear conflict and, in turn, contributed to early de-risking efforts. The market pared losses in the afternoon, though, leaving six of the 11 S&P 500 sectors in negative territory, including the heavily-weighted financials (-2.0%) and information technology (-1.8%) sectors at the bottom of the pack.

The energy sector rose 2.9%, thanks to elevated oil prices, which gained momentum amid news that the White House was considering a ban on Russian oil imports. The utilities (+2.2%), real estate (+0.8%), health care (+0.5%), and consumer staples (+0.1%) sectors also closed higher amid some defensive positioning.

The geopolitical news overshadowed stronger-than-expected jobs growth displayed in the February employment report, which Chicago Fed President Evans (non-voter in FOMC) said will not change anything for the Fed's next meeting in a CNBC interview. Nonfarm payrolls increased by 678,000 (Briefing.com consensus 400,000).

Arguably, the bigger story in the employment report was the flat month-over-month growth in average hourly earnings (Briefing.com consensus +0.5%). Stagnant wage growth in an inflationary environment, marred by $115-per-barrel oil prices, painted a gloomy picture for consumer spending.

The Treasury market remained a signpost for growth concerns and a place for investors to seek safety. The yield curve flattened with the 2-yr yield declining by five basis points to 1.49% and the 10-yr yield declining by 12 basis points to 1.72%. The U.S. Dollar Index rose 0.7% to 98.50.

Separately, Broadcom (AVGO 595.99, +17.39, +3.0%) was an individual standout, rising 3.0% on pleasing earnings results and guidance, while Costco (COST 525.50, -7.55, -1.4%) fell alongside the broader market despite reporting better-than-expected earnings results.

Reviewing the employment report in more depth:

Hiring activity was strong in February, but wage increases were not. Nonfarm payrolls jumped by 678,000, yet average hourly earnings were unchanged. That left the year-over-year rate at 5.1%, down from 5.5% in January.
February nonfarm payrolls increased by 678,000 (Briefing.com consensus 400,000). The 3-month average for total nonfarm payrolls rose to 582,000 from 572,000. January nonfarm payrolls revised to 481,000 from 467,000. December nonfarm payrolls revised to 588,000 from 510,000.
February private sector payrolls increased by 654,000 (Briefing.com consensus 390,000). January private sector payrolls revised to 448,000 from 444,000. December private sector payrolls revised to 561,000 from 503,000.
February unemployment rate was 3.8% (Briefing.com consensus 3.9%), versus 4.0% in January. Persons unemployed for 27 weeks or more accounted for 26.7% of the unemployed versus 25.9% in January. The U6 unemployment rate, which accounts for unemployed and underemployed workers, was 7.2%, versus 7.1% in January.
February average hourly earnings were unchanged (Briefing.com consensus 0.5%) versus a downwardly revised 0.6% increase (from 0.7%) in January. Over the last 12 months, average hourly earnings have risen 5.1%, versus 5.5% for the 12 months ending in January.
The average workweek in February was 34.7 hours (Briefing.com consensus 34.6), versus an upwardly revised 34.6 hours (from 34.5) in January. Manufacturing workweek increased 0.4 hours to 40.7 hours. Factory overtime increased 0.2 hours to 3.6 hours.
The labor force participation rate increased to 62.3% from 62.2% in January.
The employment-population ratio rose to 59.9% from 59.7% in January.
Some will paint the average hourly earnings figure as good news insomuch as it will temper some of the worries about inflation pressures broadening out due to rising wages and the Fed needing to take a more aggressive step toward removing its policy accommodation. However, it isn't truly good economic news.
The key takeaway from the report is that real average hourly earnings are negative and that is likely going to adversely impact consumer spending activity in the face of escalating inflation pressures, which will be acute at the gas pump and in the grocery aisles. This report, then, is good for now, yet it may not translate later into as good of things for the economy and corporate earnings.

Looking ahead, investors will receive the Consumer Credit report for January on Monday.

Dow Jones Industrial Average -7.5% YTD
S&P 500 -9.2% YTD
Russell 2000 -10.9% YTD
Nasdaq Composite -14.9% YTD

Crude futures settle above $115.00 per barrel
04-Mar-22 15:30 ET
Dow -312.54 at 33482.12, Nasdaq -257.51 at 13280.43, S&P -48.93 at 4314.56

[BRIEFING.COM] The S&P 500 is down 1.1% as investors show a reluctance to buy the dip in front of the weekend, which could bring on bad geopolitical news.

One last look at the sectors shows financials (-2.6%) and information technology (-2.1% down more than 2.0%, while the energy (+2.9%) and utilities (+1.8%) sectors sport decent gains. Six sectors trade lower, while five sectors trade higher.

WTI crude futures settled higher by $7.46 (+6.9%) to $115.27/barrel.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 33891.35 +596.40 (1.79%)
Nasdaq 13752.01 +219.56 (1.62%)
SP 500 4386.54 +80.28 (1.86%)
10-yr Note -27/32 1.786
NYSE Adv 2286 Dec 897 Vol 1.1 bln
Nasdaq Adv 2714 Dec 1525 Vol 5.2 bln

Industry Watch
Strong: Energy, Financials, Materials, Industrials, Information Technology
Weak: Communication Services

Moving the Market

-- Stocks, Treasury yields, and oil prices rise in hopeful session

-- Cease-fire talks reportedly scheduled for tomorrow

-- Fed Chair Powell says Fed will "proceed carefully" and that he supports a 25-bps hike this month

Stocks, Treasury yields, and oil prices rally in hopeful session
02-Mar-22 16:15 ET
Dow +596.40 at 33891.35, Nasdaq +219.56 at 13752.01, S&P +80.28 at 4386.54

[BRIEFING.COM] The S&P 500 advanced 1.9% on Wednesday, as stocks rallied past another spike in oil prices amid hope surrounding the Russia-Ukraine conflict and a potentially less-hawkish Fed. WTI crude futures topped $110 per barrel ($111.04, +7.61, +7.4%).

The Nasdaq Composite (+1.6%) and Dow Jones Industrial Average (+1.8%) both looked up to the benchmark index while the Russell 2000 outperformed with a 2.5% gain.

All 11 S&P 500 sectors closed higher, and 29 of the 30 Dow components closed higher. The cyclical financials (+2.6%), energy (+2.2%), materials (+2.2%), and industrials (+2.2%) sectors each rose more than 2.0%, as did the information technology sector (+2.2%). The communication services sector (+0.7%) underperformed on a relative basis.

The spike in oil prices was attributed to increased expectations for supply constraints after Russia continued its offensive in Ukraine, but the market might have suspected a near-term peak in prices, depending on the result of cease-fire talks scheduled for tomorrow.

Equally as important to the trading narrative today was what Fed Chair Powell told the House Financial Services Committee in his semiannual report on monetary policy.

The Fed chair said the central bank would "proceed carefully" because of the geopolitical uncertainty and that he would support hiking rates by 25 basis points later this month. He went on to say, though, that a 50-bps hike is still possible in the future if inflation is higher than expected.

On a related note, the Fed's Beige Book noted that economic activity expanded at a modest to moderate pace between mid-January and February 18. Some Districts reported a temporary weakening in demand in the hospitality sector due to increased COVID-19 cases.

Treasury yields rose double-digit basis points after a two-day plunge, illustrating how negative sentiment had gotten because of the geopolitical tensions. The 2-yr yield jumped 22 basis points to 1.52%, and the 10-yr yield jumped 16 basis points to 1.87%. The U.S. Dollar Index dipped 0.1% to 97.34.

Other supportive factors included a better-than-expected ADP Employment Change report, which estimated 475,000 additions to private sector payrolls in February (Briefing.com consensus 350,000), and positive earnings news/reactions in salesforce.com (CRM 210.39, +1.50, +0.7%), Nordstrom (JWN 26.93, +7.39, +37.8%), Ross Stores (ROST 95.00, +5.45, +6.1%), and Hewlett Packard Enterprises (HPE 16.99, +1.68, +10.3%).

Reviewing Wednesday's economic data:

The ADP Employment Change report estimated that 475,000 jobs were added to private sector payrolls in February (Briefing.com consensus 350,000). The increase in January was upwardly revised to 509,000 from -301,000.
Weekly crude oil inventories decreased by 2.6 mln barrels after increasing by 4.5 mln barrels during the previous week.
The weekly MBA Mortgage Applications Index decreased 0.7% following a 13.1% decline in the prior week.

Looking ahead, investors will receive the weekly Initial and Continuing Claims report, the ISM Non-Manufacturing Index for February, revised Q4 readings for Productivity and Unit Labor Costs, and Factory Orders for January on Thursday.

Dow Jones Industrial Average -6.7% YTD
S&P 500 -8.0% YTD
Russell 2000 -8.3% YTD
Nasdaq Composite -12.1% YTD

Crude futures settle above $110 per barrel
02-Mar-22 15:30 ET
Dow +610.50 at 33905.45, Nasdaq +233.07 at 13765.52, S&P +84.31 at 4390.57

[BRIEFING.COM] The S&P 500 continues to hold a bullish bias with a 2.0% gain amid support from all 11 of its sectors.

The energy (+2.8%), financials (+2.6%), industrials (+2.3%), and materials (+2.3%) sectors are representing the cyclical leadership, but the information technology sector (+2.4%) is also keeping pace. The communication services sector (+0.8%) underperforms on a relative basis with a 0.8% gain.

WTI crude futures settled sharply higher by 7.1%, or $7.31, to $110.72/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 33294.95 -597.65 (-1.76%)
Nasdaq 13532.45 -218.94 (-1.59%)
SP 500 4306.26 -67.68 (-1.55%)
10-yr Note +30/32 1.739
NYSE Adv 1326 Dec 1906 Vol 1.3 bln
Nasdaq Adv 1637 Dec 2602 Vol 6.0 bln

Industry Watch
Strong: Energy, Real Estate
Weak: Financials, Materials, Information Technology

Moving the Market

-- Russia ratchets up attack in Ukraine, long convoy of military vehicles approach Kyiv

-- Oil prices top $105 per barrel, even as IEA member countries agree to release 60 million barrels of oil from reserves

-- 10-yr yield drops to 1.70%

Stocks fall while oil prices top $100 on worsening geopolitical tensions
01-Mar-22 16:25 ET
Dow -597.65 at 33294.95, Nasdaq -218.94 at 13532.45, S&P -67.68 at 4306.26

[BRIEFING.COM] The S&P 500 fell 1.6% on Tuesday in a risk-off session, which saw oil prices peak above $106 per barrel and Treasury yields drop noticeably in response to worsening geopolitical tensions. The Nasdaq Composite (-1.6%), Dow Jones Industrial Average (-1.8%), and Russel 2000 (-1.9%) also declined more than 1.5%.

Tensions worsened as Russian forces attacked civilian areas in Ukraine and Russia's defense ministry warned of missile strikes on Ukrainian intelligence and communications facilities in Kyiv. Satellites images of a 40-mile long convoy of Russian military vehicles approaching Kyiv were especially unnerving for the market.

The stock market tried to shake off the bad news with a flat open, but the understanding that things could get worse before they get better -- with a negative impact to growth prospects -- washed out the buyers.

Ten of the 11 S&P 500 sectors closed lower, with the financials sector (-3.7%) taking a brunt of the damage and the information technology sector (-1.9%) acting as a heavy drag. Growth and value stocks alike declined together.

The energy sector (+1.0%), unsurprisingly, closed higher, but it was a little surprising to see just a 1.0% gain when oil prices settled higher by 8.3%, or $7.88, to $103.41/bbl. The relative disconnect might have been owed to the view that the high oil prices will give way to decreased demand.

Interestingly, oil prices received little relief from an agreement among 31 EIA members to release 60 million barrels of oil from their reserves. Supply-constraint fears were the primary driver for prices, which in turn, could dampen consumer sentiment and spending.

The Treasury market was a signpost for growth concerns, which were further exacerbated by more U.S. companies restricting their services in Russia and by disappointing guidance from Zoom Video (ZM 122.78, -9.82, -7.4%), GoodRx (GDRX 16.73, -10.67, -38.9%), and Ambarella (AMBA 96.03, -43.68, -31.3%).

The 10-yr yield accordingly dropped 13 basis points to 1.71% (-28 bps in two days). The 2-yr yield also dropped 13 basis points to 1.30% (-27 bps in two sessions) on the burgeoning belief that the Fed will be less hawkish than previously feared because of the geopolitical risks to the economy.

The U.S. Dollar Index rose 0.7% to 97.35. The CBOE Volatility Index rose 10.5% to 33.32. Gold futures rose 2.3% to $1944.70/ozt.

Reviewing Tuesday's economic data:

The February ISM Manufacturing Index increased to 58.6% (Briefing.com consensus 58.0%) from 57.6% in January. A number above 50.0% is indicative of expansion. February marked the 21st straight month of expansion for the manufacturing sector.
The key takeaway from the report is that new orders growth helped drive the faster expansion activity in February, showing that the effects of the Omicron variant had lessened; moreover, a strong pickup in the backlog of orders index -- the largest since January 2011 -- is a reflection of pent-up production potential that should keep the manufacturing sector in an expansion mode.
Total construction spending increased 1.3% month-over-month in January (Briefing.com consensus -0.4%) following an upwardly revised 0.8% increase (from 0.2%) in December. That was the strongest increase since the same period a year ago.
The key takeaway from the report is that there was strength in both residential and nonresidential spending, reflecting a fairly broad-based pickup in construction spending activity.
The final IHS Markit Manufacturing PMI for February decreased to 57.3 from 57.5 in the preliminary reading.

Looking ahead, investors will receive the ADP Employment Change report for February, the Fed's Beige Book, and the weekly MBA Mortgage Applications Index on Wednesday.

Dow Jones Industrial Average -8.4% YTD
S&P 500 -9.7% YTD
Russell 2000 -10.6% YTD
Nasdaq Composite -13.5% YTD

Crude futures settle above $103.00
01-Mar-22 15:30 ET
Dow -630.21 at 33262.39, Nasdaq -232.16 at 13519.23, S&P -41.30 at 4332.64

[BRIEFING.COM] The S&P 500 is down 1.5%, as is the Russell 2000 (-1.5%).

One last look at the sectors shows financials (-3.6%), information technology (-2.1%), and materials (-2.3%) pacing the retreat. The energy sector (+0.8%) remains the only sector trading higher, yet its 0.8% gain pales in comparison to the 9% gain in oil futures.

WTI crude futures settled the session higher by 8.3%, or $7.88, to $103.41/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 33892.60 -166.15 (-0.49%)
Nasdaq 13751.39 +56.77 (0.41%)
SP 500 4373.94 -10.71 (-0.24%)
10-yr Note +12/32 1.834
NYSE Adv 1501 Dec 1642 Vol 1.7 bln
Nasdaq Adv 2130 Dec 2103 Vol 5.7 bln

Industry Watch
Strong: Energy, Industrials, Consumer Discretionary, Utilities
Weak: Real Estate, Financials, Consumer Staples, Materials

Moving the Market

-- Volatile action driven by Russia-Ukraine headlines and month-end rebalancing activity

-- Certain Russian banks blocked from SWIFT financial transactions system; Putin places nuclear forces on high alert

-- Russia vows harsh response for sanctions it faces

Russia-Ukraine headlines drive mixed and volatile session
28-Feb-22 16:15 ET
Dow -166.15 at 33892.60, Nasdaq +56.77 at 13751.39, S&P -10.71 at 4373.94

[BRIEFING.COM] The S&P 500 declined 0.3% on Monday in a volatile session driven by Russia-Ukraine headlines. The Dow Jones Industrial Average fell 0.5%, while the Nasdaq Composite (+0.4%) and Russell 2000 (+0.4%) both gained 0.4%, thanks to a late-session push.

The financials (-1.5%), real estate (-1.8%), consumer staples (-1.3%), and materials (-1.2%) sectors underperformed with losses over 1.0%. Conversely, the energy sector (+2.6%) jumped over 2.0% amid higher oil prices ($95.53, +3.94, +4.3%), followed by industrials (+0.7%), consumer discretionary (+0.6%), and utilities (+0.4%) with more modest gains.

The market got off to a weak start after the U.S. and Western allies expanded sanctions against Russia over the weekend. They blocked select Russian banks from the SWIFT financial transactions system and prevented Russia's central bank from accessing its foreign currency reserves.

In turn, the ruble plunged against the dollar, Russia's central bank hiked its key rate to 20.0% from 9.5% to protect the ruble, and President Putin placed Russia's nuclear forces on high alert. Russia also closed its stock market for the day.

Despite the negative-sounding developments, the S&P 500, Nasdaq, and Russell 2000 resiliently made their way into positive territory in the morning. Investors, however, faded the turnaround, and stocks pushed to session lows on news that Russia vowed a harsh response to the sanctions.

Stocks bounced off session lows in the last 30 minutes of action, exuding month-end rebalancing activity since there wasn't a specific news catalyst to account for the positive price action. The S&P 500 ended the month with a 3.1% decline.

The Treasury market was less volatile in the sense that yields stayed sharply low the entire session. Demand was driven by safe-haven interest, short-covering activity, growth concerns, and a belief that the Fed could sound less hawkish in its next policy meeting. The fed funds futures market is heavily favoring a quarter-point hike in March instead of a half-point hike.

The 2-yr yield dropped 16 basis points to 1.43%, and the 10-yr yield dropped 15 basis points to 1.84%. The U.S. Dollar Index increased 0.1% to 96.75. The CBOE Volatility Index (VIX) increased 9.3% to 30.15 amid increased hedging interest, although the VIX did close off session highs (33.51).

Reviewing Monday's economic data:

The Chicago PMI for February decreased to 56.3 (Briefing.com consensus 62.0) from 65.2 in January.
The Advance report for International Trade in Goods for January showed a deficit of $107.6 billion, versus a revised $100.5 billion (from $101.0 billion) in December. The Advance report for Retail Inventories for January rose 1.9%, while the Advance report for Wholesale Inventories for January rose 0.8%.

Looking ahead, investors will receive the ISM Manufacturing Index for February, Construction Spending for January, and the final IHS Markit Manufacturing PMI for February on Tuesday.

Dow Jones Industrial Average -6.7% YTD
S&P 500 -8.2% YTD
Russell 2000 -8.8% YTD
Nasdaq Composite -12.1% YTD

Crude futures settle higher by 4%
28-Feb-22 15:30 ET
Dow -372.58 at 33686.17, Nasdaq -42.95 at 13651.67, S&P -40.40 at 4344.25

[BRIEFING.COM] The S&P 500 is down 0.9% to trade off session lows (-1.6%).

One last look at the sectors shows real estate (-2.2%) and financials (-2.0%) down the most with 2% declines, while the energy (+1.9%), industrials (+0.1%), and utilities (+0.1%) sectors outperform in positive territory.

WTI crude futures settled higher by 4.3%, or $3.94, to $95.53/bbl amid the rise in geopolitical tensions.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34058.75 +834.92 (2.51%)
Nasdaq 13694.62 +221.04 (1.64%)
SP 500 4384.65 +95.95 (2.24%)
10-yr Note 0/32 1.970
NYSE Adv 2615 Dec 570 Vol 1.1 bln
Nasdaq Adv 3013 Dec 1229 Vol 4.6 bln

Industry Watch
Strong: Materials, Financials, Utilities, Consumer Staples, Health Care
Weak: Information Technology

Moving the Market

-- Stocks extend rebound rally and close at session highs

-- Russia says it's willing to seek diplomatic solutions with Ukraine as troops enter Kiev

-- PCE inflation for January remained hot

Stocks extend rally on improved geopolitical perspective
25-Feb-22 16:15 ET
Dow +834.92 at 34058.75, Nasdaq +221.04 at 13694.62, S&P +95.95 at 4384.65

[BRIEFING.COM] The S&P 500 rose 2.2% on Friday in a continuation of yesterday's rebound rally, as the market hoped that the deadly Russia-Ukraine situation would soon be over with minimal economic impact to the U.S.

The Dow Jones Industrial Average (+2.5%) and Russell 2000 (+2.3%) also gained more than 2.0% while the Nasdaq Composite (+1.6%) was the relative underperformer with a 1.6% gain after outperforming yesterday.

Prior to the open, futures turned positive after reports indicated that Russia was ready to seek diplomatic solutions with Ukraine in Minsk, Belarus. Presumably, that would happen after Russia gets what it wants since Russian troops were reportedly closing in on Ukraine's capital.

Since no sanctions were placed on Russia's oil and gas exports, there was optimism that the situation wouldn't exacerbate inflation pressures as initially feared. WTI crude ($91.59/bbl, -1.21, -1.3%), natural gas ($4.51/MMBtu, -0.16, -3.3%), and wheat ($859.60/bu, -$75.00, -8.0%) futures each settled lower.

The advance in equities was steady and broad-based with all 11 S&P 500 sectors closing higher between 1.4% (information technology) and 3.6% (materials). Interestingly, the defensive-oriented consumer staples (+3.1%), utilities (+3.1%), and health care (+3.0%) sectors were among the leaders, as investors respected the possibility for a negative-sounding update over the weekend.

There was a slight hiccup on news that the U.S. will join the EU with its own sanctions on President Putin, but stocks still closed at session highs.

Despite the improved geopolitical perspective, investors (and the Fed) were reminded that inflation is still a sticky situation. The Fed's preferred inflation gauge -- the PCE Price Index -- continued to run hot in January.

Specifically, the PCE Price Index rose 0.6% (Briefing.com consensus 0.5%), taking the year-over-year growth rate to 6.1% from 5.8%. The core PCE Price Index, which excludes food and energy, rose 0.5% (Briefing.com consensus 0.5%), taking the year-over-year rate to 5.2% from 4.9%.

The 2-yr Treasury note yield increased five basis points to 1.57%, although that was below the level it was trading prior to the PCE inflation data. The 10-yr yield increased two basis points to 1.99%. The U.S. Dollar Index fell 0.6% to 96.54. The CBOE Volatility Index fell 9.0% to 27.59.

Reviewing Friday's economic data:

Personal income was unchanged month-over-month in January (Briefing.com consensus -0.3%), but real disposable personal income was down 0.5%. Personal spending was up a robust 2.1% (Briefing.com consensus 1.5%), but clearly, consumers were spending out of savings as the personal savings rate, as a percentage of disposable personal income, fell to 6.4% from 8.2%. The PCE Price Index was up 0.6% (Briefing.com consensus 0.5%), taking the year-over-year rate to 6.1% from 5.8%. The core PCE Price Index, which excludes food and energy, was up 0.5% for the fourth straight month (Briefing.com consensus 0.5%), taking the year-over-year growth rate to 5.2% from 4.9%.
The key takeaway from the report is that the Fed still has an acute inflation problem on its hands with, or without, the Ukraine situation.
Durable Goods Orders jumped 1.6% month-over-month January (Briefing.com consensus 0.6%) following a 1.2% increase in December. Excluding transportation, durable goods orders were up 0.7% (Briefing.com consensus 0.3%) on the heels of a 0.9% increase in December.
The key takeaway from the report was the recognition that business spending picked up in January, evidenced by the 0.9% increase in nondefense capital goods orders excluding aircraft that followed a 0.4% increase in December.
The final reading for the University of Michigan Consumer Sentiment Index for February was revised up to 62.8 (Briefing.com consensus 61.6) from the preliminary reading of 61.7. The final reading for January was 67.2.
The key takeaway from the report is that the decline in sentiment in February was driven entirely by households with incomes of $100,000 or more, demonstrating the growing concerns about inflation, rising interest rates, and loss of purchasing power that could eventually manifest itself in weaker levels of consumer spending in coming months.
Pending home sales fell 5.7% m/m in January following a revised 2.3% decline (from -3.8%) in December.

Looking ahead, investors will receive the Chicago PMI for February and the Advance readings for International Trade in Goods, Retail Inventories, and Wholesale Inventories for January on Monday.

Dow Jones Industrial Average -6.3% YTD
S&P 500 -8.0% YTD
Russell 2000 -9.1% YTD
Nasdaq Composite -12.5% YTD

Crude futures settle lower
25-Feb-22 15:30 ET
Dow +773.85 at 33997.68, Nasdaq +175.49 at 13649.07, S&P +84.73 at 4373.43

[BRIEFING.COM] The S&P 500 is up 2.0% to trade back near session highs. The Russell 2000 is up 1.6%.

One last look at the S&P 500 sectors shows gains across the board ranging between 1.2% (information technology) and 3.5% (materials). The Dow Jones Transportation Average is up 2.5%.

WTI crude futures settled lower by 1.3%, or $1.21, to $91.59/bbl. Recall, crude futures briefly topped $100.00/bbl yesterday.

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Market Snapshot

briefing.com

Dow 33223.83 +92.07 (0.28%)
Nasdaq 13473.58 +436.10 (3.34%)
SP 500 4288.70 +63.20 (1.50%)
10-yr Note +24/32 1.976

NYSE Adv 1860 Dec 1383 Vol 1.5 bln
Nasdaq Adv 2498 Dec 1668 Vol 6.1 bln


Industry Watch
Strong: Information Technology, Communication Services

Weak: Financials, Consumer Staples, Materials


Moving the Market
-- Russia invades Ukraine

-- Stocks rally into positive territory after initially selling off

-- President Biden announces sanctions against Russia that weren't as severe as anticipated

-- Oil prices retrace initial pop, Treasury yields settled off lows





Stocks make huge comeback despite Russian invasion
24-Feb-22 16:15 ET

Dow +92.07 at 33223.83, Nasdaq +436.10 at 13473.58, S&P +63.20 at 4288.70
[BRIEFING.COM] The S&P 500 dropped as much as 2.6% on Thursday after Russia invaded Ukraine, but the benchmark index ended the session up 1.5% in a buy-the-dip trade led by the mega-caps/growth stocks.

The Nasdaq Composite rose 3.3% after being down 3.5% intraday. The Russell 2000 rose 2.6% after being down 2.6% intraday. The Dow Jones Industrial Average rose 0.3% after being down 2.6% intraday.

Initially, investors dumped risk assets and flocked into safe-haven assets like Treasuries and gold. WTI crude futures even peaked above $100.00 per barrel. All 11 S&P 500 sectors were trading lower, and Russia's MOEX and RTS indices tanked 33% and 38%, respectively.

U.S. stocks gradually came back, though, and the rebound bid gathered steam as President Biden announced new sanctions against Russia that weren't as severe as some were thinking (or hoping).

Notably, the U.S. will limit certain Russian exports but not oil and gas exports. The U.S. will limit Russia's ability to do business in dollars, euros, pounds, and yen, but it will allow Russia to still use the SWIFT financial system. President Putin was not sanctioned.

The most beaten-up stocks -- particularly the mega-caps -- in the S&P 500 information technology (+3.5%), communication services (+3.1%), and consumer discretionary (+2.5%) sectors helped lift the market into positive territory. The Vanguard Mega Cap Growth ETF (MGK 222.02, +7.14) rallied 3.3%.

Conversely, the consumer staples (-1.7%), financials (-1.2%), energy (-0.9%), and materials (-0.3%) sectors were the four sectors that still closed lower.

The Russia-Ukraine situation could still get worse, but the comeback in stock prices, the retracement in oil prices ($92.80, +0.68, +0.7%), and the decreased demand for Treasuries provided investors reasons to lighten up.

In the Treasury market, the 2-yr yield declined six basis points to 1.54% after touching 1.46% overnight. The 10-yr yield declined one basis point to 1.97% after touching 1.84% overnight. The U.S. Dollar Index rose 0.9% to 97.03. Gold futures rose 0.9% to $1926.60/ozt but turned negative after the settlement time.

Separately, Cleveland Fed President Mester (FOMC voter) acknowledged that the geopolitical landscape will play a role in determining the appropriate pace of removing accommodation. That's to say if the situation worsens inflation, the central bank could double down with its tightening plans, but if not, then the Fed might be more forgiving.

Reviewing Thursday's economic data:

New home sales decreased 4.5% month-over-month in January to a seasonally adjusted annual rate of 801,000 units (Briefing.com consensus 805,000) from an upwardly revised 839,000 (from 811,000) in December.
The key takeaway from the report is the recognition that the sale of lower-priced homes has decelerated, likely due to less supply and affordability pressures. That is leading to higher-priced homes accounting for a larger percentage of new homes sold, which is driving up both median and average selling prices.
Initial jobless claims for the week ending February 19 decreased by 17,000 to 232,000 (Briefing.com consensus 240,000) and continuing claims for the week ending February 12 decreased by 112,000 to 1.476 million -- the lowest level since March 14, 1970.
The key takeaway from the report is that initial claims are at a level that is consistent with a tight labor market.
Q4 GDP was revised up to 7.0%, as expected, from the advance estimate of 6.9%, but the GDP Price Deflator was also revised up to 7.1% (Briefing.com consensus 6.9%) from the advance estimate of 6.9%.
The key takeaway from the report is the recognition that inventory building accounted for the bulk of the GDP increase in Q4, accounting for 4.90 percentage points. Real final sales of domestic product, which exclude the change in private inventories, were up 2.0%.

Looking ahead to Friday, investors will receive Personal Income and Spending for January, PCE Prices for January, Durable Goods Orders for January, Pending Home Sales for January, and the final University of Michigan Index of Consumer Sentiment for February.

Dow Jones Industrial Average -8.6% YTD
S&P 500 -10.0% YTD
Russell 2000 -11.2% YTD
Nasdaq Composite -13.9% YTD



WTI crude retraces most of its gains
24-Feb-22 15:30 ET

Dow -200.26 at 32931.50, Nasdaq +304.87 at 13342.35, S&P +22.70 at 4248.20
[BRIEFING.COM] The S&P 500 is up 0.5%, and the Russell 2000 is up 1.7%.

One last look at the sectors shows communication services (+2.4%), information technology (+2.5%), and consumer discretionary (+1.8%) up noticeably, while the consumer staples (-2.3%), financials (-1.9%), and energy (-1.7%) sectors remain deep in the red.

WTI crude futures settled higher by just 0.7%, or $0.68, to $92.80/bbl after peaking above $100.00/bbl in early action.

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Market Snapshot



https://www.briefing.com/stock-market-update



Dow 33131.76 -464.85 (-1.38%)
Nasdaq 13037.48 -344.03 (-2.57%)
SP 500 4225.50 -79.26 (-1.84%)
10-yr Note -26/32 1.993

NYSE Adv 813 Dec 2394 Vol 1.0 bln
Nasdaq Adv 1098 Dec 3127 Vol 4.5 bln


Industry Watch
Strong: Energy

Weak: Consumer Discretionary, Information Technology, Financials, Industrials


Moving the Market
-- Stocks close at session lows in disappointing session

-- Russia-Ukraine situation only seemed to worsen

-- Growth stocks led the retreat

-- Treasury market did not show a flight to safety





Stocks close sharply lower in disappointing session
23-Feb-22 16:15 ET

Dow -464.85 at 33131.76, Nasdaq -344.03 at 13037.48, S&P -79.26 at 4225.50
[BRIEFING.COM] The S&P 500 fell 1.8% on Wednesday, tumbling further into correction territory, in a disappointing session. Investors sold into rebound attempts as the Russia-Ukraine situation only seemed to worsen.

The Nasdaq Composite dropped 2.6%, representing the weakness in the mega-caps/growth stocks. The Dow Jones Industrial Average fell 1.4%, and the Russell 2000 fell 1.8%.

The first rebound attempt was at the open, which saw the S&P 500 up as much as 0.9% amid gains in all 11 of its sectors. That was driven primarily by mechanical factors on the belief that the market was primed for a rebound. The market, however, quickly turned negative.

There were only lower highs as the session progressed, feeding into the general pessimism in the market and the negative price momentum. The latest Russia-Ukraine headlines kept the buyers in hiding.

Briefly, Ukraine declared a state of emergency and mobilized its reserves; the U.S. canceled diplomatic meetings with Russia and expanded sanctions to Nord Stream 2 AG and its corporate officers; and the Biden administration warned Ukraine of a full-scale Russian invasion within 48 hours, according to Newsweek.

The growth stocks were at the forefront of selling interest, taking the S&P 500 consumer discretionary (-3.4%) and information technology (-2.6%) sectors to the bottom of the standings. Right before the close, the S&P 500 briefly dipped below its Jan. 24 intraday low (4222.62).

The energy sector (+1.0%) was the only sector that closed higher, rising 1% even as oil prices settled lower ($92.12, -0.15, -0.2%).

Away from equities, there was no flight to safety in the Treasury market, once again suggesting that the stock market's misery was owed to more than just geopolitics, namely the Fed potentially hiking into slower growth.

The 2-yr yield rose five basis points to 1.60%, and the 10-yr yield rose three basis points to 1.98%. The U.S. Dollar Index increased 0.2% to 96.21. On a related note, San Francisco Fed President Daly (not a voting FOMC member) said she supported removing accommodation, starting in March.

Wednesday's economic data was limited to the weekly MBA Mortgage Applications Index, which dropped 13.1% following a 5.4% decline in the prior week. Looking ahead, investors will receive weekly Initial and Continuing Claims, New Home Sales for January, and the second estimate for Q4 GDP on Thursday.

Dow Jones Industrial Average -8.8% YTD
S&P 500 -11.3% YTD
Russell 2000 -13.4% YTD
Nasdaq Composite -16.7% YTD



Crude futures turn negative
23-Feb-22 15:30 ET

Dow -361.98 at 33234.63, Nasdaq -269.84 at 13111.67, S&P -63.33 at 4241.43
[BRIEFING.COM] The S&P 500 continues to trade near session lows with a 1.5% decline.

One last look at the sectors shows energy (+1.1%) bucking the negative trend despite a fade in oil prices following reports that the U.S. is considering tapping into its oil reserves. The goal would be to counteract any increase in oil prices caused by the geopolitical issues overseas.

WTI crude settled lower by 0.2%, or $0.15, to $92.12/bbl.

[ReturntoSender]

Market Snapshot

https://www.briefing.com/stock-market-update

Dow 33596.61 -482.57 (-1.42%)
Nasdaq 13381.51 -166.55 (-1.23%)
SP 500 4304.76 -44.11 (-1.01%)
10-yr Note -2/32 1.949
NYSE Adv 706 Dec 2530 Vol 1.1 bln
Nasdaq Adv 1164 Dec 3140 Vol 4.8 bln

Industry Watch
Strong: Utilities, Real Estate, Health Care
Weak: Consumer Discretionary, Energy, Materials

Moving the Market

-- Russia-Ukraine tensions rise after Russia sends troops to two regions in eastern Ukraine

-- Lingering concerns about Fed policy

-- Home Depot (HD) falls 9% amid conservative FY22 sales guidance

Weak session captured by Russia-Ukraine headlines
22-Feb-22 16:20 ET
Dow -482.57 at 33596.61, Nasdaq -166.55 at 13381.51, S&P -44.11 at 4304.76

[BRIEFING.COM] The S&P 500 fell 1.0% on Tuesday, although it was down as much as 1.9% amid rising Russia-Ukraine tensions, pestering concerns about monetary policy, and weakening price momentum.

The Nasdaq Composite (-1.2%), Dow Jones Industrial Average (-1.4%), and Russell 2000 (-1.5%) also closed off their session lows, but still lost more than 1.0%.

Today's trading narrative was catalyzed by Russia's decision to recognize the independence of Ukraine's Donetsk and Luhansk regions and send "peacekeeping" troops to the oblasts. The U.S., UK, and EU announced initial sanctions, and Germany halted the approval process for the Nord Stream 2 pipeline from Russia.

All that transpired before the open, yet the futures market recovered losses and the S&P 500 briefly traded in positive territory after the open. Buyers lacked resolve, though, giving way to a broad-based decline and losses in all 11 S&P 500 sectors.

The consumer discretionary sector (-3.0%) was easily the weakest performer, largely due a 9% decline in Home Depot (HD 316.17, -30.70, -8.9%) following its conservative FY22 sales guidance. The utilities sector outperformed on a relative basis with a 0.1% decline.

Amid the geopolitical uncertainty, and slower growth prospects highlighted by Home Depot's guidance, investors remained concerned about the impacts of the Fed's tightening course.

The 2-yr yield rose eight basis points to 1.55% following rate-hike commentary from Fed Governor Bowman (FOMC voter) on Monday. Strikingly, the 10-yr yield increased two basis points to 1.93% despite the geopolitical tensions, supporting the case that the market was influenced by more than the Russia-Ukraine headlines.

Granted, the market did come off session lows in the afternoon after President Biden announced new sanctions on Russia, including sanctions on sovereign debt, two large financial institutions, and Russian elites and family members. Mr. Biden threatened additional sanctions if Russia escalates the situation.

The S&P 500 jumped nearly 70 points off its low in the course of an hour, but sellers came back in to spoil the rebound bid. The S&P 500 closed 10.3% off its record closing high, as well at its lowest closing level since Oct 4.

WTI crude futures settled above $92 per barrel ($92.27, +1.06, +1.2%) after flirting with $95 per barrel overnight. The U.S. Dollar Index was little changed at 96.07. The CBOE Volatility Index increased just 3.8% to 28.81

Reviewing Tuesday's economic data:

The Conference Board's Consumer Confidence Index dropped to 110.5 in February (Briefing.com consensus 109.0) from a downwardly revised 111.1 (from 113.8) in January. In the same period a year ago, the index stood at 95.2.
The key takeaway from the report is the recognition that expectations for short-term growth prospects weakened, pointing to a possible moderation in spending activity in coming months, particularly if inflation pressures remain persistent and real disposable personal income is negative.
The S&P Case-Shiller Home Price Index for December increased 18.6% year-over-year (Briefing.com consensus 18.3%) following an 18.3% increase in November.
The FHFA Housing Price Index for December increased 1.2% month-over-month following a revised 1.2% increase (from 1.1%) in November.
The preliminary IHS Markit Manufacturing PMI for February increased to 57.5 from 55.5 in January while the preliminary Services PMI increased to 56.7 from 51.2 in January.

Looking ahead, investors will receive the weekly MBA Mortgage Applications Index on Wednesday.

Dow Jones Industrial Average -7.5% YTD
S&P 500 -9.7% YTD
Russell 2000 -11.8% YTD
Nasdaq Composite -14.5% YTD

Crude futures settle higher but off highs
22-Feb-22 15:30 ET
Dow -347.12 at 33732.06, Nasdaq -63.71 at 13484.35, S&P -23.80 at 4325.07

[BRIEFING.COM] The S&P 500 is down 0.6%, and the Russell 2000 is down 0.2%.

One last look at the sectors shows consumer discretionary (-2.6%), energy (-1.4%), and materials (-1.0%) sectors underperforming the broader market, while the utilities (+0.2%), real estate (+0.2%), health care (+0.2%), and financials (+0.1%) sectors trade higher.

WTI crude futures settled higher by 1.2%, or $1.06, to $92.27/bbl after flirting with $95/bbl overnight.

[ReturntoSender]

Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34079.18 -232.85 (-0.68%)
Nasdaq 13548.06 -168.65 (-1.23%)
SP 500 4348.87 -31.39 (-0.72%)
10-yr Note +3/32 1.928
NYSE Adv 1225 Dec 1978 Vol 1.1 bln
Nasdaq Adv 1492 Dec 2796 Vol 4.4 bln

Industry Watch
Strong: Consumer Staples
Weak: Information Technology, Industrials, Communication Services

Moving the Market

-- Geopolitical uncertainty heading into the long weekend

-- Disappointing growth-stock earnings reactions (again)

-- Fed officials continued to prepare the market for rate hikes

Buyers hold back in front of three-day weekend
18-Feb-22 16:15 ET
Dow -232.85 at 34079.18, Nasdaq -168.65 at 13548.06, S&P -31.39 at 4348.87

[BRIEFING.COM] The S&P 500 decreased 0.7% on Friday, as risk sentiment remained pressured by geopolitical uncertainty, disappointing growth-stock earnings reactions, and expectations for tighter monetary policy. The benchmark index was down as much as 1.2% intraday and up as much as 0.3%.

The Dow Jones Industrial Average also declined 0.7% while the Nasdaq Composite (-1.2%) and Russell 2000 (-0.9%) fared slightly worse.

Ten of the 11 S&P 500 sectors closed lower, with the heavily-weighted information technology sector (-1.1%) exerting influential weakness at the bottom of the standings. The consumer staples sector (+0.1%) was the only sector that closed higher, eking out a 0.1% gain.

Regarding Russia-Ukraine, the U.S. maintained that a Russian invasion was imminent, even as Russia's foreign minister accepted an invitation to meet with Secretary of State Blinken next week. Mr. Blinken would travel to Europe for the meeting on the condition that there is no invasion of Ukraine.

With the market closed on Monday for Presidents' Day, buyers preferred to wait and see for what transpires over the long weekend. There was a precautionary trade in the Treasury market, where the 10-yr yield declined four basis points to 1.93%. The U.S. Dollar Index rose 0.3% to 96.09. Oil prices settled lower ($91.21, -0.55, -0.6%).

The decline in long-term rates provided little relief for the growth stocks, as investors were dismayed to see another round of steep, earnings-driven declines in the space. Roku (ROKU 112.46, -32.25, -22.3%), DraftKings (DKNG 17.29, -4.77, -21.6%), and Redfin (RDFN 22.86, -5.78, -20.2%) each plunged more than 20.0% following their reports.

The 2-yr yield, meanwhile, held steady at 1.47% as Fed officials continued to prepare the market for rate hikes.

Briefly, New York Fed President Williams (FOMC voter) said he supports steadily raising rates, starting in March. Cleveland Fed President Mester (FOMC voter) also advocated for a March rate hike, adding it would be appropriate to remove accommodation at a faster pace if inflation doesn't moderate as expected.

Separately, DuPont (DD 78.77, -0.96, -1.2%) agreed to sell the majority of its Mobility & Materials business to Celanese (CE 144.25, -8.00, -5.3%) for $11 billion in cash.

Reviewing Friday's economic data:

Existing home sales increased 6.7% m/m in January to a seasonally adjusted annual rate of 6.50 million (Briefing.com consensus 6.08 million). Total sales in January were down 2.3% from a year ago.
The key takeaway from the report is the push to buy existing homes in January as mortgage rates increased -- and were expected to increase further. That left unsold inventory at a record low, which is going to keep price pressures elevated and prospective buyers, particularly first-time buyers, facing an affordability pinch in the face of such lean supply for lower-priced homes and higher mortgage rates.
The Conference Board's Leading Economic Index decreased 0.3% m/m in January (Briefing.com consensus +0.2%) following a revised 0.7% increase (from 0.8%) in December.

When the market reopens on Tuesday, investors will receive the Consumer Confidence Index for February, the FHFA Housing Price Index for December, the S&P Case-Shiller Home Price Index for December, and the preliminary IHS Markit Manufacturing/Services PMIs for February.

Dow Jones Industrial Average -6.2% YTD
S&P 500 -8.8% YTD
Russell 2000 -10.5% YTD
Nasdaq Composite -13.4% YTD

Crude futures settle off session lows
18-Feb-22 15:30 ET
Dow -185.20 at 34126.83, Nasdaq -146.62 at 13570.09, S&P -26.69 at 4353.57

[BRIEFING.COM] The S&P 500 is down 0.6%, and the Russell 2000 is down 0.4%.

Looking at the sectors before the close shows information technology (-0.9%), energy (-0.8%), and industrials (-0.8%) underperforming the broad market, while the materials (+0.1%) and consumer staples (+0.1%) sectors cling onto slim gains.

WTI crude futures settled higher by 0.6%, or $0.55, to $91.21/bbl after being down as much as 2.9% intraday.

[ReturntoSender]

Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34312.03 -622.24 (-1.78%)
Nasdaq 13716.71 -407.38 (-2.88%)
SP 500 4380.26 -94.75 (-2.12%)
10-yr Note +28/32 1.974
NYSE Adv 849 Dec 2406 Vol 923.5 mln
Nasdaq Adv 1021 Dec 3262 Vol 4.2 bln

Industry Watch
Strong: Consumer Staples, Utilities
Weak: Information Technology, Communication Services, Consumer Discretionary

Moving the Market

-- Stocks close sharply lower in orderly retreat

-- Geopolitical angst surrounding Russia-Ukraine situation

-- Treasury yields dropped

-- NVIDIA (NVDA) leads mega-caps lower following its earnings report

Geopolitical angst sends stocks lower
17-Feb-22 16:15 ET
Dow -622.24 at 34312.03, Nasdaq -407.38 at 13716.71, S&P -94.75 at 4380.26

[BRIEFING.COM] The S&P 500 dropped 2.1% on Thursday, as risk sentiment remained pressured by negative-sounding Russia-Ukraine headlines. The Nasdaq Composite (-2.9%) and Russell 2000 (-2.5%) posted steeper declines while the Dow Jones Industrial Average (-1.8%) fared slightly better than the S&P 500.

Briefly, President Biden warned that Russia could invade Ukraine in a matter of days as reports indicated that Russia was building up troops closer to Ukraine. The Wall Street Journal also reported that Russia was possibly fabricating an excuse to invade with an accusation that Ukraine was committing crimes against residents of the eastern Donbas region.

Without any signs of de-escalation, there were little efforts to buy the dip, which contributed to an orderly retreat throughout the day. Nine of the 11 S&P 500 sectors closed in negative territory, led lower by the information technology (-3.1%), communication services (-3.0%), and consumer discretionary (-2.6%) sectors.

The consumer staples (+0.9%) and utilities (+0.1%) sectors closed higher as part of the defensive shift in the market.

More specifically, Treasuries saw increased demand, pushing the 10-yr yield down eight basis points to 1.97% and the 2-yr yield down five basis points to 1.47%. Gold futures rose 1.7% to $1902.10/ozt. The CBOE Volatility Index jumped 15.7% to 28.11. The U.S. Dollar Index increased 0.1% to 95.87.

Dow components Walmart (WMT 138.88, +5.35, +4.0%) and Cisco (CSCO 55.77, +1.52, +2.8%) performed well following their earnings reports, but not growth stocks like NVIDIA (NVDA 245.19, -19.92, -7.5%), Fastly (FSLY 19.20, -9.73, -33.6%), and Matterport (MTTR 6.54, -1.38, -17.4%).

The mega-caps received no love today. The Vanguard Mega Cap Growth ETF (MGK 226.18, -6.89) fell 3.0%, versus a 1.8% decline in the Invesco S&P 500 Equal Weight ETF (RSP 154.13, -2.82). Based on the latter indication, neither did the broad market.

Oil prices ($91.76/bbl, -$2.07, -2.2%) normally would have reacted positively to the geopolitical angst, but today they declined 2% amid reports suggesting that a nuclear agreement with Iran was within reach. An agreement could free up Iranian oil exports.

Also in the mix was economic data that didn't work in the market's favor. Weekly initial claims increased by 23,000 to 248,000 (Briefing.com consensus 220,000); the Philadelphia Fed Index for February decreased to 16.0 (Briefing.com consensus 20.4) from 23.2 in January; and single-family housing starts declined in every region in January, except the West (+15.7%).

Reviewing Thursday's economic data:

January housing starts declined 4.1% month-over-month to a seasonally adjusted annual rate of 1.638 million units (Briefing.com consensus 1.705 million) and building permits increased 0.7% month-over-month to 1.899 million (Briefing.com consensus 1.750 million).
The key takeaway from the report is the understanding that single-family starts declined in every region in January, except the West (+15.7%), which is likely a function of labor shortages and supply constraints that will keep new supply limited and home prices elevated.
Initial jobless claims for the week ending February 12 increased by 23,000 to 248,000 (Briefing.com consensus 220,000) and continuing claims for the week ending February 5 declined by 26,000 to 1.593 million.
The key takeaway from the report is that it covers the week in which the survey for the February employment report was conducted, and the pickup in initial claims could temper some of the growth forecasts for February nonfarm payrolls.
The Philadelphia Fed Index for February decreased to 16.0 (Briefing.com consensus 20.4) from 23.2 in January.

Looking ahead, investors will receive Existing Home Sales for January and the Conference Board's Leading Economic Index for January on Friday.

Dow Jones Industrial Average -5.6% YTD
S&P 500 -8.1% YTD
Russell 2000 -9.7% YTD
Nasdaq Composite -12.3% YTD

Crude futures settle sharply lower
17-Feb-22 15:30 ET
Dow -589.03 at 34345.24, Nasdaq -374.06 at 13750.03, S&P -86.89 at 4388.12

[BRIEFING.COM] The S&P 500 is now down 2.0% while the Russell 2000 underperforms with a 2.5% decline.

One last look at the sectors shows information technology (-2.9%), communication services (-2.7%), financials (-2.5%), and consumer discretionary (-2.4%) down more than 2.0%, while the consumer staples sector (+0.9%) is the lone sector trading higher.

WTI crude futures settled lower by 2.2%, or $2.07, to $91.76/bbl.

[ReturntoSender]

Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34934.27 -54.57 (-0.16%)
Nasdaq 14124.09 -15.66 (-0.11%)
SP 500 4475.01 +3.94 (0.09%)
10-yr Note +1/32 2.033
NYSE Adv 2061 Dec 1173 Vol 890.0 mln
Nasdaq Adv 2322 Dec 2066 Vol 4.1 bln

Industry Watch
Strong: Energy, Industrials
Weak: Information Technology, Communication Services

Moving the Market

-- S&P 500 turns positive following FOMC Minutes from January meeting

-- Reports indicate that there's no evidence that Russia has partially withdrawn troops and is instead building up forces near Ukraine

-- Growth stocks underperform

Stocks recoup losses following FOMC Minutes
16-Feb-22 16:15 ET
Dow -54.57 at 34934.27, Nasdaq -15.66 at 14124.09, S&P +3.94 at 4475.01

[BRIEFING.COM] The S&P 500 increased 0.1% on Wednesday, as the market reacted positively to the FOMC Minutes from the January meeting. Earlier in the day, the benchmark index was down as much as 0.9% amid negative-sounding Russia-Ukraine headlines.

The Nasdaq Composite lost 0.1% after being down 1.5% intraday. The Dow Jones Industrial Average lost 0.2% after being down 1.0% intraday. The Russell 2000 gained 0.1% after being down 0.8% intraday.

It was a tale of two sessions, as investors first held back risk appetite after Ukraine President Zelensky said he hadn't seen a withdrawal of Russian troops and NATO officials claimed that Russia was building up forces near Ukraine. Stocks fell to session lows after The Wall Street Journal reported that U.S. and Russian aircraft flew dangerously close to each other in three separate incidents over the weekend.

Ten of the 11 S&P 500 sectors were trading lower with the exception being energy (+0.8%) amid higher oil prices ($93.83, +1.76, +1.9%). Growth stocks were struggling amid disappointing earnings reactions in Shopify (SHOP 746.85, -142.65, -16.0%) and Roblox (RBLX 53.87, -19.43, -26.5%), as well as plans from Google to build more private advertising solutions.

Then, the January FOMC Minutes were released at 2:00 p.m. ET, and the dynamics of the market were flipped despite there being nothing terribly surprising in the minutes. Participants agreed the Fed should be more assertive in removing policy accommodation since, compared to the last normalization period, there is a much stronger outlook for economic growth, substantially higher inflation, and a notably tighter labor market.

Nine of the 11 S&P 500 sectors ended the session in positive territory, with materials (+0.7%) finishing in second place behind energy. The information technology (-0.2%) and communication services (-0.2%) sectors closed slightly lower.

Notwithstanding the dated nature of the minutes, investors might have liked they weren't as hawkish as feared. More insightful, however, was the reaction in the Treasury market, which suggested that the Fed's hawkish policy shift has been priced in. The 2-yr yield declined five basis points to 1.52%.

The 10-yr yield, meanwhile, was unchanged at 2.05% as the geopolitical factor offset hot import/export prices for January and better-than-expected retail sales data for January. The U.S. Dollar Index declined 0.2% to 95.78. Oil prices turned negative post-settlement.

Reviewing Wednesday's economic data, which featured Retail Sales for January:

Total retail sales for January increased 3.8% month-over-month (Briefing.com consensus 1.9%) following a downwardly revised 2.5% decline (from -1.9%) in December. Excluding autos, retail sales were up 3.3% month-over-month following a downwardly revised 2.8% decline (from -2.3%) in December.
Retail sales are not adjusted for price changes, so higher prices likely played a part in the strong increase; nonetheless, the key takeaway from the report is that it speaks to a consumer that is still willing and able to spend in spite of the inflation.
Total industrial production increased 1.4% month-over-month in January (Briefing.com consensus 0.4%) following an unrevised 0.1% decline in December. The capacity utilization rate jumped to 77.6% (Briefing.com consensus 76.8%) from an upwardly revised 76.6% (from 76.5%) in December.
The key takeaway from the report is that the increase was driven predominately by the output of utilities, which saw its largest increase (9.9%) in the history of the index, which dates back to 1972.
Import prices rose 2.0% in January after decreasing 0.4% in December. Excluding oil, import prices rose 1.4% after increasing 0.5% in December. Export prices rose 2.9% after decreasing 1.6% in December. Excluding agriculture, export prices rose 2.9% after decreasing 1.9% in December.
The NAHB Housing Market Index for February decreased to 82 (Briefing.com consensus 83) from 83 in January.
Business inventories increased 2.1% m/m in December (Briefing.com consensus 2.1%) following a revised 1.5% increase (from 1.3%) in November.
The weekly MBA Mortgage Applications Index fell 5.4% following an 8.1% decline in the prior week.

Looking ahead, investors will receive Housing Starts and Building Permits for January, weekly Initial and Continuing Claims, and the Philadelphia Fed Index for February on Thursday.

Dow Jones Industrial Average -3.9% YTD
S&P 500 -6.1% YTD
Russell 2000 -7.4% YTD
Nasdaq Composite -9.7% YTD

Crude futures settle higher
16-Feb-22 15:30 ET
Dow -16.99 at 34971.85, Nasdaq +15.42 at 14155.17, S&P +10.67 at 4481.74

[BRIEFING.COM] The S&P 500 is trading near session highs with a 0.2% gain after being down 0.9% earlier today.

One last look at the sectors shows ten sectors now trading in positive territory after ten traded lower today. The materials sector (+0.7%) has claimed the top spot, while the communication services sector (-0.1%) is down slightly.

WTI crude futures settled higher by 1.9%, or $1.76, to $93.83/bbl.

[ReturntoSender]

Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34988.84 +422.67 (1.22%)
Nasdaq 14139.75 +348.84 (2.53%)
SP 500 4471.07 +69.40 (1.58%)
10-yr Note -5/32 2.044
NYSE Adv 2483 Dec 4.3 bln Vol 919.2 mln
Nasdaq Adv 3392 Dec 1007 Vol 4.3 bln

Industry Watch
Strong: Information Technology, Consumer Discretionary
Weak: Energy, Utilities

Moving the Market

-- Relief rally on de-escalation news

-- Producer prices for January were much hotter than expected

-- S&P 500 closes above 200-day moving average (4455)

Stocks rally on de-escalation news
15-Feb-22 16:25 ET
Dow +422.67 at 34988.84, Nasdaq +348.84 at 14139.75, S&P +69.40 at 4471.07

[BRIEFING.COM] The S&P 500 rallied 1.6% on Tuesday, as the market welcomed a potential de-escalation in the Russia-Ukraine situation. The Nasdaq Composite (+2.5%) and Russell 2000 (+2.8%) both gained at least 2.5% while the Dow Jones Industrial Average gained 1.2%.

Prior to the open, reports indicated that Russia pulled back some troops from its border with Ukraine, which the market construed as a sign that Russia was indeed looking to resolve security issues through diplomacy. Most of today's gains were registered at the open following the de-escalation news.

The market proceeded to trade sideways the rest of the session, albeit with minor volatility after President Biden cautioned that the U.S. hadn't verified the withdrawal and that Russia could still attack. Nevertheless, the S&P 500 closed at session highs, reclaiming its 200-day moving average (4455), amid gains in nine of its 11 sectors.

The information technology (+2.7%) and consumer discretionary (+2.1%) sectors led the advance with gains over 2.0%. Conversely, the energy (-1.4%) and utilities (-0.6%) sectors closed lower.

Energy stocks struggled with the retracement in oil prices ($92.07, -3.41, -3.6%), which was a result of easing geopolitical angst. The latter was also the primary driver behind the five-basis-point increase in the 10-yr yield (2.05%), the softer dollar (96.01, -0.36, -0.4%), and the modest decline in gold prices ($1856.40, -13.00, -0.7%).

Interestingly, the 10-yr yield barely reacted to a much hotter-than-expected Producer Price Index (PPI) report. The index for final demand rose 1.0% m/m in January (Briefing.com consensus +0.5%), leaving it up 9.7% yr/yr. Excluding food and energy, the index for final demand rose 0.8% m/m (Briefing.com consensus +0.4%), leaving it up 8.3% yr/yr.

The PPI report may not have that surprising considering the hot CPI print last week while others interpreted the data as a sign of peak inflation, especially if the Fed follows through on being more aggressive in tightening policy. The 2-yr yield decreased two basis points to 1.57%.

In corporate news, Marriott (MAR 181.20, +8.97, +5.8%) reported better-than-expected earnings results, providing a boost for travel-related names. Intel (INTC 48.44, +0.86, +1.8%) announced an acquisition of Tower Semi (TSEM 47.07, +13.94, +42.1%) for $5.4 billion, or $53.00 per share, in cash.

Reviewing Tuesday's economic data:

The Producer Price Index for final demand jumped 1.0% month-over-month in January (Briefing.com consensus +0.5%) following an upwardly revised 0.4% increase (from +0.2%) in December. Excluding food and energy, the index for final demand increased 0.8% month-over-month (Briefing.com consensus +0.4%) following an upwardly revised 0.6% increase (from 0.5%) in December. On a year-over-year basis, the index for final demand was up 9.7% year-over-year on an unadjusted basis while the index for final demand, less food and energy, was up 8.3% year-over-year on an unadjusted basis.
The key takeaway from the report is that producer inflation pressures are clearly elevated. That is going to crimp profit margins unless those higher costs can be passed onto consumers, which is a problem unto itself. Net-net, inflation is all around and it has yet to show any meaningful signs of abating.
The Empire State Manufacturing Survey for February increased to 3.1 (Briefing.com consensus 25.0) from -0.7 in January.

Looking ahead, investors will receive a big batch of data on Wednesday, including Retail Sales for January, Industrial Production and Capacity Utilization for January, and the NAHB Housing Market Index for February along with the FOMC Minutes from the January meeting.

Dow Jones Industrial Average -3.7% YTD
S&P 500 -6.2% YTD
Russell 2000 -7.5% YTD
Nasdaq Composite -9.6% YTD

Crude futures settle sharply lower amid de-escalation news
15-Feb-22 15:30 ET
Dow +384.99 at 34951.16, Nasdaq +319.19 at 14110.10, S&P +64.56 at 4466.23

[BRIEFING.COM] The S&P 500 is up 1.5% but remains down 1.1% for the month.

One last look at the sectors shows seven up more than 1.0%, including a 2.6% gain in the consumer discretionary sector. The energy (-1.4%) and utilities (-0.7%) sectors, however, continue to trade lower.

WTI crude futures settled lower by 3.6%, or $3.41, to $92.07/bbl amid the de-escalation news with Russia and the West.
Utility stocks clipped by higher rates
15-Feb-22 15:05 ET
Dow +384.02 at 34950.19, Nasdaq +303.96 at 14094.87, S&P +62.08 at 4463.75

[BRIEFING.COM] The S&P 500 continues to trade higher by 1.4% while the Russell 2000 leaps ahead with a 2.6% gain.

The utilities sector (-0.8%) has extended losses amid broad-based weakness within the sector. The increase in long-term rates has pressured the rate-sensitive group with the 10-yr yield currently up four basis points to 2.04%.

Looking ahead, Airbnb (ABNB 178.51, +8.87, +5.3%) and Roblox (RBLX 71.91, +3.69, +5.3%) are some notable companies that will report earnings after the close.
Monolithic Power gains in sympathy to TSEM buyout news, FIS falls following earnings/guidance
15-Feb-22 14:25 ET
Dow +395.63 at 34961.80, Nasdaq +289.35 at 14080.26, S&P +61.68 at 4463.35

[BRIEFING.COM] The S&P 500 (+1.40%) still sits in second place to this point on Tuesday.

S&P 500 constituents Monolithic Power (MPWR 477.04, +43.72, +10.09%), American Airlines (AAL 18.83, +1.40, +8.03%), and Henry Schein (HSIC 81.61, +5.82, +7.68%) are some of today's top performers. MPWR gains as a sympathy play to Tower Semi's (TSEM 47.08, +13.95, +42.11%) move today, AAL grabbed an Outperform recommendation from Wolfe Research this morning, while HSIC posts a strong move in reaction to upbeat earnings and guidance.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34566.17 -171.89 (-0.49%)
Nasdaq 13790.91 -0.24 (0.00%)
SP 500 4401.67 -16.97 (-0.38%)
10-yr Note -26/32 1.989
NYSE Adv 908 Dec 2316 Vol 1.0 bln
Nasdaq Adv 1390 Dec 3035 Vol 4.2 bln

Industry Watch
Strong: Consumer Discretionary, Communication Services
Weak: Energy, Financials, Health Care, Real Estate

Moving the Market

-- Market preoccupied with Russia-Ukraine situation and rising rates

-- Door is open for diplomacy

-- St. Louis Fed President Bullard (FOMC voter) reiterates hawkish stance

Preoccupied with Russia-Ukraine and rising rates
14-Feb-22 16:15 ET
Dow -171.89 at 34566.17, Nasdaq -0.24 at 13790.91, S&P -16.97 at 4401.67

[BRIEFING.COM] The S&P 500 declined 0.4% on Monday, as the market remained preoccupied with the Russia-Ukraine situation and a continued rise in interest rates. The Dow Jones Industrial Average and Russell 2000 both declined 0.5%, while the Nasdaq Composite was unchanged.

Nine of the 11 S&P 500 sectors closed lower, paced by losses in the energy (-2.2%), financials (-1.1%), health care (-1.1%), and real estate (-1.0%) sectors. The consumer discretionary (+0.6%) and communication services (+0.3%) sectors closed higher.

Early on, the market felt relieved after Russia's Minister of Foreign Affairs opened the door for diplomacy with a statement that there's a chance for an agreement on security issues. The qualification that Russia doesn't have indefinite time to talk, though, served as a reminder that the situation is still serious.

The S&P 500 was trading flat midday until media reports misinterpreted a statement from Ukraine President Zelensky, who said Russia will attack on Feb. 16 and that he would declare that day a national holiday. The sarcastic tone contrasted with a precautionary move from the U.S. to relocate its Kyiv Embassy to western Ukraine.

Following these conflicting headlines, oil prices topped $95 per barrel ($95.48, +2.39, +2.6%) and the S&P 500 was down as much as 1.2%. At the same time, Treasury yields continued to push higher on expectations for a hawkish Fed amid persistent inflation pressures.

The 2-yr yield rose seven basis points to 1.59% as the CME FedWatch Tool continued to price in more than six rate hikes this year. The 10-yr yield rose four basis points to 2.00%. The U.S. Dollar Index increased 0.3% to 96.35.

St. Louis Fed President Bullard (FOMC voter) reiterated his hawkish stance in a CNBC interview, arguing that the Fed should front load tightening and that the central bank's credibility is on the line with respect to fighting inflation.

Interestingly, growth stocks outperformed on a relative basis despite the higher rates, and energy stocks performed terribly despite the higher oil prices. Rebalancing activity might have driven the discrepancies in addition to concerns that elevated oil prices could eventually hurt demand.

Separately, The Wall Street Journal reported that Cisco (CSCO 53.18, -0.72, -1.3%) made a recent offer to acquire Splunk (SPLK 124.97, +10.46, +9.1%) for $20 billion. Splunk turned down the offer, but SPLK shares still rose 9% on the takeover interest.

Investors did not receive any economic data on Monday. Looking ahead, investors will receive the Producer Price Index for January, the Empire State Manufacturing Survey for February, and Net Long-Term TIC Flows on Tuesday.

Dow Jones Industrial Average -4.9% YTD
S&P 500 -7.7% YTD
Russell 2000 -10.0% YTD
Nasdaq Composite -11.9% YTD

Crude futures top $95 per barrel
14-Feb-22 15:30 ET
Dow -233.51 at 34504.55, Nasdaq -1.61 at 13789.54, S&P -23.29 at 4395.35

[BRIEFING.COM] The S&P 500 is down 0.5%, and the Russell 2000 is down 0.3%.

One last look at the sectors shows energy (-2.8%) still leading the decline despite higher oil prices, while the consumer discretionary (+0.6%) and communication services (+0.2%) sectors continue to trade higher.

WTI crude futures settled higher by 2.6%, or $2.39, to $95.48/bbl amid the geopolitical uncertainty.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34738.06 -503.53 (-1.43%)
Nasdaq 13791.15 -394.49 (-2.78%)
SP 500 4418.64 -85.44 (-1.90%)
10-yr Note +32/32 1.921
NYSE Adv 910 Dec 2255 Vol 1.1 bln
Nasdaq Adv 1348 Dec 3007 Vol 5.1 bln

Industry Watch
Strong: Energy, Utilities
Weak: Information Technology, Consumer Discretionary, Communication Services

Moving the Market

-- Fears of Russian invasion of Ukraine

-- Treasury yields fall, oil prices rise

-- Hawkish Fed expectations tempered

Stocks tumble on geopolitical angst
11-Feb-22 16:20 ET
Dow -503.53 at 34738.06, Nasdaq -394.49 at 13791.15, S&P -85.44 at 4418.64

[BRIEFING.COM] The S&P 500 fell 1.9% on Friday amid burgeoning fears of a Russian invasion of Ukraine. The Nasdaq Composite underperformed with a 2.8% decline while the Dow Jones Industrial Average (-1.4%) and Russell 2000 (-1.0%) fared slightly better than the S&P 500.

PBS reported in the afternoon that the "U.S. believes Russian President Vladimir Putin has decided to invade Ukraine." National Security Advisor Jake Sullivan clarified that the White House doesn't think President Putin has made a final decision, but he did acknowledge a "distinct possibility" that Russia could invade Ukraine before the end of the Olympics.

The market, which was trading mixed, took a spill following the news with the mega-caps leading the retreat. The S&P 500 sliced through its 200-day moving average (4452) on closing basis with little interest to buy the dip given the uncertainty heading into the weekend.

Nine of the 11 S&P 500 sectors closed lower, including the information technology (-3.0%), consumer discretionary (-2.8%), and communication services (-2.5%) sectors with steep losses due to the weight of the mega-caps. The Vanguard Mega Cap Growth ETF (MGK 227.74, -7.20) fell 3.1%, versus a 1.3% decline in the Invesco S&P 500 Equal Weight ETF (RSP 155.32, -2.08).

Conversely, the energy sector rose 2.8% as oil prices climbed back above $93 per barrel ($93.09, +3.25, +3.6%). The utilities sector (+0.01%) was little changed.

Besides the higher oil prices, the geopolitical angst contributed to a decline in Treasury yields and an increase in the hedging premium (the CBOE Volatility Index rose 14.4% to 27.36). The 2-yr yield fell four basis points to 1.52%, and the 10-yr yield fell eight basis points to 1.96%. The U.S. Dollar Index rose 0.5% to 96.03.

Before the Russia-Ukraine news captured the headlines, commentary lingered on the Fed, specifically regarding tempered rate-hike fears. Bloomberg published a report suggesting that an emergency rate hike in between policy meetings was unlikely and that a 50-basis-point hike in March was not a sure bet.

Bloomberg cited less-hawkish Fed commentary in its report. San Francisco Fed President Daly said a half-point hike was not her preference, and Richmond Fed President Barkin said he was "open to it conceptually" but not yet convinced. Both Ms. Daly and Mr. Barkin are not voting members in the FOMC this year.

The probability for a half-point hike in March decreased to 50.2% from 93.8% yesterday, according to the CME FedWatch Tool.

Reviewing Friday's economic data:

The preliminary reading for the University of Michigan Consumer Sentiment Index for February was not good. It slumped to 61.7 (Briefing.com consensus 67.5) from the final reading of 67.2 for January. The February reading marks the lowest level for the index since November 2012.
The key takeaway from the report is that consumers see weakening personal financial prospects, largely due to inflation, which raises the specter of a downturn in consumer spending for an economy that derives close to 70% of GDP from consumer spending.

There is no economic data scheduled for Monday.

Dow Jones Industrial Average -4.4% YTD
S&P 500 -7.3% YTD
Russell 2000 -9.6% YTD
Nasdaq Composite -11.9% YTD

Crude futures settle above $93 per barrel
11-Feb-22 15:30 ET
Dow -451.31 at 34790.28, Nasdaq -382.41 at 13803.23, S&P -81.12 at 4422.96

[BRIEFING.COM] The S&P 500 is down 1.9% and is trading back below its 200-day moving average (4452).

One last look at the sectors shows information technology (-2.9%) down about 3% amid weakness in the semiconductor stocks (the Philadelphia Semiconductor Index is down 4.8%). Conversely, the energy sector (+2.6%) remains on top amid higher oil prices.

WTI crude futures settled higher by 3.6%, or $3.25, to $93.09/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35241.59 -526.47 (-1.47%)
Nasdaq 14185.64 -304.73 (-2.10%)
SP 500 4504.08 -83.10 (-1.81%)
10-yr Note -18/32 1.993

NYSE Adv 810 Dec 2435 Vol 1.0 bln
Nasdaq Adv 1452 Dec 2976 Vol 5.1 bln


Industry Watch
Strong: Energy, Materials, Financials

Weak: Information Technology, Consumer Discretionary, Real Estate, Utilities


Moving the Market
-- CPI data for January was hotter than expected, fuels rate-hike fears

-- Treasury yields spike, 10-yr yield breaks above 2.00%

-- Saint Louis Fed President Bullard (FOMC voter) said he's open to larger rate hikes and wants full-point increase by July 1

-- Better-than-expected earnings reports





Stocks fall amid rate-hike angst
10-Feb-22 16:20 ET

Dow -526.47 at 35241.59, Nasdaq -304.73 at 14185.64, S&P -83.10 at 4504.08
[BRIEFING.COM] The S&P 500 fell 1.8% on Wednesday, as rate-hike angst was fueled by the Consumer Price Index (CPI) for January and by comments from St. Louis Fed President Bullard (FOMC voter). The Nasdaq Composite (-2.1%), Dow Jones Industrial Average (-1.5%), and Russell 2000 (-1.6%) also suffered steep losses.

All 11 S&P 500 sectors closed lower with eight sectors losing at least 1.0%. The information technology (-2.8%) and real estate (-2.9%) sectors led the retreat, while the materials (-0.6%) and energy (-0.7%) sectors posted modest declines. Energy stocks received offsetting support from elevated oil prices ($89.84, +0.19, +0.2%).

Specifying the data, total CPI increased 0.6% month-over-month in January (Briefing.com consensus 0.5%), and so did core CPI (Briefing.com consensus 0.5%), which excludes food and energy. On a year-over-year basis, they were running at their highest levels since 1982 at 7.5% and 6.0%, respectively.

The report catalyzed losses in the equity futures market and the Treasury market, where yields jumped double-digit basis points. The 10-yr yield cracked above 2.00% and settled at 2.04%, or ten basis points above yesterday's settlement. The 2-yr yield spiked 22 basis points to 1.56%. The U.S. Dollar Index gained 0.2% to 95.69.

To the market's credit, each of the major indices quickly recovered their early declines (ranging from 0.8-1.9%) shortly after the open. The Russell 2000 even traded up as much as 1.0%.

The interest-rate action, however, seemed to keep a lid on the recovery effort, and the market rolled over after St. Louis Fed President Bullard told Bloomberg that he supports hiking rates by 100 basis points by July 1. The FOMC voter supported one hike being a 50-basis-point increase.

The CME FedWatch Tool was pricing in a 50% probability for a 50-bps hike in March after the CPI report. After Mr. Bullard's comments, the probability increased to 98.6% by the close, versus 24.0% yesterday.

Even though the market was already anticipating a series of rate hikes this year, the hawkish commentary raised concerns that the Fed's tightening plans could be more aggressive and sooner than expected because of persistent inflation pressures.

On a more positive note, the S&P 500 still closed 6.7% above its low on Jan. 24. The benchmark index has been range-bound this month, bouncing between its 200-day moving average (4451) and 50-day moving average (4611), trying to figure out its next move.

Separately, investors received a ton of earnings news. Dow components Walt Disney (DIS 152.16, +4.93, +3.4%) and Coca-Cola (KO 61.37, +0.33, +0.5%) closed higher after beating expectations, while Uber (UBER 37.75, -2.44, -6.1%) and Affirm (AFRM 58.82, -14.86, -21.2%) closed sharply lower following their reports. AFRM's results were leaked early.

Reviewing Thursday's economic data, which featured the Consumer Price Index for January:

Total CPI increased 0.6% month-over-month in January (Briefing.com consensus +0.5%) on the heels of an upwardly revised 0.6% (from 0.5%) for December. Core CPI, which excludes food and energy, was also up 0.6% month-over-month (Briefing.com consensus +0.5%) after increasing 0.6% in December. On a year-over-year basis, total CPI is up 7.5% -- the highest since February 1982 -- and core CPI is up 6.0% -- the highest since August 1982.
The key takeaway from the report should be obvious: the inflation picture is getting worse, making it clear yet again that the Fed is behind the curve in fighting inflation.
Initial jobless claims for the week ending February 5 decreased by 16,000 to 223,000 (Briefing.com consensus 234,000) while continuing claims for the week ending January 29 held steady at 1.621 million.
The key takeaway from the report is that it shows the labor market is back in a tighter spot with the peak of Omicron constraints having passed, and that may very well be a harbinger of ongoing wage inflation pressures for employers.

Looking ahead, investors will receive the preliminary University of Michigan Index of Consumer Sentiment for February on Friday.

Dow Jones Industrial Average -3.0% YTD
S&P 500 -5.5% YTD
Russell 2000 -8.9% YTD
Nasdaq Composite -9.3% YTD



Crude futures settle slightly higher
10-Feb-22 15:30 ET

Dow -531.53 at 35236.53, Nasdaq -289.40 at 14200.97, S&P -81.43 at 4505.75
[BRIEFING.COM] The S&P 500 is trading near session lows with a 1.6% decline. The Russell 2000 is down 1.2%.

One last look at the sectors losses ranging from 0.3% (materials) to 2.5% (information technology and real estate). The Philadelphia Semiconductor Index is another weak spot, showing a 2.8% decline.

WTI crude futures settled higher by 0.2%, or $0.19, to $89.84/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35768.06 +305.28 (0.86%)
Nasdaq 14490.37 +295.92 (2.08%)
SP 500 4587.18 +65.64 (1.45%)
10-yr Note +25/32 1.929
NYSE Adv 2302 Dec 896 Vol 901.9 mln
Nasdaq Adv 3128 Dec 1349 Vol 4.6 bln

Industry Watch
Strong: Communication Services, Real Estate, Information Technology, Materials
Weak: Consumer Staples

Moving the Market

-- Improved COVID-19 outlook

-- Hopeful-sounding Fed commentary on inflation

-- Market holds onto early gains

-- Nasdaq 100 closes above 200-day moving average (15048)

Market rallies amid optimistic mindset
09-Feb-22 16:20 ET
Dow +305.28 at 35768.06, Nasdaq +295.92 at 14490.37, S&P +65.64 at 4587.18

[BRIEFING.COM] The S&P 500 gained 1.5% on Wednesday, as investors were encouraged about the COVID-19 outlook and the ability for the market to hold onto early gains. The Nasdaq Composite (+2.1%) and Russell 2000 (+1.9%) each rose about 2.0% while the Dow Jones Industrial Average rose 0.9%.

Briefly, a growing list of U.S. states included plans to relax mask mandates amid improving COVID-19 trends and an observation from Dr. Fauci that the U.S. is heading out of the "full blown" pandemic phase. These developments benefited the cyclical stocks, but buying interest was really broad-based in a sideways-trading session.

All 11 S&P 500 sectors closed higher after registering most, if not all, of their gains at the open. The communication services (+2.5%), real estate (+2.4%), information technology (+2.3%), and materials (+2.1%) sectors gained more than 2.0%. The consumer staples sector (+0.02%) closed fractionally higher.

Growth stocks appeared to benefit from a decline in long-term interest rates, although they outperformed yesterday even when rates pushed higher. The 10-yr yield decreased three basis points to 1.93% amid a strong $37 billion 10-yr note auction and hopeful-sounding commentary from Fed officials that inflation pressures could ease this year.

Atlanta Fed President Bostic (not an FOMC voter) told CNBC that there's some evidence that inflation isn't getting worse. Cleveland Fed President Mester (FOMC voter) said in a speech that she expects inflation to moderate this year on the condition that the FOMC takes appropriate action.

The 2-yr yield settled unchanged at 1.34%, as the market continued to expect five rate hikes from the Fed despite Mr. Bostic's expectations for three to four rate hikes this year. The U.S. Dollar Index declined 0.1% to 95.54. WTI crude futures increased 0.3%, or $0.22, to $89.65/bbl.

Separately, the Nasdaq 100 (+2.1%) closed above its 200-day moving average (15,048) after seeing technical resistance at that level earlier in the day.

In earnings news, Lyft (LYFT 44.00, +2.80, +6.8%) issued downside Q1 revenue guidance, but investors overlooked the guidance in favor of the improved COVID-19 perspective. Shares of CVS Health (CVS 104.79, -6.04, -5.5%) fell 5.5% after reducing the low end of its FY22 cash flow from operations guidance.

Reviewing Wednesday's economic data:

Wholesale inventories increased 2.2% m/m in December (Briefing.com consensus 2.0%) following a revised 1.7% increase (from 1.4%) in November.
The weekly MBA Mortgage Applications Index fell 8.1% following a 12.0% increase in the prior week.

Looking ahead, investors will receive the Consumer Price Index for January, the weekly MBA Mortgage Applications Index, and the Treasury Budget for January on Thursday.

Dow Jones Industrial Average -1.6% YTD
S&P 500 -3.8% YTD
Russell 2000 -7.2% YTD
Nasdaq Composite -7.4% YTD

Crude futures settle slightly higher
09-Feb-22 15:30 ET
Dow +295.38 at 35758.16, Nasdaq +255.43 at 14449.88, S&P +60.27 at 4581.81

[BRIEFING.COM] The S&P 500 is up 1.3% and while the Nasdaq 100 (+1.7%) continues to outperform, the tech-heavy index has faced some resistance at its 200-day moving average (15048).

One last look at the sectors shows real estate (+2.3%), communication services (+2.2%), and materials (+2.1%) up more than 2.0% while the consumer staples sector (+0.02%) trades near its flat line.

WTI crude futures settled higher by 0.3%, or $0.22, to $89.65/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35462.78 +371.65 (1.06%)
Nasdaq 14194.45 +178.79 (1.28%)
SP 500 4521.54 +37.67 (0.84%)
10-yr Note -25/32 1.962
NYSE Adv 1943 Dec 1313 Vol 890.4 mln
Nasdaq Adv 2864 Dec 1701 Vol 4.2 bln

Industry Watch
Strong: Materials, Consumer Discretionary, Financials, Information Technology
Weak: Energy, Communication Services, Real Estate

Moving the Market

-- Stocks drift higher in relatively broad-based advance, excluding energy stocks

-- 10-yr yield settles at 1.95%, oil prices dip below $90/bbl

-- Amgen (AMGN) jumps 8% on pleasing earnings news

Stocks drift higher along with interest rates
08-Feb-22 16:20 ET
Dow +371.65 at 35462.78, Nasdaq +178.79 at 14194.45, S&P +37.67 at 4521.54

[BRIEFING.COM] The S&P 500 gained 0.8% on Tuesday, as the market drifted higher while investors digested another increase in interest rates and individual storylines. The Dow Jones Industrial Average (+1.1%), Nasdaq Composite (+1.3%), and Russell 2000 (+1.6%) each outperformed the benchmark index.

Eight of the 11 S&P 500 sectors closed higher, including five that gained at least 1.0%. The materials sector (+1.6%) was the top-performer, and the heavily-weighted information technology sector (+1.3%) wasn't too far behind.

The energy sector (-2.1%), on the other hand, declined 2% as oil prices fell below $90 per barrel ($89.43, -1.84, -2.0%) amid speculation that the U.S. could allow Iran to increase its oil exports. Reports indicated that U.S.-Iran nuclear talks have made progress.

Regarding interest rates, the 10-yr yield came within three basis points of the 2.00% level before setting at 1.95%, or four basis points above yesterday's settlement. The 2-yr yield rose five basis points to 1.34% amid lingering expectations for five rate hikes this year. The U.S. Dollar Index increased 0.2% to 95.60.

Encouragingly, the higher rates benefited the financials sector (+1.4%) without hurting the growth stocks. The Russell 3000 Growth Index rose 1.1%, besting the 0.7% gain in the Russell 3000 Value Index. For what it's worth, the S&P 500 closed essentially at yesterday's high (4521.86).

Amgen (AMGN 241.01, +17.48, +7.8%), meanwhile, rose 8% after the Dow component reported better-than-expected earnings results along with encouraging EPS guidance. Pfizer (PFE 51.70, -1.51, -2.8%) fell 3% after issuing disappointing full-year guidance.

Peloton (PTON 37.27, +7.52, +25.3%) also reported downside guidance in addition to below-consensus fiscal Q2 results, but shares jumped 25% after the company announced a CEO change and cost-cutting measures. Shareholders were hopeful that the company could turn itself around or at least put itself in a more valuable position for a takeover.

In M&A news, Mandiant (MNDT 17.75, +2.69, +17.9%) spiked 18% after Bloomberg reported that Microsoft (MSFT 304.56, +3.61, +1.2%) might bid for the company. NVIDIA (NVDA 251.08, +3.80, +1.5%) officially terminated its acquisition of Arm Holdings.

Reviewing Tuesday's economic data:

The December Trade Balance Report showed a widening in the trade deficit to $80.7 billion (Briefing.com consensus -$79.6 billion) from an upwardly revised $79.3 billion (from -$80.2 billion) in November. December exports were $3.4 billion more than November exports while December imports were $4.8 million more than November imports.
The key takeaway from the report is that the Omicron variant didn't seriously disrupt trade activity in December, although there were signs of a slowdown in China as U.S. goods exports there decreased by $2.2 billion.
The NFIB Small Business Optimism Index for January decreased to 97.1 from 98.9 in December.

Looking ahead, investors will receive Wholesale Inventories for December and the weekly MBA Mortgage Applications Index on Wednesday.

Dow Jones Industrial Average -2.4% YTD
S&P 500 -5.1% YTD
Russell 2000 -8.9% YTD
Nasdaq Composite -9.3% YTD

Crude futures dip below $90 per barrel amid U.S.-Iran talks
08-Feb-22 15:30 ET
Dow +332.91 at 35424.04, Nasdaq +113.36 at 14129.02, S&P +29.24 at 4513.11

[BRIEFING.COM] The S&P 500 is up 0.6% after receiving modest bump earlier this hour on no specific news.

One last look at the sectors shows materials (+1.4%), financials (+1.4%), consumer discretionary (+1.3%), and information technology (+1.0%) still trading higher by at least 1.0%. Conversely, the energy sector (-2.5%) remains an eye sore with a 2.5% decline due to the decline in oil prices.

WTI crude futures settled lower by 2.0%, or $1.84, to $89.43/bbl amid reports indicating that U.S.-Iran nuclear talks have made progress, raising the possibility that Iran would be allowed to increase its oil exports.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35091.13 +1.39 (0.00%)
Nasdaq 14015.66 -82.34 (-0.58%)
SP 500 4483.87 -16.66 (-0.37%)
10-yr Note -1/32 1.930
NYSE Adv 1706 Dec 1539 Vol 881.6 mln
Nasdaq Adv 2691 Dec 1876 Vol 4.2 bln

Industry Watch
Strong: Energy, Financials, Industrials
Weak: Communication Services, Information Technology

Moving the Market

-- Market slips into the close on no specific news

-- Lack of trading conviction

-- General preference for value/cyclical stocks over growth stocks

Stocks close mixed amid soft finish
07-Feb-22 16:20 ET
Dow +1.39 at 35091.13, Nasdaq -82.34 at 14015.66, S&P -16.66 at 4483.87

[BRIEFING.COM] The S&P 500 declined 0.4% on Monday amid some slippage in the last 45 minutes of action, which erased a 0.5% gain for the benchmark index. The Nasdaq Composite fell 0.6% after being up 1.0% intraday. The Dow Jones Industrial Average (unch) closed flat, while the Russell 2000 outperformed with a 0.5% gain.

For most of the day, there wasn't a lot of trading conviction as the major indices, and most S&P 500 sectors, wavered between gains and losses. Investors continued to contemplate whether the market bottomed on Jan. 24 in the face of rising rates and the Fed's tightening plans.

Trading conviction was reserved for the energy (+1.3%) and communication services (-2.3%) sectors, which diverged in opposite directions, as well as individual story stocks.

Energy stocks outperformed as oil prices stayed above $90 per barrel ($91.27, -1.03, -1.1%), although WTI crude futures did settle on a lower note today. The communication services sector was dragged lower by weakness in Alphabet (GOOG 2778.76, -81.56, -2.9%) and Meta Platforms (FB 224.91, -12.18, -5.1%).

Generally, there was a preference for value/cyclical stocks over the growth stocks. The Invesco S&P 500 Equal Weight ETF (RSP 155.83, +0.10) increased 0.1% -- as did the Russell 3000 Value Index (+0.1%) -- while the Vanguard Mega Cap Growth ETF (MGK 233.18, -2.08) fell 0.9%.

One of today's bigger stories was the airline merger between Spirit (SAVE 25.46, +3.73, +17.2%) and Frontier (ULCC 12.82, +0.43, +3.5%), valued at $6.6 billion in cash and stock, including net debt and operating leases. On a related note, both companies reported better-than-expected EPS results.

On Semiconductor (ON 62.26, +4.84, +8.4%) and Tyson Foods (TSN 99.09, +10.80, +12.2%) also exceeded earnings expectations while Peloton (PTON 29.75, +5.15, +20.9%) jumped 21% on reports indicating that Amazon.com (AMZN 3158.71, +5.92, +0.2%) and Nike (NKE 145.14, -0.25, -0.2%) are interested in acquiring the company.

U.S. Treasury yields settled slightly lower amid a warning from National Security Adviser Jake Sullivan that Russia could invade Ukraine "any day now." The 2-yr yield declined three basis points to 1.29%, and the 10-yr yield declined one basis point to 1.92%. The U.S. Dollar Index declined 0.1% to 95.42.

Reviewing Monday's economic data:

Consumer credit increased by $18.9 billion in December (Briefing.com consensus $25.0 billion). The prior month saw a downward revision to $38.9 bln from $39.9 bln.
The key takeaway from the report is that the increase in consumer credit in December was driven mostly by an expansion in nonrevolving credit.

Looking ahead, investors will receive the Trade Balance report for December on Tuesday.

Dow Jones Industrial Average -3.4% YTD
S&P 500 -5.9% YTD
Nasdaq Composite -10.4% YTD
Russell 2000 -10.4% YTD

Crude futures settle lower but stay above $90 per barrel
07-Feb-22 15:30 ET
Dow +132.08 at 35221.82, Nasdaq -7.18 at 14090.82, S&P +3.87 at 4504.40

[BRIEFING.COM] The S&P 500 is up 0.1% in a range-bound session while the Nasdaq (-0.1%) has dipped back below its flat line.

One last look at the sector standings shows energy (+2.2%) up 2% and is the only sector up more than 1.0%. The communication services sector (-1.6%) is the only sector trading lower, and it's down 1.6% amid weakness in Alphabet (GOOG 2800.74, -59.58, -2.1%) and Meta Platforms (FB 227.36, -9.78, -4.1%).

WTI crude futures settled lower by 1.1%, or $1.03, to $91.27/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35089.74 -21.42 (-0.06%)
Nasdaq 14098.00 +219.19 (1.58%)
SP 500 4500.53 +23.09 (0.52%)
10-yr Note -6/32 1.903
NYSE Adv 1431 Dec 1753 Vol 943.8 mln
Nasdaq Adv 2752 Dec 1599 Vol 4.0 bln

Industry Watch
Strong: Consumer Discretionary, Energy, Financials
Weak: Materials, Industrials, Real Estate, Utilities

Moving the Market

-- January employment report showed surprisingly strong jobs growth and higher-than-expected wage gains

-- Amazon.com (AMZN) and Snap (SNAP) provide investors a huge relief with earnings news

-- Increased expectations for the Fed to hike rates by 50 basis points in March

-- Treasury yields rise and oil prices top $92 per barrel

S&P 500 closes higher amid dueling trading narratives
04-Feb-22 16:20 ET
Dow -21.42 at 35089.74, Nasdaq +219.19 at 14098.00, S&P +23.09 at 4500.53

[BRIEFING.COM] The S&P 500 gained 0.5% on Friday in a session featuring earnings relief from Amazon.com (AMZN 3152.79, +375.88, +13.5%) and Snap (SNAP 38.75, +14.25, +58.2%), a surprising January employment report, rising Treasury yields, and uncomfortably high oil prices ($92.30/bbl, +2.08, +2.3%).

The Russell 2000 (+0.6%) kept pace with the benchmark index while the Nasdaq Composite (+1.6%) outperformed and the Dow Jones Industrial Average (-0.1%) closed lower. The market was contending with dueling trading narratives throughout the day.

The first trading narrative was that the bullish earnings reactions in Amazon and Snap suggested that Meta Platform's (FB 237.09, -0.67, -0.3%) earnings disappointment was more a company-specific issue. AMZN shares rose 13.5%, and SNAP shares rose nearly 60.0%.

Amazon carried the S&P 500 consumer discretionary sector (+3.7%) to the top of the sector leaderboard. The financials (+1.7%) and energy (+1.6%) sectors followed suit, while the materials (-1.7%), consumer staples (-1.2%), and industrials (-1.1%) sectors were among six sectors that closed lower.

The second trading narrative was that the January employment report, which included surprisingly strong jobs growth and higher-than-expected wage gains, would force the Fed to be even more aggressive with rate hikes. That could explain the mixed sector performances, as well as the 0.1% decline in the S&P 500 Equal Weight Index.

Specifying the jobs data, nonfarm payrolls increased by 467,000 (Briefing.com consensus 180,000), and private sector payrolls increased by 444,000 (Briefing.com consensus 160,000), which caught many people off guard given the disappointing ADP Employment Change report earlier in the week. December payrolls growth saw sizable upwards revisions.

In addition, the labor force participation rate increased to 62.2% from 61.9% in December, and average hourly earnings increased 0.7% (Briefing.com consensus 0.5%). The unemployment rate was 4.0% (Briefing.com consensus 3.9%), versus 3.9% in December.

Accordingly, the 2-yr yield rose 13 basis points to 1.32%, and the 10-yr yield rose ten basis points to 1.93%. The U.S. Dollar Index increased 0.1% to 95.44. Regarding the Fed's policy meeting in March, the CME FedWatch Tool increased the probability for a 50-basis-point rate hike in that meeting to 36.6% from 14.3% yesterday.

In other earnings news, Pinterest (PINS 27.25, +2.74, +11.2%) was another company that provided better-than-feared earnings results, while Ford Motor (F 17.96, -1.93, -9.7%) and Clorox (CLX 141.41, -23.93, -14.5%) disappointed shareholders with a pair of EPS misses.

Reviewing the Employment Situation report in more depth:

January payrolls were not only strong, they were accompanied by large upward revisions to the payrolls data for December and November. The January employment report was also accompanied by a big pickup in the year-over-year change in average hourly earnings and a nice uptick in the labor force participation rate.
January nonfarm payrolls increased by 467,000 (Briefing.com consensus 180,000). December nonfarm payrolls revised to 510,000 from 199,000.
January private sector payrolls increased by 444,000 (Briefing.com consensus 160,000). December private sector payrolls revised to 503,000 from 211,000.
January unemployment rate was 4.0% (Briefing.com consensus 3.9%), versus 3.9% in December.
January average hourly earnings increased 0.7% (Briefing.com consensus 0.5%) versus a downwardly revised 0.5% increase (from 0.6%) in December.
The average workweek in January was 34.5 hours (Briefing.com consensus 34.7), versus 34.7 hours in December.
The labor force participation rate increased to 62.2% from 61.9% in December.
The employment-population ratio rose to 59.7% from 59.5% in December.
The key takeaway from the report is that it will inflame concerns about the Fed being behind the curve in fighting inflation.

Looking ahead, investors will receive Consumer Credit for December on Monday.

Dow Jones Industrial Average -3.4% YTD
S&P 500 -5.6% YTD
Nasdaq Composite -9.9% YTD
Russell 2000 -10.8% YTD

Crude futures settle above $92 per barrel
04-Feb-22 15:30 ET
Dow +185.49 at 35296.65, Nasdaq +311.59 at 14190.40, S&P +53.91 at 4531.35

[BRIEFING.COM] The S&P 500 is up 1.3% as the market continues to push higher with no specific catalyst behind the recent move.

One last look at the sectors shows mixed results. The consumer discretionary (+4.7%), financials (+2.4%), and energy (+2.3%) sectors are up between 2-5%, while the consumer staples (-0.7%), materials (-0.9%), and industrials (-0.4%) sectors underperform in the red.

WTI crude futures settled higher by 2.3%, or $2.08, to $92.30/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35629.33 +224.09 (0.63%)
Nasdaq 14417.54 +71.54 (0.50%)
SP 500 4589.38 +42.84 (0.94%)
10-yr Note +2/32 1.774
NYSE Adv 1416 Dec 1827 Vol 986.5 mln
Nasdaq Adv 1571 Dec 2944 Vol 4.5 bln

Industry Watch
Strong: Communication Services, Consumer Staples, Real Estate
Weak: Energy, Financials, Consumer Discretionary

Moving the Market

-- S&P 500 trades at session highs

-- Alphabet (GOOG) reports better-than-expected earnings results and announces 20-for-1 stock split

-- ADP Employment Change report showed unexpected decline in private-sector payrolls in January

-- U.S. to send approximately 3,000 additional troops closer to Ukraine

Alphabet leads S&P 500 higher
02-Feb-22 16:15 ET
Dow +224.09 at 35629.33, Nasdaq +71.54 at 14417.54, S&P +42.84 at 4589.38

[BRIEFING.COM] The S&P 500 advanced 0.9% on Wednesday, driven by Alphabet (GOOG 2960.73, +203.16, +7.4%) following its earnings report and helped by lingering rebound momentum. The Dow Jones Industrial Average (+0.6%) and Nasdaq Composite (+0.5%) followed suit, while the Russell 2000 fell 1.0%.

Shares of Alphabet gained 7% after the company reported better-than-expected Q4 results and announced a 20-for-1 stock split. The latter generated speculation of greater retail interest in the stock and a potential inclusion in the Dow at some point.

The S&P 500 communication services sector, where Alphabet resides, climbed 3.1% to the top of the sector rankings. The other sectors also closed higher, except for consumer discretionary (-0.5%), which included earnings-related weakness in Starbucks (SBUX 97.73, -1.03, -1.1%) and General Motors (GM 53.50, -0.57, -1.1%).

Despite the strong performance in the S&P 500, and the gains in ten of its 11 sectors, there wasn't the same level of bullishness from the prior days. There were more declining issues than advancing issues at both the NYSE and Nasdaq, and PayPal (PYPL 132.57, -43.23, -24.6%) plunged 25% on disappointing earnings results/guidance.

That might have been due to profit-taking pressure on the recognition that the major indices have bounced strongly off their January lows, pushing the Fed's hawkish policy stance to the background of the trading narrative.

In addition, there were some misgivings about the U.S. sending 3,000 troops to NATO countries near Ukraine and the disappointing ADP Employment Change report. ADP estimated a net-loss of 301,000 jobs to private-sector payrolls in January (Briefing.com consensus +220,000), lowering market expectations for the Employment Situation report on Friday.

The market hung in there, though, and after dipping into negative territory in early action, the large-cap indices drifted higher the rest of the session. Advanced Micro Devices (AMD 122.76, +5.98, +5.1%) was another earnings standout.

The Treasury market saw modest demand from buyers amid the geopolitical risks and negative employment data. The 2-yr yield decreased one basis point to 1.15%, and the 10-yr yield decreased two basis points to 1.77%. The U.S. Dollar Index fell 0.4% to 95.99 amid relative strength in the euro, which was a byproduct of ECB rate-hike expectations.

WTI crude futures settled little changed ($88.17/bbl, -0.04, -0.1%). In related news, OPEC+ reaffirmed its decision to increase production by 400,000 barrels per day in March, and the EIA reported an unexpected draw in weekly crude inventories (1.05 million).

Reviewing Wednesday's economic data:

The ADP Employment Change report estimated a net-loss of 301,000 jobs to private-sector payrolls in January (Briefing.com consensus +220,000). The increase in December was downwardly revised to 776,000 from 807,000.
The weekly MBA Mortgage Applications Index rose 12.0% following a 7.1% decline in the prior week.

Looking ahead to Thursday, investors will receive the ISM Non-Manufacturing Index for January, the weekly Initial and Continuing Claims report, Factory Orders for December, preliminary Q4 Productivity and Unit Labor Costs, and the final IHS Markit Services PMI for January.

Dow Jones Industrial Average -2.0% YTD
S&P 500 -3.7% YTD
Nasdaq Composite -7.9% YTD
Russell 2000 -9.6% YTD

Crude futures settle slightly lower amid OPEC+ decision, EIA data
02-Feb-22 15:30 ET
Dow +214.74 at 35619.98, Nasdaq +54.25 at 14400.25, S&P +39.36 at 4585.90

[BRIEFING.COM] The S&P 500 is up 1.0% as the rebound momentum persists. The benchmark index is now up 8.6% since its low on Jan. 24.

One last look at the sector performances shows communication services (+3.5%), real estate (+1.7%), health care (+1.5%), and utilities (+1.4%) with gains over 1.0%. The consumer discretionary sector (-0.6%) underperforms in negative territory.

WTI crude futures settled lower by 0.1%, or $0.04, to $88.17/bbl. In related news, OPEC+ reaffirmed its decision to increase production by 400,000 barrels per day in March while the EIA reported an unexpected draw in weekly crude inventories (1.05 million).

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35405.24 +273.38 (0.78%)
Nasdaq 14346.00 +106.12 (0.75%)
SP 500 4546.54 +30.99 (0.69%)
10-yr Note -3/32 1.815
NYSE Adv 2403 Dec 878 Vol 1.0 bln
Nasdaq Adv 3366 Dec 1192 Vol 4.5 bln

Industry Watch
Strong: Energy, Materials, Financials, Industrials
Weak: Utilities, Real Estate, Consumer Staples

Moving the Market

-- Another strong finish into the close, as market awakens from consolidation activity

-- UPS (UPS) and Exxon Mobil (XOM) rise on pleasing earnings news

-- ISM Manufacturing Index decelerates in January while Prices component increases

Rebound rally extends into February
01-Feb-22 16:15 ET
Dow +273.38 at 35405.24, Nasdaq +106.12 at 14346.00, S&P +30.99 at 4546.54

[BRIEFING.COM] The S&P 500 gained 0.7% on Tuesday, extending its rebound rally into February amid another strong finish into the close. The Nasdaq Composite (+0.8%) and Dow Jones Industrial Average (+0.8%) kept pace with the benchmark index, while the Russell 2000 rose 1.1%.

There was a cyclical tilt to the session, evident by the leadership positions in the S&P 500 energy (+3.5%), materials (+1.7%), financials (+1.4%), and industrials (+1.4%) sectors. Conversely, the defensive-oriented utilities (-1.3%), real estate (-0.7%), and consumer staples (-0.1%) sectors closed lower.

For most of the session, the market operated in consolidation mode as investors digested better-than-expected earnings reports from Exxon Mobil (XOM 80.83, +4.87, +6.4%) and UPS (UPS 230.69, +28.48, +14.1%). Alphabet (GOOG 2757.57, +43.60, +1.6%) held firm in front of its earnings report after the close.

In addition, the ISM Manufacturing Index for January was another report in the mix. The headline index decelerated to 57.6% (Briefing.com consensus 57.5%) from 58.8% in December amid persistent Omicron-related disruptions while the Prices component of the report increased to 76.1% from 68.2%.

Stocks briefly dipped to session lows in the wake of the ISM report while Treasury yields pushed to session highs, presumably because the pricing pressures supported the Fed's case to be more aggressive in tightening policy. Evidently, the market stomached any hawkish interpretations today.

First-of-the-month inflows might have played a supportive role, but more encouragingly, investors may have liked that the market staved off the temptation to sell into the recent strength. Buying interest really accelerated in the last hour of action on no specific news, resembling a fear of getting left behind in the rebound rally.

Treasury yields ended the session mostly lower, although the 2-yr yield settled unchanged at 1.16%. The 10-yr yield increased two basis points to 1.80%. The U.S. Dollar Index decreased 0.3% to 96.29. WTI crude futures edged higher by 0.1%, or $0.05, to $88.21/bbl.

Separately, AT&T (T 24.42, -1.08, -4.2%) was excluded from the advance with a 4% decline after providing disappointing dividend details surrounding its WarnerMedia spinoff. The company announced a dividend of $1.11 per share, putting it on the low end of the payout range previously forecasted.

Reviewing Tuesday's economic data:

The January ISM Manufacturing Index dipped to 57.6% (Briefing.com consensus 57.5%) from an upwardly revised 58.8% (from 58.7%) in December. A number above 50.0% is indicative of expansion. January marked the 20th straight month of expansion for the manufacturing sector, albeit at the slowest pace since September 2020 as the effects of the Omicron variant impacted production.
The key takeaway from the report is the understanding that pricing pressures worsened in January as supply chain problems persisted. This understanding will contribute to investors' angst about the Fed pivoting to a more hawkish mindset as it works to tamp down inflation pressures.
Total construction spending increased 0.2% month-over-month in December (Briefing.com consensus +0.6%) following an upwardly revised 0.6% increase (from 0.4%) in November. That was the slowest pace of increase since July 2021. Total private construction increased 0.7% month-over-month while total public construction spending decreased 1.6%. On a year-over-year basis, total construction spending was up 9.0%.
The key takeaway from the report is the strength seen in new single-family construction, which is a reflection of the ongoing demand for new homes amid a scarcity of supply in the existing home market.
Job openings increased to 10.925 million in December from a revised 10.775 million (from 10.562 million) in November.
The final IHS Markit Manufacturing PMI for January decreased to 55.5 from 57.7 in the preliminary reading.

Looking ahead, investors will receive the ADP Employment Change report for January and the weekly MBA Mortgage Applications Index on Wednesday.

Dow Jones Industrial Average -2.6% YTD
S&P 500 -4.6% YTD
Nasdaq Composite -8.3% YTD
Russell 2000 -8.7% YTD

Crude futures settle fractionally higher
01-Feb-22 15:30 ET
Dow +210.38 at 35342.24, Nasdaq +49.95 at 14289.83, S&P +21.48 at 4537.03

[BRIEFING.COM] The S&P 500 is up 0.5% to trade at session highs. The market has seen a modest up on no specific news.

One last look at the sector rankings shows energy (+3.5%), materials (+1.7%), financials (+1.4%), and industrials (+1.3%) outperforming with decent gains, while the utilities (-1.1%), real estate (-0.4%), and information technology (-0.2%) sectors underperform with modest declines.

WTI crude futures settled higher by 0.1%, or $0.05, to $88.21/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35131.86 +406.39 (1.17%)
Nasdaq 14239.88 +469.31 (3.41%)
SP 500 4515.55 +83.70 (1.89%)
10-yr Note -3/32 1.804
NYSE Adv 2673 Dec 621 Vol 1.4 bln
Nasdaq Adv 3564 Dec 805 Vol 5.0 bln

Industry Watch
Strong: Consumer Discretionary, Information Technology, Communication Services
Weak: Energy, Consumer Staples

Moving the Market

-- Growth stocks pace rebound rally

-- Month-end rebalancing activity

-- S&P 500 reclaims 200-day moving average (4437)

Stocks end January on a high note
31-Jan-22 16:15 ET
Dow +406.39 at 35131.86, Nasdaq +469.31 at 14239.88, S&P +83.70 at 4515.55

[BRIEFING.COM] The S&P 500 rose 1.9% on Monday in a steady advance paced by the growth stocks. The Nasdaq Composite (+3.4%) and Russell 2000 (+3.1%) outperformed with gains over 3.0%, while the Dow Jones Industrial Average underperformed on a relative basis with a 1.2% gain.

There weren't any specific macro catalysts today. Instead, the market received support from month-end rebalancing activity that disproportionately benefited growth stocks after a dismal January, an improving technical posture as the S&P 500 reclaimed its 200-day moving average (4437), and a fear of missing out on further gains.

All 11 S&P 500 sectors closed in positive territory amid another strong finish. The consumer discretionary (+3.8%), information technology (+2.7%), and communication services (+2.4%) sectors, which contain the mega-caps, finished atop the standings while the energy sector increased just 0.4%.

The rebalancing into growth stocks was further aided by positive-minded analyst recommendations, specifically in Tesla (TSLA 936.72, +90.37, +10.7%), Netflix (NFLX 427.14, +42.78, +11.1%), Spotify (SPOT 196.26, +23.28, +13.5%), and Beyond Meat (BYND 65.13, +8.59, +15.2%), which were all upgraded to the equivalent of Buy ratings.

Citrix Systems (CTXS 101.94, -3.61, -3.4%) was an exception after announcing a deal to be taken private for $16.5 billion, or $104 per share, in cash. Shareholders were disappointed by the purchase price, which was less than the closing price last Friday.

Separately, Atlanta Fed President Bostic (not an FOMC voter) said a 50-basis-point rate-hike in March is a possibility but not his preference. Kansas City Fed President George (FOMC voter) commented that gradual rate rises are always preferred while Richmond Fed President Barkin (not an FOMC voter) told CNBC that the speed at which the Fed hikes rates depends on the economy.

The Treasury market, meanwhile, was much more reserved than the stock market. The 2-yr yield decreased one basis point to 1.16%, and the 10-yr yield was unchanged at 1.78%. The U.S. Dollar Index pulled back 0.7% to 96.63. WTI crude futures settled above $88 per barrel ($88.16, +1.42, +1.6%).

Overall, today was a light news day, at least compared to the rest of the week, which will feature more mega-cap earnings, key manufacturing and employment data, and central bank meetings in Europe. Rather than shying away from risk assets in front of these events, investors were steadfast in the rebound pursuit.

Monday's economic data was limited to the Chicago PMI for January, which increased to 65.2 (Briefing.com consensus 62.5) from a revised 64.3 (from 63.1) in December. Looking ahead, investors will receive the ISM Manufacturing Index for January, Construction Spending for December, and the JOLTS - Job Openings report for December on Tuesday.

Dow Jones Industrial Average -3.3% YTD
S&P 500 -5.3% YTD
Nasdaq Composite -9.0% YTD
Russell 2000 -9.7% YTD

Crude futures settle above $88 per barrel
31-Jan-22 15:30 ET
Dow +191.53 at 34917.00, Nasdaq +323.51 at 14094.08, S&P +50.70 at 4482.55

[BRIEFING.COM] The S&P 500 is up 1.2% and has seen some minor volatility in the past 30 minutes.

One last look at the sectors shows consumer discretionary (+3.0%) still in the lead with a 3% gain, while the consumer staples sector (+0.2%) continues to cling onto a slim gain. All 11 sectors are trading higher.

WTI crude futures settled higher by 1.6%, or $1.42, to $88.16/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34725.47 +564.69 (1.65%)
Nasdaq 13770.57 +417.79 (3.13%)
SP 500 4431.85 +105.34 (2.43%)
10-yr Note +2/32 1.783
NYSE Adv 2216 Dec 1043 Vol 1.1 bln
Nasdaq Adv 2807 Dec 1487 Vol 4.9 bln

Industry Watch
Strong: Information Technology, Communication Services, Real Estate
Weak: Energy

Moving the Market

-- Stocks surge into the close on no specific news

-- Apple (AAPL) and Visa (V) rally on better-than-expected earnings reports

-- Month-end rebalancing activity, bargain-hunting mindset, fear of missing out, lower interest rates

-- PCE inflation data was roughly in-line with expectations, remained elevated

Apple steers rebound rally
28-Jan-22 16:15 ET
Dow +564.69 at 34725.47, Nasdaq +417.79 at 13770.57, S&P +105.34 at 4431.85

[BRIEFING.COM] The S&P 500 rose 2.4% on Friday, overcoming an early 0.8% decline, as the market rallied into the close on no specific news while Apple (AAPL 170.33, +11.11, +7.0%) steered the effort following its better-than-expected earnings report. Shares of Apple rose 7%.

The Nasdaq Composite gained 3.1%, the Dow Jones Industrial Average gained 1.7%, and the Russell 2000 gained 1.9%.

Ten of the 11 S&P 500 sectors closed higher, paced by the information technology sector (+4.3%), which also featured a 10% earnings-driven gain in Visa (V 228.00, +21.85, +10.6%). The energy sector (-0.6%) was the lone exception, pressured by an EPS miss from Chevron (CVX 130.67, -4.70, -3.5%).

While Apple deserves credit today, it didn't have the level of pull on the market as some would have liked. At one point, declining issues were up by more than a 2:1 margin at the NYSE and Nasdaq, and even the technology sector slipped into negative territory amid early weakness in the semiconductor stocks.

That might have been due to underlying concerns about the Fed slowing down growth with tighter monetary policy, as well as more companies like Caterpillar (CAT 201.16, -11.01, -5.2%) and Western Digital (WDC 49.90, -3.94, -7.3%) drawing attention to higher costs and supply chain issues. In other words, Apple was more a company-specific event.

Nevertheless, the market held it together, further supported by month-end rebalancing activity, a bargain-hunting mindset, lower interest rates, a fear of missing out on further rebound gains. Treasury yields declined following the release of inflation reports that were roughly in-line with expectations.

Briefly, the PCE Price Index increased 0.4% m/m in December, as expected, and was up 5.8% yr/yr. The Q4 Employment Cost Index increased 1.0% (Briefing.com consensus 1.1%) following a 1.3% increase in the third quarter. Despite hope that inflation rates could soon ease, the PCE data still supported the Fed's case to be more assertive in tightening policy.

The 2-yr yield decreased two basis points to 1.17%, and the 10-yr yield decreased three basis points to 1.78%. The U.S. Dollar Index was little changed at 97.24. WTI crude futures increased just 0.1%, or $0.12, to $86.74/bbl.

Robinhood Markets (HOOD 12.73, +1.12, +9.7%), which was down 14% at the open on disappointing earnings news/guidance, turned around with the broader market and closed higher by 10% -- further exemplifying the volatile conditions in the market.

Interestingly, the S&P 500 closed three points below its 200-day moving average (4435).

Reviewing Friday's economic data:

Personal income increased 0.3% month-over-month in December (Briefing.com consensus 0.5%) while personal spending declined 0.6% (Briefing.com consensus -0.6%). The PCE Price Index increased 0.4% month-over-month, as expected, and was up 5.8% year-over-year versus 5.7% in November. The core PCE Price Index jumped 0.5% (Briefing.com consensus 0.4%) and was up 4.9% year-over-year versus 4.7% in November.
The key takeaway from the report is the recognition that the inflation rate in the Fed's preferred inflation gauge is still rising, which should of course mean that the target range for the fed funds rate should soon be doing the same.
The final January reading for the University of Michigan Index of Consumer Sentiment dropped to 67.2 (Briefing.com consensus 68.5) from the preliminary reading of 68.8. The final December reading was 70.6. The January reading is the lowest level for the index since November 2012.
The key takeaway from the report is that consumer sentiment is dropping as inflation pressures increase, raising concerns about falling real incomes that are apt to translate into lower levels of spending.
The Q4 Employment Cost Index increased 1.0% (Briefing.com consensus 1.1%) for the three-month period ending in December 2021 following a 1.3% increase in the third quarter. Wages and salaries, which account for about 70% of compensation costs, increased 1.1%, while benefit costs, which make up the remainder of compensation costs, increased 0.9%.
The key takeaway from the report is that wages and salaries for workers were up from the same period a year ago, yet those gains have increasingly been subsumed by inflation, evidenced by the 6.5% increase in the PCE Price Index seen in the advance Q4 GDP report.

Looking ahead, investors will receive the Chicago PMI for January on Monday.

Dow Jones Industrial Average -4.4% YTD
S&P 500 -7.0% YTD
Nasdaq Composite -12.3% YTD
Russell 2000 -13.1% YTD

Crude futures eke out gain
28-Jan-22 15:30 ET
Dow +269.85 at 34430.63, Nasdaq +240.21 at 13592.99, S&P +58.58 at 4385.09

[BRIEFING.COM] There are 30 minutes left in the trading week, and the S&P 500 is up 1.4%, trimming its weekly loss to 0.3%.

The information technology sector reigns supreme with a 2.8% gain, followed by the real estate (+2.1%) and communication services (+1.7%) sectors. The energy (-1.6%), materials (-0.4%), and industrials (-0.4%) sectors still trade lower.

WTI crude futures settled higher by 0.1%, or $0.12, to $86.74/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34160.78 -7.31 (-0.02%)
Nasdaq 13352.78 -189.34 (-1.40%)
SP 500 4326.51 -23.42 (-0.54%)
10-yr Note +29/32 1.786
NYSE Adv 904 Dec 2381 Vol 1.1 bln
Nasdaq Adv 921 Dec 3551 Vol 5.1 bln

Industry Watch
Strong: Consumer Staples, Energy, Utilities, Materials
Weak: Consumer Discretionary, Real Estate, Information Technology, Financials

Moving the Market

-- Hawkish Fed expectations continued to weigh on sentiment

-- Tesla (TSLA) falls nearly 12.0% following earnings

-- Disappointing earnings guidance in the semiconductor space

-- Technical resistance at the S&P 500's 200-day moving average (4434)

Market closes lower as Fed concerns linger
27-Jan-22 16:20 ET
Dow -7.31 at 34160.78, Nasdaq -189.34 at 13352.78, S&P -23.42 at 4326.51

[BRIEFING.COM] The S&P 500 lost 0.5% on Thursday, closing lower for the third straight day as investors sold into early strength amid lingering concerns about a hawkish Fed. The Nasdaq Composite (-1.4%) and Russell 2000 (-2.3%) posted steeper declines while the Dow Jones Industrial Average (-0.02%) closed fractionally lower.

Each of the major indices started the session with gains over 1.5% in another rebound-minded pursuit. There wasn't any specific news that triggered the positive bias, and likewise, there wasn't a catalyst to account for the intraday turnaround, although it's likely that the Fed remained a primary concern along with disappointing earnings reactions and stubborn technical factors.

The fed funds futures market started to price in the probability for five rate hikes this year following the FOMC meeting yesterday, and the Treasury market behaved accordingly as the 2-yr yield jumped 11 basis points to 1.19%. The 10-yr yield declined four basis points to 1.81% as investors sniffed the potential for the Fed to upset growth prospects with its tightening plans.

Despite the negative index closes, six of the 11 S&P 500 sectors still closed in positive territory, including energy (+1.2%), utilities (+0.8%), and consumer staples (+0.6%). The consumer discretionary (-2.3%), information technology (-0.7%), and financials (-0.9%) sectors were the influential laggards.

The curve-flattening activity in the Treasury market was a headwind for the bank stocks, but as noted, the consumer discretionary sector was the weakest performer, primarily due to a 10% decline in Tesla (TSLA 829.10, -108.31, -11.6%), which delayed new vehicle launches amid persistent supply chain issues.

The Philadelphia Semiconductor Index (-4.8%) was another weak spot, falling 5% after Intel (INTC 48.05, -3.64, -7.0%), Lam Research (LRCX 555.30, -41.37, -6.9%), and Teradyne (TER 111.24, -32.13, -22.4%) each provided disappointing quarterly guidance.

McDonald's (MCD 248.74, -1.11, -0.4%), Dow Inc. (DOW 60.18, +2.96, +5.2%), MasterCard (MA 350.53, +5.87, +1.7%), and Comcast (CMCSA 48.01, -0.45, -0.9%) were other high-profile companies that reported earnings. Apple (AAPL 159.22, -0.47, -0.3%) closed lower in front of its earnings report after the close.

Other factors in the mix included the S&P 500 finding technical resistance at its 200-day moving average (4434), which might have fueled the downside volatility in the broader market, and the Advance Q4 GDP report, which showed decent growth in the economy and inflation.

Separately, the U.S. Dollar Index rose 1.4% to 97.25 amid a view that rate hikes will drive greater demand for the dollar in an environment where foreign central banks are hesitant to rein in policy support. Crude futures ($86.62, -0.74, -0.9%) and precious metals were clipped by the stronger dollar.

Reviewing Thursday's economic data:

The Advance Q4 GDP report showed real GDP increasing at an annual rate of 6.9% (Briefing.com consensus 5.6%) following a 2.3% increase in the third quarter. The GDP Chain Deflator was also up 6.9% (Briefing.com consensus 5.9%) after a 6.0% increase in the third quarter.
The key takeaway from the report is the recognition that services spending drove the 3.3% increase in personal spending and that inventory investment was the biggest contributor to the increase in real GDP. Real final sales of domestic product, which exclude the change in inventories, were up 1.9%.
Initial jobless claims for the week ending January 22 decreased by 30,000 to 260,000 (Briefing.com consensus 260,000). Continuing claims for the week ending January 15 increased by 51,000 to 1.675 million.
The key takeaway from the report is that initial claims came down from the prior week, but are still somewhat elevated presumably due to the effects of the Omicron variant.
December Durable Goods Orders decreased 0.9% month-over-month (Briefing.com consensus -0.5%) while orders, excluding transportation, increased 0.4% (Briefing.com consensus 0.4%).
The key takeaway from the report is the slowdown in business spending, evidenced by an unchanged reading for nondefense capital goods orders excluding aircraft that followed on the heels of a 0.3% increase in November.

Looking ahead, investors will receive Personal Income and Spending for December, PCE Prices for December, the final University of Michigan Index of Consumer Sentiment for January, and the Q4 Employment Cost Index on Friday.

Dow Jones Industrial Average -6.0% YTD
S&P 500 -9.2% YTD
Russell 2000 -14.0% YTD
Nasdaq Composite -14.7% YTD

Energy stocks outperform despite lower oil prices
27-Jan-22 15:30 ET
Dow +24.37 at 34192.46, Nasdaq -174.86 at 13367.26, S&P -18.03 at 4331.90

[BRIEFING.COM] The S&P 500 is down 0.7% and is on track for its third straight decline.

One last look at the sectors shows consumer discretionary (-2.2%), real estate (-2.0%), financials (-1.2%), and industrials (-1.1%) leading the decline, while the utilities (+0.8%), energy (+0.5%), and consumer staples (+0.6%) sectors outperform with modest gains.

WTI crude futures settled lower by 0.9%, or $0.74, to $86.62/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34297.73 -66.77 (-0.19%)
Nasdaq 13539.30 -315.83 (-2.28%)
SP 500 4356.45 -53.68 (-1.22%)
10-yr Note +2/32 1.749
NYSE Adv 1337 Dec 1922 Vol 1.2 bln
Nasdaq Adv 1883 Dec 2419 Vol 4.9 bln

Industry Watch
Strong: Energy, Financials
Weak: Information Technology, Consumer Discretionary, Communication Services, Utilities

Moving the Market

-- Growth stocks pace decline in volatile session

-- Dow outperforms on a relative basis amid better-than-expected earnings reports from five components

-- Tentative trading activity in front of FOMC policy decision tomorrow

Growth stocks pace decline in volatile session
25-Jan-22 16:15 ET
Dow -66.77 at 34297.73, Nasdaq -315.83 at 13539.30, S&P -53.68 at 4356.45

[BRIEFING.COM] The S&P 500 fell 1.2% on Tuesday in another volatile session. The benchmark index was down as much as 2.8% in the morning, then briefly peaked above its flat line in the afternoon. Growth stocks paced today's decline and accounted for the underperformance of the Nasdaq Composite (-2.3%).

The Dow Jones Industrial Average (-0.2%) was unable to hold onto a late gain and closed slightly lower. The Russell 2000 fell 1.5%.

From a sector perspective, the information technology (-2.3%), communication services (-2.2%), and consumer discretionary (-1.8%) sectors underperformed with steep losses. Conversely, the energy (+4.0%) and financials (+0.5%) sectors were only sectors that closed higher amid higher oil prices ($85.37, +2.06, +2.5%) and Treasury yields. For emphasis, the energy sector rose 4%.

The early weakness was symptomatic of the recent tendency to sell into any indication of strength (yesterday's specifically), which raised concerns about Monday's comeback being a potential head fake.

Encouragingly, the major indices traded well above yesterday's lows, which was good for overall sentiment and may have signaled an underlying hope that Fed Chair Powell could sound less hawkish than feared following the FOMC's policy statement tomorrow.

As for the intraday rebound, there wasn't any specific news to account for the price action, although better-than-expected earnings reports did appear to be an influential driver in the Dow's relative outperformance despite an initially mixed response.

Dow components Johnson & Johnson (JNJ 167.63, +4.66, +2.9%), American Express (AXP 172.96, +14.03, +8.8%), IBM (IBM 136.10, +7.28, +5.7%), 3M (MMM 173.73, +0.93, +0.5%), and Verizon (VZ 52.90, -0.06, -0.1%) each topped EPS estimates, and VZ was the only one that didn't close higher. AXP stood out with a 9% gain, followed by IBM's 6% gain.

General Electric (GE 91.11, -5.80, -6.0%) disappointed shareholders with a revenue miss and downside FY22 EPS guidance, while Microsoft (MSFT 288.49, -7.88, -2.7%) investors leaned cautiously in front of its earnings report after the close.

Microsoft, like other growth stocks, also had to contend with upwards pressure in interest rates. The 10-yr Treasury note yield rose five basis points to 1.78% while the 2-yr yield rose five basis points to 1.02%. The U.S. Dollar Index increased 0.1% to 95.98.

Separately, NVIDIA (NVDA 223.24, -10.48) fell 4.5% amid a Bloomberg report indicating that the company is planning to scrap its $40 billion acquisition of Arm Holdings due to ongoing regulatory issues. The FTC said it's going to sue to block Lockheed Martin's (LMT 387.18, +13.85, +3.7%) $4.4 billion acquisition of Aerojet Rocketdyne (AJRD 36.65, -8.35, -18.6%).

Reviewing Tuesday's economic data:

The Conference Board's Consumer Confidence Index dropped to 113.8 (Briefing.com consensus 112.0) from a downwardly revised 115.2 (prior 115.8) in December. The dip came after three consecutive monthly increases but is still well above the 87.1 reading registered in the same period a year ago.
The key takeaway from the report is the moderation in the outlook, which points to some potential weakening economic activity in the short term.
The November FHFA Housing Price Index increased 1.1% m/m following a 1.1% increase in October, and the November S&P Case-Shiller Home Price Index increased 18.3% yr/yr following a revised 18.5% increase (from 18.4%) in October.

Looking ahead, investors will receive New Home Sales for December; Advance Intl. Trade in Goods, Retail Inventories, and Wholesale Inventories for December; and the weekly MBA Mortgage Applications Index on Wednesday. Of course, the FOMC Rate Decision will follow the data in the afternoon.

Dow Jones Industrial Average -5.6% YTD
S&P 500 -8.6% YTD
Russell 2000 -10.8% YTD
Nasdaq Composite -13.5% YTD

Energy stocks following oil prices higher
25-Jan-22 15:30 ET
Dow -26.39 at 34338.11, Nasdaq -236.00 at 13619.13, S&P -41.62 at 4368.51

[BRIEFING.COM] The S&P 500 is down 0.8% after peaking above its flat line earlier this hour.

One last look at the S&P 500 sectors shows information technology (-1.5%), communication services (-1.6%), and consumer discretionary (-1.5%) each down 1.5%, while the energy (+3.9%) and financials (+0.6%) sectors continue to trade higher amid an increase in oil prices and Treasury yields.

WTI crude futures settled higher by 2.8%, or $2.36, to $85.66/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34364.50 +99.13 (0.29%)
Nasdaq 13855.13 +86.21 (0.63%)
SP 500 4410.21 +12.27 (0.28%)
10-yr Note +4/32 1.717
NYSE Adv 1459 Dec 1804 Vol 1.5 bln
Nasdaq Adv 2159 Dec 1710 Vol 6.9 bln

Industry Watch
Strong: Consumer Discretionary, Energy, Industrials
Weak: Utilities, Health Care, Information Technology

Moving the Market

-- Small-caps lead intraday recovery effort; market was oversold and due for a bounce

-- Consternations about the Ukraine-Russia situation, the Fed's policy meeting, and earnings this week

-- S&P 500 enters contraction territory, Nasdaq Composite approaches bear market territory

Stocks make huge comeback after facing steep losses
24-Jan-22 16:20 ET
Dow +99.13 at 34364.50, Nasdaq +86.21 at 13855.13, S&P +12.27 at 4410.21

[BRIEFING.COM] The S&P 500 increased 0.3% on Monday in a furious buy-the-dip trade after being down as much as 4.0% intraday. The Nasdaq Composite gained 0.6% after being down 4.9% intraday, and the Dow Jones Industrial Average gained 0.3% after being down 3.3% intraday.

The Russell 2000 outperformed with a 2.3% gain after being down as much as 2.8%. The small-cap index traded in bear market territory today, or down at least 20% from a recent high, so its outperformance stemmed from the fact that it was hit the hardest.

Eight of the 11 S&P 500 sectors closed higher after all 11 traded with steep losses. The consumer discretionary sector (+1.2%) led the recovery effort with a 1% gain, while the defensive-oriented utilities (-1.0%), health care (-0.4%), and consumer staples (-0.4%) sectors closed lower.

The session opened on a weak note, which gave way to a steady decline that accentuated the market's concerns on the Fed's tightening plans, the Russia-Ukraine situation, and peak earnings growth, among others. The selling itself was a concern, too, leading to expectations for more downside -- the CBOE Volatility Index (29.90, +1.05, +3.6%) spiked as much as 35% before calming down.

There's no doubt the market was oversold on a short-term basis and was due for a bounce, but no one really knew when that would happen. Fortunately for the bulls, the bounce happened today on no specific news and some short-covering activity in front of an eventful week in earnings, the Fed, and economic data.

It's worth noting that the Nasdaq Composite bottomed just before it could enter bear market territory. The tech-sensitive index was down 19.2% from its all-time high while the S&P 500 was down 12.4% from its all-time high.

Strikingly, the Treasury market never really exhibited a flight for safety, suggesting that the early weakness was more technically-oriented. The 10-yr yield declined just one basis point to 1.74% after trading at 1.71% during the day while the 2-yr yield declined two basis points to 0.97%. The U.S. Dollar Index rose 0.3% to 95.92. WTI crude fell 2.2%, or $1.86, to $83.30/bbl.

Separately, Kohl's (KSS 63.71, +16.87, +36.0%) stood out with a 36% gain after confirming takeover interest from PE firms, which are reportedly willing to acquire the company for at least $64 per share.

Reviewing Monday's economic data:

The preliminary IHS Markit Services PMI for January fell to 55.0 from 57.7 in the final reading for December. The preliminary IHS Markit Services PMI for January fell to 50.9 from 57.6 in the final reading for December.

Looking ahead, investors will receive the Conference Board's Leading Economic Index for January, the S&P Case-Shiller Home Price Index for November, and the FHFA Housing Price Index for November on Tuesday.

Dow Jones Industrial Average -5.4% YTD
S&P 500 -7.5% YTD
Russell 2000 -9.4% YTD
Nasdaq Composite -11.4% YTD

Crude futures settle lower by 2%
24-Jan-22 15:30 ET
Dow -399.27 at 33866.10, Nasdaq -144.87 at 13624.05, S&P -56.81 at 4341.13

[BRIEFING.COM] The S&P 500 is down 1.4% to trade near session "highs."

One last look at the sector performances shows utilities (-2.4%) and health care (-1.9%) underperforming with steep losses, while the consumer discretionary sector (-0.6%) outperforms on a relative basis with a 0.6% decline.

WTI crude futures settled lower by 2.2%, or $1.86, to $83.30/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34265.37 -450.02 (-1.30%)
Nasdaq 13768.92 -385.10 (-2.72%)
SP 500 4397.94 -84.79 (-1.89%)
10-yr Note +4/32 1.762
NYSE Adv 649 Dec 2615 Vol 1.3 bln
Nasdaq Adv 841 Dec 3544 Vol 5.8 bln

Industry Watch
Strong: Consumer Staples
Weak: Communication Services, Consumer Discretionary, Materials

Moving the Market

-- S&P 500 closes below 200-day moving average (4429)

-- Netflix (NFLX) plunges 22% on disappointing Q1 guidance

-- Concerns about profit margins, valuations, the Fed, and geopolitics

-- Safe-haven trade in Treasuries

S&P 500 loses battle with its 200-day moving average
21-Jan-22 16:20 ET
Dow -450.02 at 34265.37, Nasdaq -385.10 at 13768.92, S&P -84.79 at 4397.94

[BRIEFING.COM] The S&P 500 fell 1.9% on Friday, as de-risking efforts persisted amid an inclination to sell into strength, disappointing Q1 guidance from Netflix (NFLX 397.50, -110.75, -21.8%), deteriorating technical factors, and a flight to safety in Treasuries.

The Nasdaq Composite declined 2.7%, the Dow Jones Industrial Average declined 1.3%, and the Russell 2000 declined 1.8%.

Eight of the 11 S&P 500 sectors fell at least 1.0%, including the communication services sector with a 3.9% decline. The consumer staples sector (+0.02%) closed fractionally higher.

The session began with Netflix weighing on sentiment after the company guided for slower subscriber growth and below-consensus revenue for Q1, as well as a smaller operating margin versus Q1 of last year amid higher programming costs.

The operating margin guidance, coupled with a Q1 EPS warning from PPG Industries (PPG 154.74, -4.96, -3.1%), fed into concerns about higher costs eating into profits. In addition, the visceral reaction mirrored the plunge in Peloton (PTON 27.06, +2.84, +11.7%) yesterday, stirring a fear of being invested in high-multiple growth stocks that disappoint.

In Peloton's defense, the company provided reassuring Q2 guidance, and its CEO said prior reporting of its plans to pause production was inaccurate. PTON shares bounced roughly 12% today after falling 24% yesterday.

Back to the broader market, buyers swooped in to defend a violation of the S&P 500's 200-day moving average (4429) early in the session. The benchmark index briefly returned into positive territory, until investors reprised efforts to sell into strength. The benchmark index closed below the key technical level.

This negative price action left buyers mistrustful of the market, imprinting a belief that the dip will keep on dipping until proven otherwise. The CBOE Volatility Index increased 12.7% to 28.85 amid increased hedging interest.

Other worries in the market included what the Fed will say in next week's policy meeting and the Russia-Ukraine conflict that the U.S. is trying to defuse.

The Treasury market was less of a concern, but only because it was acting as a safe-haven trade from equities. The 2-yr yield fell six basis points to 0.99%, and the 10-yr yield fell nine basis points to 1.75%. The U.S. Dollar Index decreased 0.1% to 95.63. WTI crude futures fell 1.3%, or $1.13, to $85.16/bbl.

Friday's economic data was limited to the Conference Board's Leading Economic Index for December, which increased 0.8%, as expected, following a revised 0.7% increase (from +1.1%) in November. On Monday, investors will receive the preliminary IHS Markit Manufacturing and Services PMIs for January.

Dow Jones Industrial Average -5.7% YTD
S&P 500 -7.7% YTD
Russell 2000 -11.5% YTD
Nasdaq Composite -12.0% YTD

Crude futures settle lower amid de-risking efforts
21-Jan-22 15:30 ET
Dow -457.74 at 34257.65, Nasdaq -349.14 at 13804.88, S&P -82.85 at 4399.88

[BRIEFING.COM] The S&P 500 is down 1.8% to trade at session lows amid losses in all 11 sectors.

Eight of the 11 sectors are down over 1.0%, including a 3.5% decline in the communication services sector. The consumer staples sector (-0.1%) outperforms on a relative basis with a 0.1% decline.

WTI crude futures settled lower by 1.3%, or $1.13, to $85.16/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 34715.39 -313.26 (-0.89%)
Nasdaq 14154.02 -186.23 (-1.30%)
SP 500 4482.73 -50.03 (-1.10%)
10-yr Note +3/32 1.833
NYSE Adv 813 Dec 2426 Vol 941.5 mln
Nasdaq Adv 1196 Dec 3192 Vol 5.0 bln

Industry Watch
Strong: Utilities
Weak: Consumer Discretionary, Materials, Information Technology, Industrials

Moving the Market

-- Investors sell into strength (again) and market closes at session lows

-- Indiscriminate selling

-- Peloton (PTON) drops 24% on CNBC report that it's temporarily halting production of its bikes due to significantly lower demand

Stocks tumble into the close, fading early gains
20-Jan-22 16:20 ET
Dow -313.26 at 34715.39, Nasdaq -186.23 at 14154.02, S&P -50.03 at 4482.73

[BRIEFING.COM] The S&P 500 declined 1.1% on Thursday in another disappointing session, as investors doubled down on the inclination to sell into strength. The benchmark index faded a 1.5% gain and closed the session down 7.0% from its all-time high.

The Nasdaq Composite fell 1.3% after being up 2.1% intraday. The Dow Jones Industrial Average fell 0.9% after being up 1.3% intraday. The Russell 2000 fell 1.9% after being up 2.0% intraday.

Ten of the 11 S&P 500 sectors closed lower after all 11 traded in positive territory in the morning. The consumer discretionary (-1.9%), materials (-1.4%), and information technology (-1.3%) sectors led the retreat, while the utilities sector (+0.1%) eked out a gain.

The bullish bias in the morning was attributed to a belief that the market was oversold on a short-term basis and was due for a bounce. Both the Nasdaq Composite and Russell 2000 entered the session in correction territory, or down at least 10% from a recent high.

Investors waited a little longer than yesterday to sell into strength, which ultimately diminished confidence in the market and scared away potential buyers on the fear that the dip will keep on dipping. The S&P 500 briefly topped the 4600 level around 10:00 a.m. ET before running into negative headlines later in the day.

Selling interest picked up after CNBC reported that Peloton (PTON 24.22, -7.62, -23.9%) is temporarily pausing production of its bikes due to waning consumer demand. Later, The Wall Street Journal reported that the U.S. gave approval for Estonia, Lithuania, and Latvia to send arms to Ukraine.

The Peloton story served as reminder of the risks that many story stocks still face if their stories don't play out as intended. The Ukraine story was more of a negative geopolitical headline in the middle of a market downturn, meaning the market was less disturbed by the report and saw it more as a convenient selling excuse.

The latter theory was supported by the lack of a safe-haven trade in Treasuries and gold ($1842.60/ozt, unch). The 10-yr yield increased just one basis point to 1.83% while the 2-yr yield rose four basis points to 1.05% on continued expectations for a more hawkish Fed. The U.S. Dollar Index gained 0.4% to 96.85. WTI crude futures fell 0.7%, or $0.57, to $86.29/bbl.

Pivoting to earnings news, United Airlines (UAL 42.88, -1.52, -3.4%) and American Airlines (AAL 16.76, -0.55, -3.2%) were swept up in the downturn after providing cautious near-term outlooks. Travelers (TRV 165.18, +5.11, +3.2%) and Union Pacific (UNP 242.07, +2.58, +1.1%) were two earnings standouts.

Reviewing Thursday's economic data:

Initial claims for the week ending January 15 increased by 55,000 to 286,000 (Briefing.com consensus 211,000) while continuing claims for the week ending January 8 increased by 84,000 to 1.635 million.
The key takeaway from the report is that it is apt to be construed as a sign of the negative impact the Omicron variant is having on the labor market since it is the highest initial claims number since October; moreover, this report includes the week in which the survey for the January employment report was conducted, so the higher print could dial down expectations for the gain in January nonfarm payrolls.
Existing home sales declined 4.6% m/m in December to a seasonally adjusted annual rate of 6.18 million (Briefing.com consensus 6.42 million). Total sales in December were down 7.1% from a year ago. Total home sales in 2021, however, reached 6.12 million, which was up 8.5% year-over-year and the highest annual level since 2006.
The key takeaway from the report is that prices remain high as inventory remains extremely tight. The supply constraint is crimping sales growth in the existing home market, as are increasing affordability pressures created by the high selling prices and rising mortgage rates.
The Philadelphia Fed Index for January increased to 23.2 (Briefing.com consensus 20.0) from 15.4 in December.

Looking ahead, investors will receive the Conference Board's Leading Economic Index for December on Friday.

Dow Jones Industrial Average -4.5% YTD
S&P 500 -6.0% YTD
Russell 2000 -9.9% YTD
Nasdaq Composite -9.5% YTD

Market turns negative amid selling momentum
20-Jan-22 15:30 ET
Dow -41.77 at 34986.88, Nasdaq -62.00 at 14278.25, S&P -13.83 at 4518.93

[BRIEFING.COM] The S&P 500 has turned negative with a 0.3% decline as selling interest picks up. The inclination to sell into strength has undercut confidence in this market.

One last look at the sectors shows consumer discretionary (-1.0%) leading the market lower with a 1.0% decline amid weakness in Amazon (AMZN 3053.38, -73.25, -2.4%). Conversely, the utilities (+0.6%), energy (+0.4%), financials (+0.2%), and health care (+0.2%) sectors trade higher.

WTI crude futures settled lower by 0.7%, or $0.57, to $86.29/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35028.65 -339.82 (-0.96%)
Nasdaq 14340.25 -166.64 (-1.15%)
SP 500 4532.76 -44.35 (-0.97%)
10-yr Note +4/32 1.834
NYSE Adv 1016 Dec 2292 Vol 942.1 mln
Nasdaq Adv 1443 Dec 2879 Vol 4.6 bln

Industry Watch
Strong: Consumer Staples, Utilities
Weak: Financials, Consumer Discretionary, Information Technology

Moving the Market

-- Investors sell into early strength and market closes at session lows in weak finish

-- Inability to rebound with lower interest rates and encouraging earnings news

-- Selling momentum

Stocks close lower in disappointing session
19-Jan-22 16:20 ET
Dow -339.82 at 35028.65, Nasdaq -166.64 at 14340.25, S&P -44.35 at 4532.76

[BRIEFING.COM] The S&P 500 fell 1.0% on Wednesday, fading an early 0.8% gain despite encouraging earnings news and a decline in interest rates. The Nasdaq Composite (-1.2%) and Dow Jones Industrial Average (-1.0%) performed comparably to the benchmark index, while the Russell 2000 lagged with a 1.6% decline.

Nine of the 11 S&P 500 sectors closed lower, as selling interest accelerated into the close on no specific news. The consumer discretionary (-1.8%), financials (-1.7%), and information technology (-1.4%) sectors led the retreat, while the consumer staples (+0.7%) and utilities (+0.5%) sectors closed higher.

Early on, there was optimism surrounding the EPS beats from Procter & Gamble (PG 162.00, +5.27, +3.4%), UnitedHealth (UNH 462.52, +1.53, +0.3%), Bank of America (BAC 46.44, +0.18, +0.4%), and Morgan Stanley (MS 95.74, +1.73, +1.8%) insofar that they signaled more companies would successfully navigate the higher-cost business environment.

At the same time, interest rates had backed off from overnight highs and continued to push lower throughout the session. It looked like a good set-up for an equity rebound, but unfortunately, that didn't happen. The inability to rebound from sizable losses deterred risk sentiment, fueling a belief that more downside was ahead.

Presumably, investors bought the dip in Treasuries to hide out from the equity volatility, geopolitical uncertainty, and any impact from the Fed's tightening plans. As a reminder, the Fed meets next week to discuss monetary policy.

The 2-yr yield declined two basis points to 1.01% after flirting with 1.08% overnight, and the 10-yr yield declined four basis points to 1.83% after flirting with 1.90% overnight. The U.S. Dollar Index declined 0.2% to 95.56. WTI crude futures approached $87.00 per barrel ($86.86/bbl, +1.38, +1.6%).

Interestingly, homebuilding stocks were noticeably weak despite housing starts and building permits for December beating expectations. There might have been some disappointment that the increases were driven by multi-unit dwellings instead of single-unit dwellings.

The iShares US Home Construction ETF (ITB 71.73, -1.88) fell 2.6%, additionally pressured by KeyBanc Capital Markets downgrading several stocks in the space.

Reviewing Wednesday's economic data:

Housing starts increased 1.4% month-over-month in December to a seasonally adjusted annual rate of 1.702 million (Briefing.com consensus 1.650 million) while permits increased 9.1% month-over-month to 1.873 million (Briefing.com consensus 1.702 million).
The key takeaway from the report is that the increases were driven by multi-unit dwellings. Single-unit starts were down 2.3% and single-unit permits were up just 2.0% with little to no growth in the two largest homebuilding regions (the South and the West).
The weekly MBA Mortgage Applications Index increased 2.3% following a 1.4% increase in the prior week.

Looking ahead, investors will receive the weekly Initial and Continuing Claims report, Existing Home Sales for December, and the Philadelphia Fed Index for January on Thursday.

Dow Jones Industrial Average -3.6% YTD
S&P 500 -4.9% YTD
Russell 2000 -8.1% YTD
Nasdaq Composite -8.3% YTD

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Market Snapshot

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Dow 35368.47 -543.34 (-1.51%)
Nasdaq 14506.89 -386.86 (-2.60%)
SP 500 4577.11 -85.74 (-1.84%)
10-yr Note -26/32 1.874
NYSE Adv 516 Dec 2818 Vol 1.0 bln
Nasdaq Adv 817 Dec 3602 Vol 5.0 bln

Industry Watch
Strong: Energy
Weak: Information Technology, Financials, Communication Services

Moving the Market

-- Major indices down over 1.0% as interest rates continue to climb

-- 2-yr yield tops 1.00% on expectations for four rate hikes this year

-- Higher oil prices fuel inflation angst

-- Disappointing bank earnings reactions

Stocks drop amid rising rates and Goldman Sachs EPS miss
18-Jan-22 16:20 ET
Dow -543.34 at 35368.47, Nasdaq -386.86 at 14506.89, S&P -85.74 at 4577.11

[BRIEFING.COM] The S&P 500 fell 1.8% on Tuesday amid anxiety surrounding rising interest rates, as well as some concerns about corporate earnings. The Nasdaq Composite (-2.6%) and Russell 2000 (-3.1%) suffered steeper losses while the Dow Jones Industrial Average fell 1.5%.

Ten of the 11 S&P 500 sectors closed lower with losses ranging from 0.7% (real estate) to 2.5% (information technology). The energy sector (+0.4%) was the exception, extending its monthly gain to roughly 17%, amid another 2% increase in oil prices ($85.48, +1.61, +1.9%).

The first issue for the market today was the persistent rise in Treasury yields, which signaled growing expectations for the Fed to hike rates four times this year -- including a potential 50-bps increase in March -- to keep inflation in check.

The 2-yr yield jumped seven basis points to 1.03%, the 10-yr yield jumped nine basis points to 1.87%, and the 30-yr yield jumped seven basis points to 2.18%. The U.S. Dollar Index increased 0.5% to 95.76. Inflation angst was fueled by the increase in oil prices, which was a byproduct of tensions in Europe and the Middle East.

Goldman Sachs (GS 354.40, -26.54, -7.0%) was the second problem today, as shares fell 7% after missing EPS estimates amid a sharp increase in compensation expenses. Rising wages have previously been cited as a potential headwind for corporate earnings, so to see that play out negatively in Goldman's case might have fueled concerns about this being a pain point for this earnings season.

The latter could explain why selling interest was almost indiscriminate. Growth stocks (big and small) may have led the retreat, but value stocks (excluding energy) also did poorly. The Russell 3000 Index fell 2.4%, and the Russell 3000 Value Index fell 1.5%.

Apart from inflation pressures, risk sentiment was curbed by deteriorating technical factors and a negative reading in the Empire State Manufacturing Survey for January, which dropped to -0.7 (Briefing.com consensus 25.0) from 31.9 in December. The Nasdaq Composite closed below its 200-day moving average (14730) for the first time since April 2020.

Separately, Microsoft (MSFT 302.65, -7.55, -2.4%) announced an acquisition of Activision Blizzard (ATVI 82.31, +16.92, +25.9%) for $68.7 billion, or $95.00 per share, in cash.

Reviewing Tuesday's economic data:

The Empire State Manufacturing Survey for January dropped to -0.7 (Briefing.com consensus 25.0) from 31.9 in December.
The NAHB Housing Market Index for January decreased to 83 (Briefing.com consensus 84) from 84 in December.

Looking ahead, investors will receive Housing Starts and Building Permits for December and the weekly MBA Mortgage Applications Index on Wednesday.

Dow Jones Industrial Average -2.7% YTD
S&P 500 -4.0% YTD
Russell 2000 -6.6% YTD
Nasdaq Composite -7.3% YTD

Crude futures settle above $85 per barrel
18-Jan-22 15:30 ET
Dow -508.43 at 35403.38, Nasdaq -333.54 at 14560.21, S&P -77.58 at 4585.27

[BRIEFING.COM] The S&P 500 is down 1.7% while the Russell 2000 underperforms with a 2.2% decline.

One last look at the S&P 500 sectors shows energy (+0.6%) back in positive territory while the other ten sectors trade lower between 0.8% (real estate) and 2.2% (information technology).

WTI crude futures settled higher by 1.9%, or $1.61, to $85.48/bbl amid rising tensions in Europe and the Middle East.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35911.81 -201.81 (-0.56%)
Nasdaq 14893.75 +86.94 (0.59%)
SP 500 4662.85 +3.82 (0.08%)
10-yr Note -29/32 1.782
NYSE Adv 1301 Dec 1961 Vol 893.2 mln
Nasdaq Adv 1994 Dec 2396 Vol 4.3 bln

Industry Watch
Strong: Energy, Information Technology, Communication Services
Weak: Real Estate, Financials, Materials, Utilities

Moving the Market

-- Market overcomes hurdles in front of three-day weekend, as investors buy the intraday dip

-- Mixed bank earnings, downbeat economic data, interest rates rise

-- Relative strength in the mega-caps

S&P 500 overcomes hurdles in front of three-day weekend
14-Jan-22 16:15 ET
Dow -201.81 at 35911.81, Nasdaq +86.94 at 14893.75, S&P +3.82 at 4662.85

[BRIEFING.COM] The S&P 500 gained 0.1% on Friday after being down 1.0% intraday, as the market overcame mixed bank earnings, downbeat economic data, and a sharp rise in interest rates. The Nasdaq Composite (+0.6%) and Russell 2000 (+0.1%) also closed higher, while the Dow Jones Industrial Average fell 0.6%.

Starting with earnings, JPMorgan Chase (JPM 157.89, -10.34, -6.2%) was an eye sore with a 6% decline after missing revenue estimates, while Wells Fargo (WFC 58.06, +2.06, +3.7%) rallied about 4% on upbeat results. Citigroup (C 66.93, -0.85, -1.3%) and BlackRock (BLK 848.60, -18.98, -2.2%) also underwhelmed investors with their results.

The financials sector (-1.0%) was the second-weakest performer in the S&P 500 behind the real estate sector (-1.2%). The materials sector (-0.8%) was restrained by a Q4 EPS warning from Sherwin-Williams (SHW 308.46, -8.93, -2.8%), which cited raw-material availability and labor headwinds in December.

Conversely, the energy sector (+2.4%) was impressive, rising 2.4% amid another increase in WTI crude futures ($83.87, +1.91, +2.3%). The information technology (+0.9%) and communication services (+0.5%) sectors were instrumental in the comeback amid relative strength in the mega-caps.

The Vanguard Mega Cap Growth ETF (MGK 246.35, +0.73, +0.3%) rose 0.3% in an opportunistic trade after entering the session down 5.8% for the year. For comparison, the Invesco S&P 500 Equal Weight ETF (RSP 161.58, -0.28, -0.2%) declined 0.2% today.

The sharp increase in 10-yr yield, which rose six basis points to 1.77%, did not deter the intraday rebound effort. The 2-yr yield rose seven basis points to 0.96% on expectations for a more assertive Fed. The U.S. Dollar Index advanced 0.4% to 95.16.

Interest rates rose despite retail sales for December, industrial production and capacity utilization for December, and preliminary consumer sentiment for January decreasing on a month-over-month basis. The catalyst was perhaps the inflation component of the consumer sentiment report, which showed 5-year inflation expectations rose to 3.1% -- its highest level since 2011.

Separately, casino stocks outperformed after Bloomberg reported that Macau authorities will issue up to six casino licenses as part of regulatory changes in the city. Las Vegas Sands (LVS 42.99, +5.33, +14.2%) rallied 14% on the news.

Reviewing Friday's economic data:

Total retail sales were down 1.9% month-over-month in December (Briefing.com consensus 0.0%) while retail sales, excluding autos, decreased 2.3% (Briefing.com consensus 0.2%). On a year-over-year basis, total retail sales were up 16.9% and up 18.8% excluding autos.
The key takeaway from the report is that total retail sales, which are not adjusted for inflation, contracted at their fastest pace since last February in the face of broadly higher prices. This suggests that inflation is weighing down consumer spending.
Total industrial production decreased 0.1% in December (Briefing.com consensus 0.3%) following an upwardly revised 0.7% increase (from 0.5%) in November. The capacity utilization rate dipped to 76.5% (Briefing.com consensus 77.1%) from a revised 76.6% (from 76.8%) in November.
The key takeaway from the report is that the December dip was owed to a pullback in manufacturing production after two months of solid growth.
The preliminary January reading for the University of Michigan Index of Consumer Sentiment came in at 68.8 (Briefing.com consensus 68.5) versus the final December reading of 70.6.
The key takeaway from the report is that inflation expectations are becoming more entrenched, as the 5-year inflation expectations rose to 3.1%, representing the first increase above the 3.0% mark since 2011.
Import prices fell 0.2% in December after increasing 0.7% in November. Excluding oil, import prices increased 0.5% after increasing 0.5% in November. Export prices fell 1.8% after increasing 0.8% in November. Excluding agriculture, export prices fell 2.1% after increasing 0.6% in November.
Business inventories increased 1.3% m/m in November (Briefing.com consensus 1.0%) following a revised 1.3% increase (from 1.2%) in October.

Looking ahead, investors will receive the Empire State Manufacturing Index for January, the NAHB Housing Market Index for January, and Net Long-Term TIC Flows for November on Tuesday. As a reminder, the market will be closed on Monday in observance of Martin Luther King, Jr. Day.

Dow Jones Industrial Average -1.2% YTD
S&P 500 -2.2% YTD
Russell 2000 -3.7% YTD
Nasdaq Composite -4.8% YTD

Crude futures settle near $84 per barrel
14-Jan-22 15:30 ET
Dow -286.27 at 35827.35, Nasdaq +51.00 at 14857.81, S&P -6.19 at 4652.84

[BRIEFING.COM] The S&P 500 is down 0.1% to trade near its best levels of the session amid an uptick in the mega-cap stocks, which are seeing some relief after a tough start to the year.

One last look at the sectors shows energy (+2.3%) in a league of its own amid higher oil prices, followed by the information technology (+0.7%) and communication services (+0.5%) sectors. The financials (-1.2%) and real estate (-1.1%) sectors are down more than 1.0%.

WTI crude futures settled higher by 2.3%, or $1.91, to $83.87/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36290.32 +38.30 (0.11%)
Nasdaq 15188.39 +34.94 (0.23%)
SP 500 4726.35 +13.28 (0.28%)
10-yr Note +1/32 1.733
NYSE Adv 1654 Dec 1570 Vol 854.0 mln
Nasdaq Adv 1850 Dec 2609 Vol 4.3 bln

Industry Watch
Strong: Materials, Consumer Discretionary
Weak: Health Care

Moving the Market

-- Large-cap indices eke out gains following hot CPI report for December

-- Total CPI increased 0.5% m/m (Briefing.com consensus 0.4%), leaving it up 7.0% yr/yr

-- Tame response in the Treasury market

Large-caps eke out gains following hot CPI data
12-Jan-22 16:15 ET
Dow +38.30 at 36290.32, Nasdaq +34.94 at 15188.39, S&P +13.28 at 4726.35

[BRIEFING.COM] The large-cap indices eked out gains on Wednesday, as investors lacked conviction following another hot Consumer Price Index (CPI) report for December. The S&P 500 (+0.3%), Nasdaq Composite (+0.2%), and Dow Jones Industrial Average (+0.1%) rose between 0.1-0.3% while the Russell 2000 fell 0.8%.

Ten of the 11 S&P 500 sectors did close in positive territory, but the lightly-weighted materials sector (+1.0%) was the only sector that rose at least 1.0%. The health care sector (-0.3%) was the lone holdout with a modest decline. Declining issues outpaced advancing issues at the Nasdaq.

Specifying the data, total CPI rose 0.5% m/m in December (Briefing.com consensus 0.4%) and was up 7.0% yr/yr, which was the sharpest 12-month increase since June 1982. Core CPI, which excludes food and energy, rose 0.6% m/m (Briefing.com consensus 0.5%) and was up 5.5% yr/yr.

The 10-yr yield went from 1.74% to 1.71% in the wake of the report, signaling that inflation-rate expectations could be peaking with the Fed planning to tighten policy this year. This immediate decline in long-term rates was cited as early boost for the stock market, particularly the growth stocks.

The S&P 500 was up 0.8% shortly after the open, but as the 10-yr yield stabilized, so did the rebound bias in growth stocks. The Russell 3000 Growth Index, for example, increased just 0.2% after being up 1.2% intraday.

Fortunately for the large-cap indices, the mega-caps did okay. The Vanguard Mega Cap Growth ETF (MGK 252.32, +1.53, +0.6%) advanced 0.6%, which was better than the 0.1% gain in the Invesco S&P 500 Equal Weight ETF (RSP 162.61, +0.13, +0.1%).

In the afternoon, the Fed's Beige Book for January noted that economic activity in the U.S. expanded at a modest pace in the last weeks of 2021 and that some districts observed a deceleration in the robust price increases from the previous months. The report was a nonevent for the market.

The 10-yr yield settled the session down two basis points to 1.73%, and the 2-yr yield decreased one basis point to 0.89%. The U.S. Dollar Index fell 0.7% to 94.95. WTI crude futures rose 1.7%, or $1.38, to $82.52/bbl amid bullish inventory data.

Separately, shares of Biogen (BIIB 225.34, -16.18, -6.7%) dropped nearly 7.0% after Medicare officials proposed to limit coverage of the company's Alzheimer's treatment to only those patients that participated in approved clinical trials.

Reviewing Wednesday's economic data:

Total CPI rose 0.5% month-over-month in December (Briefing.com consensus 0.4%) and was up 7.0% year-over-year. This represented the sharpest 12-month increase since June 1982. Core CPI, which excludes food and energy, rose 0.6% month-over-month (Briefing.com consensus 0.5%) and was up 5.5% year-over-year. This was the sharpest 12-month increase since February 1991.
The key takeaway from the report is that while some categories, like the energy index, showed a decrease in December, the continuation of the overall trend resulted in another acceleration of the year-over-year inflation rate at the headline and core levels.
The Treasury Budget showed a $21.3 bln deficit in December versus a $143.6 bln deficit in the same period a year ago. The budget data is not seasonally adjusted, so the December deficit cannot be compared to the November deficit of $191.3 bln. December marked the 27th consecutive month that the Treasury has seen a budget deficit.
The budget deficit over the last 12 months is $2.58 trln versus a deficit of $2.70 trln in November.
The weekly MBA Mortgage Applications Index increased 1.4% following a 5.6% decline in the prior week.
Weekly EIA crude oil inventories decreased by 4.55 mln barrels after decreasing by 2.14 mln barrels during the previous week.

Looking ahead, investors will receive the Producer Price Index for December and the weekly MBA Mortgage Applications Index on Thursday.

Dow Jones Industrial Average -0.1% YTD
S&P 500 -0.8% YTD
Nasdaq Composite -2.9% YTD
Russell 2000 -3.1% YTD

Crude futures settle higher (again)
12-Jan-22 15:30 ET
Dow -13.98 at 36238.04, Nasdaq +22.20 at 15175.65, S&P +7.48 at 4720.55

[BRIEFING.COM] The S&P 500 is up 0.2%, as is the Nasdaq (+0.2%) heading into the close.

One last look at the sectors shows materials (+0.7%) overtaking the information technology (+0.3%) and consumer discretionary (+0.5%) sectors for the top spot. The health care (-0.4%) and consumers staples (-0.2%) sectors trade slightly lower.

WTI crude futures settled higher by 1.7%, or $1.38, to $82.52/bbl amid bullish inventory data. The EIA reported its seventh straight week of an inventory draw.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36252.02 +183.15 (0.51%)
Nasdaq 15153.45 +210.62 (1.41%)
SP 500 4713.04 +42.75 (0.92%)
10-yr Note 0/32 1.765
NYSE Adv 2392 Dec 849 Vol 852.8 mln
Nasdaq Adv 3048 Dec 1404 Vol 4.3 bln

Industry Watch
Strong: Energy, Information Technology, Materials
Weak: Utilities, Real Estate, Consumer Staples

Moving the Market

-- Stocks extend rebound bid following Fed Chair Powell's Senate confirmation hearing

-- Treasury yields calmed down

-- S&P 500 reclaims 50-day moving average (4678)

Stocks extend rebound bid following Powell's confirmation hearing
11-Jan-22 16:15 ET
Dow +183.15 at 36252.02, Nasdaq +210.62 at 15153.45, S&P +42.75 at 4713.04

[BRIEFING.COM] The S&P 500 gained 0.9% on Tuesday in a continuation of dip-buying efforts that started yesterday afternoon. The Nasdaq Composite (+1.4%) and Russell 2000 (+1.1%) outperformed with gains over 1.0% while the Dow Jones Industrial Average (+0.5%) rose more modestly.

The session started on a softer note as buyers held off conviction for Fed Chair Powell's Senate confirmation hearing. Mr. Powell didn't say anything particularly new, reaffirming that he thinks the Fed will end asset purchases in March, hike rates over the course of the year, and allow the balance sheet to run off later in the year.

The reaction in the Treasury market was perhaps more consequential for stocks. The 2-yr yield quickly backed down from 1.94% and settled unchanged at 0.90% while the 10-yr yield drifted lower by three basis points to 1.75%. The U.S. Dollar Index fell 0.4% to 95.62.

The S&P 500 information technology (+1.2%) led the market higher with the retracement in yields, but it was outdone by the 3% gain in the energy sector (+3.4%). Energy stocks followed oil prices ($81.14, +3.03, +3.9%) higher.

Conversely, the utilities (-0.9%), real estate (-0.2%), and consumer staples (-0.1%) sectors closed lower, as their defensive characteristics did not sit well with investors in the rebound-minded session.

From a technical perspective, the ability for the S&P 500 to reclaim its 50-day moving average (4678) was seen as another good development for dip-buying activity. This key technical level has shown to be a good buying opportunity since April 2020.

Looking at individual stocks, IBM (IBM 132.87, -2.16, -1.6%) was an exception in the tech sector after receiving a downgrade to Sell from Neutral at UBS. Illumina (ILMN 423.80, +61.52, +17.0%) jumped 17% on upbeat guidance while CVS Health (CVS 106.04, +0.98, +0.9%) set a 52-week high after raising its FY21 EPS guidance above consensus.

Tuesday's economic data was limited to the NFIB Small Business Optimism Index, which December increased to 98.9 in December from 98.4 in November.

Looking ahead, investors will receive the Consumer Price Index for December, the Fed's Beige Book for January, the Treasury Budget for December, and the weekly MBA Mortgage Applications Index on Wednesday.

Dow Jones Industrial Average -0.2% YTD
S&P 500 -1.1% YTD
Russell 2000 -2.3% YTD
Nasdaq Composite -3.1% YTD

Crude futures settle 4% higher
11-Jan-22 15:30 ET
Dow +192.81 at 36261.68, Nasdaq +203.98 at 15146.81, S&P +41.25 at 4711.54

[BRIEFING.COM] The S&P 500 is up 0.8% and is looking up to the Nasdaq (+1.3%) and Russell 2000 (+1.1%).

One last look at the sector performances shows energy in a league of its own with a 3.5% gain, largely due to a 4% gain in oil prices ($81.49, +3.26, +4.2%). The information technology sector (+1.2%) follows behind with a 1.2%, while the utilities (-0.8%) and consumer staples (-0.3%) sectors trade lower.

WTI crude futures settled higher by 3.9%, or $3.03, to $81.14/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36068.87 -162.79 (-0.45%)
Nasdaq 14942.83 +6.93 (0.05%)
SP 500 4670.29 -6.74 (-0.14%)
10-yr Note 0/32 1.772
NYSE Adv 1174 Dec 2051 Vol 1.0 bln
Nasdaq Adv 1565 Dec 2943 Vol 5.2 bln

Industry Watch
Strong: Health Care
Weak: Industrials, Materials, Consumer Discretionary

Moving the Market

-- Stocks extend last week's losses amid de-risking efforts, but currently trade off session lows

-- 10-yr yield touches 1.81% before retracing to 1.77%

-- Deteriorating technical posture

Nasdaq completes comeback after 10-yr yield calms down
10-Jan-22 16:15 ET
Dow -162.79 at 36068.87, Nasdaq +6.93 at 14942.83, S&P -6.74 at 4670.29

[BRIEFING.COM] The S&P 500 (-0.1%) declined for the fifth straight session on Monday, but it only lost 0.1% after being down 2.0% intraday. The Nasdaq Composite (+0.1%) eked out a gain after being down 2.7% intraday, while the Dow Jones Industrial Average (-0.5%) and Russell 2000 (-0.4%) also closed well off session lows.

The intraday weakness was attributed to persisting concerns about rising rates and the Fed's agenda for policy normalization. The 10-yr yield hit 1.81% intraday before ending the session at 1.77%, or one basis point above Friday's settlement. The 2-yr yield rose three basis points to 0.90%.

Investors started to buy the dip soon after it looked like the 10-yr yield peaked for the day, finding a good excuse to buy into an oversold condition. The Nasdaq, for instance, was down 8.2% in less than five sessions and had fallen below its 200-day moving average (14690).

The S&P 500 couldn't reclaim its 50-day moving average (4675), though, as eight of its 11 sectors still closed lower. The industrials (-1.2%) and materials (-1.0%) sectors declined at least 1.0%, while the health care sector advanced 1.0%.

Evidently, cyclical stocks were lumped into the selling activity today. Besides downside momentum, risk sentiment in the space was pressured by a report from the Washington Post indicating that Senator Manchin (D-WV) is no longer interested in passing any legislation resembling the Build Back Better Act.

In the health care space, Pfizer (PFE 56.24, +0.52, +0.9%) told CNBC that a COVID-19 vaccine for the Omicron variant will be ready in March, and Moderna (MRNA 233.70, +19.84, +9.3%) provided an upbeat sales forecast for COVID-19 vaccines in 2022.

Separately, shares of Take-Two Interactive (TTWO 142.99, -21.61, -13.1%) dropped 13% on concerns that it overpaid for Zynga (ZYNG 8.44, +2.44, +40.7%). The cash-and-stock transaction at $9.86 per Zynga share gave the company a total enterprise value of approximately $12.7 billion.

The U.S. Dollar Index increased 0.3% to 95.97. WTI crude futures declined 1.1%, or $0.83, to $78.11/bbl.

Monday's economic data was limited to Wholesale Inventories, which increased 1.4% m/m in November (Briefing.com consensus 1.2%) following a revised 2.5% increase (from 1.2%) in October. Looking ahead, investors will receive the NFIB Small Business Optimism Index for December on Tuesday.

Dow Jones Industrial Average -0.7% YTD
S&P 500 -2.0% YTD
Russell 2000 -3.3% YTD
Nasdaq Composite -4.5% YTD

Crude futures settle lower
10-Jan-22 15:30 ET
Dow -306.35 at 35925.31, Nasdaq -111.31 at 14824.59, S&P -33.48 at 4643.55

[BRIEFING.COM] The S&P 500 is down 0.7% as the market continues to recoup losses.

One last look at the sectors shows industrials (-1.5%), materials (-1.4%), and consumer discretionary (-1.5%) down more than 1.0%, while the health care sector (+0.7%) outperforms in positive territory.

WTI crude futures settled lower by 1.1%, or $0.83, to $78.11/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36231.66 -4.81 (-0.01%)
Nasdaq 14935.90 -144.96 (-0.96%)
SP 500 4677.03 -19.02 (-0.41%)
10-yr Note -4/32 1.764
NYSE Adv 1648 Dec 1571 Vol 903.0 mln
Nasdaq Adv 1898 Dec 2514 Vol 4.2 bln

Industry Watch
Strong: Energy, Financials, Utilities, Consumer Staples
Weak: Information Technology, Consumer Discretionary

Moving the Market

-- Growth stocks remained under pressure as 10-yr yield hit 1.80% intraday

-- Nonfarm payrolls increased by 199,000 (Briefing.com consensus 440,000), unemployment rate was 3.9% (Briefing.com consensus 4.1%), average hourly earnings rose 0.6% (Briefing.com consensus 0.4%)

-- Energy and financial stocks extended weekly gains

-- S&P 500 finds support at its 50-day moving average (4675)

Growth/value divide widens after employment report
07-Jan-22 16:20 ET
Dow -4.81 at 36231.66, Nasdaq -144.96 at 14935.90, S&P -19.02 at 4677.03

[BRIEFING.COM] The S&P 500 declined 0.4% on Friday, as money continued to flow away from growth stocks and into value stocks as the 10-yr yield hit 1.80% intraday. The latter was catalyzed by the December employment report, which depicted tight labor market conditions with a slowdown in hiring and strong wage gains.

The growth/value divide was loosely represented by the steep underperformance of the Nasdaq Composite (-1.0%) versus the Dow Jones Industrial Average (unch). More clearly, the Russell 3000 Growth Index fell 1.1% while the Russell 3000 Value Index rose 0.2%. The small-cap Russell 2000 declined 1.2%.

From a sector perspective, the S&P 500 information technology (-1.0%) and consumer discretionary (-1.7%) sectors underperformed in negative territory. Conversely, the energy (+1.5%) and financials (+1.2%) sectors rose more than 1.0%, extending their weekly gains to more than 10.0% and 5.0%, respectively.

Specifying the key employment figures, December nonfarm payrolls increased by just 199,000 (Briefing.com consensus 440,000), the unemployment rate remarkably declined to 3.9% (Briefing.com consensus 4.1%), and average hourly earnings rose 0.6% (Briefing.com consensus 0.4%).

The report reaffirmed expectations for the Fed to be more assertive in normalizing policy, even though jobs growth missed expectations and the labor force participation rate held steady at 61.9% (below pre-pandemic levels).

December still capped an impressive rebound for the labor market in 2021, and it appears to be approaching the Fed's goal of maximum employment. Furthermore, the Fed has suggested it's more attuned to keeping inflation pressures in check, and it wouldn't want the robust wage growth to exacerbate inflation pressures.

The 10-yr yield, as mentioned, hit 1.80% in the hours following the employment report, but ended the session at 1.77%, or four basis points above yesterday's settlement. The 2-yr yield decreased two basis points to 0.87%. The U.S. Dollar Index fell 0.6% to 95.75. WTI crude futures fell 0.6%, or $0.46, to $78.94/bbl.

For what it's worth, the S&P 500 closed just above its 50-day moving average (4675), which is a key technical level that has attracted dip-buying efforts in the past.

Reviewing Friday's economic data:

December payrolls growth was quite weak, but that shouldn't remain the case as we get past the Omicron hurdle. The unemployment rate fell to an astounding 3.9%, although the labor force participation rate did not improve. It held steady at 61.9%. Average hourly earnings were up a stronger than expected 0.6%.
December nonfarm payrolls increased by 199,000 (Briefing.com consensus 440,000). The 3-month average for total nonfarm payrolls decreased to 365,000 from 425,000 in November. November nonfarm payrolls revised to 249,000 from 210,000. October nonfarm payrolls revised to 648,000 from 546,000.
December private sector payrolls increased by 211,000 (Briefing.com consensus 420,000). November private sector payrolls revised to 270,000 from 235,000. October private sector payrolls revised to 714,000 from 628,000.
December unemployment rate was 3.9% (Briefing.com consensus 4.1%), versus 4.2% in November. Persons unemployed for 27 weeks or more accounted for 31.7% of the unemployed versus 32.5% in November. The U6 unemployment rate, which accounts for unemployed and underemployed workers, was 7.3%, versus 7.7% in November.
December average hourly earnings increased 0.6% (Briefing.com consensus 0.4%) versus a 0.4% increase in November. Over the last 12 months, average hourly earnings have risen 4.7%, versus 5.1% for the 12 months ending in November.
The average workweek in December was 34.7 hours (Briefing.com consensus 34.8), versus a downwardly revised 34.7 hours (from 34.8 hours) in November. Manufacturing workweek decreased 0.1 hours to 40.3 hours. Factory overtime decreased 0.1 hours to 3.2 hours.
The labor force participation rate held steady at 61.9%.
The employment-population ratio increased to 59.5% from 59.3% in November.
The key takeaway from the report is that it shows the Fed is close to meeting its objective of maximum employment and that wage growth in a tight labor market risks feeding into more persistent inflation pressures that will need to be addressed with a tighter policy position.
Consumer credit increased by $39.9 bln in November. The prior month saw a downward revision to $16.1 bln from $16.9 bln.
The key takeaway from the report is that increase in consumer credit in November was the largest monthly increase December 2010.

Looking ahead, investors will receive Wholesale Inventories for November on Monday.

Dow Jones Industrial Average -0.3% YTD
S&P 500 -1.9% YTD
Russell 2000 -2.9% YTD
Nasdaq Composite -4.5% YTD

Crude futures settle lower but still end higher for the week
07-Jan-22 15:30 ET
Dow +69.13 at 36305.60, Nasdaq -124.46 at 14956.40, S&P -12.62 at 4683.43

[BRIEFING.COM] The S&P 500 is down 0.2% and is on track to end the week with a 1.7% decline.

One last look at the sector performances shows consumer discretionary (-1.6%) leading the decline as the only sector down more than 1.0% today. The energy (+1.4%), financials (+1.0%), and utilities (+1.0%) sectors are each up by at least 1.0%.

WTI crude futures settled lower by 0.6%, or $0.46, to $78.94/bbl. For the week, crude futures were up 5.0%.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36236.47 -170.64 (-0.47%)
Nasdaq 15080.86 -19.31 (-0.13%)
SP 500 4696.05 -4.53 (-0.10%)
10-yr Note -24/32 1.729
NYSE Adv 1823 Dec 1453 Vol 912.7 mln
Nasdaq Adv 2155 Dec 2359 Vol 4.7 bln

Industry Watch
Strong: Energy, Financials, Industrials
Weak: Health Care, Materials, Utilities

Moving the Market

-- Lack of conviction drives underwhelming session as Treasury yields continue to edge higher

-- S&P 500 finds technical support at 50-day moving average (4672)

-- Growth stocks pare intraday losses while value stocks outperform

Large-cap indices underwhelm as tech sector remains weak
06-Jan-22 16:20 ET
Dow -170.64 at 36236.47, Nasdaq -19.31 at 15080.86, S&P -4.53 at 4696.05

[BRIEFING.COM] The stock market closed mixed on Thursday in an underwhelming effort following yesterday's retreat. The S&P 500 and Nasdaq Composite both declined 0.1%, and the Dow Jones Industrial Average declined 0.5%. The small-cap Russell 2000, however, advanced 0.6%.

There was a bit of a growth-stock scare in the morning, as the 10-yr yield hit 1.75% and the Nasdaq declined as much as 1.2% after the open. Fortunately, the 10-yr yield stabilized, and investors presumably felt comfortable enough to buy beleaguered growth stocks, especially after the S&P 500 bounced off its 50-day moving average (4672).

Buying conviction was kept in check, though, partly because of anxiety surrounding monetary policy normalization, the upwards path in interest rates, and the possibility for more selling in the days to come. There might also have been a wait-and-see mindset for the December employment report tomorrow.

Five of the 11 S&P 500 sectors ended the session in positive territory while six sectors closed lower. The materials (-1.2%), health care (-1.2%), and utilities (-1.1%) sectors declined more than 1.0% while the information technology sector declined 0.5%.

The heavily-weighted technology sector held back the S&P 500 in a meaningful way considering the Invesco S&P 500 Equal Weight Index (RSP 162.03, +0.36) gained 0.2%. The biggest gainers were found in the financials (+1.6%) and energy (+2.3%) sectors, which extended their weekly gains to 4% and 9%, respectively.

While growth stocks pared intraday losses, there was still there was a lingering preference for value stocks. This preference was better represented by the 0.3% gain in the Russell 3000 Index, versus the 0.2% decline in the Russell 3000 Growth Index.

Walgreens Boots Alliance (WBA 52.44, -1.56, -2.9%) was a value-oriented stock that underperformed despite reporting better-than-expected earnings results and raising its FY22 EPS guidance. Shares of the Dow component fell 3% after being up 0.9% intraday.

Recapping the moves in the Treasury market, the 10-yr yield settled three basis points higher at 1.73% while the 2-yr yield rose six basis points to 0.88% amid expectations for a more aggressive Fed. The U.S. Dollar Index increased 0.1% to 96.30. WTI crude futures rose 2.0%, or $1.58, to $79.40/bbl after briefly topping $80.00/bbl.

Reviewing Thursday's economic data:

Initial claims for the week ending January 1 increased by 7,000 to 207,000 (Briefing.com consensus 198,000) and continuing claims for the week ending December 25 increased by 36,000 to 1.754 million.
The key takeaway is that the latest data didn't disrupt the idea that the labor market is tight and that initial claims are running at pre-pandemic levels, which at the time were thought to be quite low.
The ISM Non-Manufacturing Index for December decreased to 62.0% (Briefing.com consensus 67.1%) from a record high 69.1% in November. The dividing line between expansion and contraction is 50.0%. The December reading marks the 19th straight month of growth for the services sector.
The key takeaway from the report is that it isn't surprising to see some softening following a record-high print and the arrival of the Omicron variant; however, the uptick in the prices index is a worrisome inflation point given the narrative that consumers will be engaging more with services companies in 2022 than they did in 2021.
The trade deficit for November widened to $80.2 billion (Briefing.com consensus -$69.4 billion) from $67.2 billion in October. Exports were $0.4 billion higher than October exports and imports were $13.4 billion more than October imports.
The key takeaway relates to the soft growth in exports, which reflects relatively weak demand abroad before the Omicron variant made its presence felt.
Factory orders for manufactured goods increased 1.6% m/m in November (Briefing.com consensus 1.2%) following an upwardly revised 1.2% increase (from 1.0%) in October. Shipments of manufactured goods jumped 0.7% after increasing 2.0% in October.
The key takeaway from the report is the lack of order growth for nondefense capital goods, excluding aircraft -- a proxy for business spending. That connotes a slowdown, but to be fair, it follows a string of monthly increases, so it appears at this juncture to be some natural slowing after an extended period of strength.

Looking ahead, investors will receive the Employment Situation Report for December and Consumer Credit for November on Friday.

Dow Jones Industrial Average -0.3% YTD
S&P 500 -1.5% YTD
Russell 2000 -1.7% YTD
Nasdaq Composite -3.6% YTD

Crude futures briefly top $80 per barrel
06-Jan-22 15:30 ET
Dow -107.43 at 36299.68, Nasdaq +22.05 at 15122.22, S&P +5.55 at 4706.13

[BRIEFING.COM] The S&P 500 is up just 0.1% as buyers struggle to follow through from early-mornin

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36407.11 -392.54 (-1.07%)
Nasdaq 15100.17 -522.54 (-3.34%)
SP 500 4700.58 -92.96 (-1.94%)
10-yr Note 0/32 1.651
NYSE Adv 583 Dec 2682 Vol 1.0 bln
Nasdaq Adv 978 Dec 3456 Vol 5.0 bln

Industry Watch
Strong: Energy, Materials, Utilities, Consumer Staples
Weak: Real Estate, Information Technology, Communication Services, Consumer Discretionary

Moving the Market

-- Market sells off following release of FOMC Minutes, which highlighted a more aggressive stance on policy normalization

-- Growth stocks extended intraday losses while value stocks gave up intraday gains

-- 10-yr yield tops 1.70%

-- December ADP Employment Change report was stronger than expected

FOMC Minutes catalyzes sell-off in broader market
05-Jan-22 16:20 ET
Dow -392.54 at 36407.11, Nasdaq -522.54 at 15100.17, S&P -92.96 at 4700.58

[BRIEFING.COM] A mixed market turned into a weak market on Wednesday after the FOMC Minutes highlighted a more aggressive stance on policy normalization. The Nasdaq Composite and Russell 2000 both dropped 3.3%, the S&P 500 dropped 1.9%, and the Dow Jones Industrial Average dropped 1.1% after setting an all-time high in early action.

Briefly, the Minutes from the December meeting showed that participants thought it would be appropriate to reduce the size of the Fed's balance sheet at a faster pace than during the previous normalization period. Cited reasons included the fact that the balance sheet is bigger this time around and that the economic outlook is stronger.

What's more, the participants judged that the commencement of a balance sheet runoff would likely be closer to after the first rate hike, versus waiting nearly two years after the first hike in the last normalization episode.

Growth stocks extended intraday losses, as the 10-yr yield topped 1.70% in the wake of the report, while value stocks gave up intraday gains. All 11 S&P 500 sectors closed lower, with real estate (-3.2%), information technology (-3.1%), and communication services (-2.9%) each falling about 3.0%.

The consumer staples (-0.03%), utilities (-0.1%), energy (-0.1%), and materials (-0.1%) sectors closed fractionally lower amid increased selling pressure into the close.

The market might have been caught off guard by the Fed's hawkish tone regarding the balance sheet, but the readiness to hike rates shouldn't come as a surprise. According to the CME FedWatch Tool, the probability for a rate hike in March increased to 67.8% today, versus 59.7% yesterday and 27.1% one month ago.

Rate-hike expectations firmed up today after the release of a stronger-than-expected December ADP Employment Change report, which estimated an addition of 807,000 jobs to private sector payrolls last month (Briefing.com consensus 425,000).

The 2-yr yield, which tracks expectations for the fed funds rate, rose seven basis points to 0.83%. The 10-yr yield settled the session four basis points higher at 1.71%, feeding into expectations for a run-up to 2.00%. The U.S. Dollar Index decreased 0.1% to 96.20. WTI crude futures rose 1.1%, or $0.82, to $77.82/bbl.

All in all, the balance-sheet commentary, coupled with higher interest rates, was presumably an excuse for investors to double down on the growth-stock selling and take profits in the value stocks.

Reviewing Wednesday's economic data:

ADP estimated that 807,000 jobs were added to private sector payrolls in December (Briefing.com consensus 425,000), up from a downwardly revised 505,000 (from 534,000) in November.
The preliminary IHS Markit Services PMI for December decreased to 57.6 from 58.0 in the final reading for November.
The MBA Mortgage Applications Index decreased 5.6% on a weekly basis.
Crude oil inventories had a weekly draw of 2.144 mln barrels, which was the EIA's sixth draw in six weeks.

Looking ahead, investors will receive the ISM Non-Manufacturing Index for December, the weekly Initial and Continuing Claims report, the Trade Balance for November, and Factory Orders for November on Thursday.

Dow Jones Industrial Average +0.2% YTD
S&P 500 -1.4% YTD
Russell 2000 -2.3% YTD
Nasdaq Composite -3.5% YTD

Crude futures settle higher while stocks struggle
05-Jan-22 15:30 ET
Dow -274.74 at 36524.91, Nasdaq -459.72 at 15162.99, S&P -74.30 at 4719.24

[BRIEFING.COM] The S&P 500 is trading at session lows with a 1.5% decline amid losses in seven of its 11 sectors.

The real estate sector (-3.1%) is the weakest performer, but the biggest drags are the information technology (-2.6%), communication services (-2.2%), and consumer discretionary (-2.3%) sectors. The energy (+0.2%), materials (+0.3%), consumer staples (+0.2%), and utilities (+0.2%) sectors trade higher.

WTI crude futures settled higher by 1.1%, or $0.82, to $77.82/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36799.65 +214.59 (0.59%)
Nasdaq 15622.71 -210.08 (-1.33%)
SP 500 4793.54 -3.02 (-0.06%)
10-yr Note -2/32 1.648
NYSE Adv 1670 Dec 1614 Vol 950.3 mln
Nasdaq Adv 1857 Dec 2637 Vol 5.0 bln

Industry Watch
Strong: Financials, Energy, Industrials, Materials
Weak: Information Technology, Health Care, Consumer Discretionary

Moving the Market

-- Dow sets intraday and closing record highs amid strength in the value/cyclical stocks

-- Growth stocks fall amid continued rise in long-term rates

-- December ISM Manufacturing Index showed ease in inflation pressures

Value stocks propel Dow to record highs
04-Jan-22 16:20 ET
Dow +214.59 at 36799.65, Nasdaq -210.08 at 15622.71, S&P -3.02 at 4793.54

[BRIEFING.COM] The S&P 500 declined 0.1% on Tuesday in a mixed session, which was better represented by the sharp divergence between the Dow Jones Industrial Average (+0.6%) and Nasdaq Composite (-1.3%). Both the S&P 500 and Dow set intraday record highs while the Dow also set a closing record high. The Russell 2000 declined 0.2%.

Today's session was reminiscent of the classic reopening trade, except that it's 2022 and daily COVID-19 cases in the U.S. topped one million yesterday. Value/cyclical stocks outperformed at the expense of growth stocks, the Treasury yield curve steepened, and WTI crude futures settled at $77.00 per barrel (+$1.00, +1.3%).

More specifically, the S&P 500 energy (+3.5%), financials (+2.6%), industrials (+2.0%), and materials (+1.3%) sectors rose between 1-4%. The 10-yr yield increased four basis points to 1.67% while the 2-yr yield decreased two basis points to 0.76%. The U.S. Dollar Index increased 0.1% to 96.28.

Notably, the 10-yr yield has now risen 16 basis points start the year, increasing the probability that 2022 will be marked by a higher-interest rate environment, as forecasted by many analysts on Wall Street. This view weighed on the highly-valued growth stocks, albeit in a delayed reaction since the Nasdaq was up 0.1% in early action.

The information technology (-1.1%), health care (-1.4%), and consumer discretionary (-0.7%) sectors struggled amid weakness in the growth stocks. The Vanguard Mega Cap Growth ETF (MGK 260.20, -3.27) fell 1.2%. The iShares Biotechnology ETF (IBB 148.29, -4.08) fell 2.7%. The ARK Innovation ETF (ARKK 92.69, -4.30) fell 4.4%.

Selling interest in the growth stocks accelerated soon after the release of the December ISM Manufacturing Index at 10:00 a.m. ET. While the index decelerated more than expected to 58.7% (Briefing.com consensus 60.3%) from 61.1% in November, it still denoted an expanding manufacturing sector.

More encouragingly, the Prices Index in the ISM report showed a noticeable ease in inflation pressures. The Omicron variant could pose risks this month, but the inference from today (and prior weeks) is that market sees the economic impact from the variant as short-term.

Growth stocks eventually pared losses in the afternoon, helping the market end the Santa Claus rally period on a better note.

Reviewing Tuesday's economic data:

The December ISM Manufacturing Index checked in at 58.7% (Briefing.com consensus 60.3%) versus 61.1% in November. A number above 50.0% is indicative of expansion. December marked the 19th straight month of expansion for the manufacturing sector, albeit at a slower pace.
The key takeaway from the report is the recognition that price pressures softened some, presumably due to improved supply chain conditions; however, supply concerns (and inflation worries) aren't going to fade away knowing that the Omicron variant is driving global staffing challenges.
Job openings decreased to 10.562 million in November from a revised 11.091 million (from 11.033 million) in October.

Looking ahead, investors will receive the ADP Employment Change report for December, the FOMC Minutes from the December meeting, the preliminary IHS Markit Services PMI for December, and the weekly MBA Mortgage Applications Index on Wednesday.

Dow Jones Industrial Average +1.3% YTD
Russell 2000 +1.1% YTD
S&P 500 +0.6% YTD
Nasdaq Composite -0.1% YTD

Crude futures settle at $77 per barrel amid expected OPEC+ decision
04-Jan-22 15:30 ET
Dow +280.04 at 36865.10, Nasdaq -203.38 at 15629.41, S&P +2.51 at 4799.07

[BRIEFING.COM] The S&P 500 is trading at its flat line and is vying for a record close despite the weakness from the mega-caps.

One last look at the sectors shows energy (+3.5%), financials (+2.7%), industrials (+2.0%), and materials (+1.4%) leading the effort with nice gains, while the information technology (-1.1%), health care (-1.2%), and consumer discretionary (-0.6%) sectors underperform in negative territory.

WTI crude futures settled higher by 1.3%, or $1.00, to $77.00 per barrel. On a related note, OPEC+ reaffirmed an agreement to increase output by 400,000 barrels/day in February, which was expected.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36585.06 +246.76 (0.68%)
Nasdaq 15832.79 +187.83 (1.20%)
SP 500 4796.56 +30.38 (0.64%)
10-yr Note -11/32 1.640
NYSE Adv 1928 Dec 1418 Vol 845.0 mln
Nasdaq Adv 3290 Dec 1418 Vol 4.3 bln

Industry Watch
Strong: Energy, Consumer Discretionary, Financials
Weak: Health Care, Consumer Staples, Utilities, Real Estate

Moving the Market

-- Apple (AAPL) hits $3 trillion market capitalization

-- Tesla (TSLA) up 12% after reporting record Q4 deliveries

-- Treasury yield rise noticeably

S&P 500 and Dow close at record highs to begin 2022
03-Jan-22 16:20 ET
Dow +246.76 at 36585.06, Nasdaq +187.83 at 15832.79, S&P +30.38 at 4796.56

[BRIEFING.COM] The major indices had a great start to 2022 on Monday, featuring record closes in the S&P 500 (+0.6%) and Dow Jones Industrial Average (+0.7%). The Nasdaq Composite (+1.2%) and Russell 2000 (+1.2%) tied for the lead with 1.2% gains.

The outperformance of the Nasdaq was attributed to a 13.5% gain in Tesla (TSLA 1199.78, +143.00, +13.5%), which reported record Q4 deliveries, and sizable gains in Apple (AAPL 182.01, +4.44, +2.5%), Amazon.com (AMZN 3408.09, +73.75, +2.2%), and NVIDIA (NVDA 301.21, +7.10, +2.4%).

Apple became the first U.S. company to reach a $3.0 trillion market capitalization while Amazon and the small-caps may have adhered to the January effect. The latter is a view that beaten-down stocks outperform to begin the year with the conclusion of tax-loss selling pressure.

The S&P 500 consumer discretionary sector, which is home to TSLA and AMZN, advanced 2.8%, but it was outdone by the energy sector (+3.1%) amid higher oil prices ($76.05/bbl, +0.76, +1.0%). The financials (+1.2%) and information technology (+1.2%) sectors followed suit, with the former keying off a big jump in longer-dated Treasury yields.

The mega-caps, to emphasize, made a huge difference for the large-cap indices since the S&P 500 Equal Weight Index increased just 0.1% and six of the 11 S&P 500 sectors closed lower. The materials (-1.4%), health care (-1.0%), and real estate (-1.0%) sectors each declined by at least 1.0%.

Shares of Pfizer (PFE 56.65, -2.40, -4.1%) and BioNTech (BNTX 231.85, -25.95, -10.1%) declined noticeably amid an expected decision from the FDA, which approved their COVID-19 vaccine for kids aged 12-15. The FDA also shortened the time between the second dose and booster dose to at least five months (down from six months).

In the Treasury market, the 10-yr yield rose 12 basis points to 1.63%, with selling interest influenced by the positive showing in the stock market and potentially due to an improving perspective on the economy. The 2-yr yield rose six basis points to 0.79%. The U.S. Dollar Index increased 0.3% to 96.21.

Reviewing Monday's economic data:

Total construction spending increased 0.4% month-over-month in November (Briefing.com consensus +0.6%) following an upwardly revised 0.4% increase (from 0.2%) in October. Total private construction increased 0.6% month-over-month while total public construction spending decreased 0.2%. On a year-over-year basis, total construction spending was up 9.3%.
The key takeaway from the report is the strength seen in new single-family construction, which is a reflection of the persistently strong housing demand amid a scarcity of supply in the existing home market.
The preliminary December IHS Markit Manufacturing PMI decreased to 57.7 from a revised final reading of 58.3 (from 57.8) in November.

Looking ahead, investors will receive the ISM Manufacturing Index for December and the JOLTS - Job Openings report for November on Tuesday.

Nasdaq Composite +1.2% YTD
Russell 2000 +1.2% YTD
Dow Jones Industrial Average +0.7% YTD
S&P 500 +0.6% YTD

Crude futures settle above $76 per barrel
03-Jan-22 15:30 ET
Dow +215.09 at 36553.39, Nasdaq +177.05 at 15822.01, S&P +26.82 at 4793.00

[BRIEFING.COM] The S&P 500 continues to trade higher by 0.6% with 30 minutes remaining in the session.

One last look at the sectors shows energy (+3.0%) and consumer discretionary (+2.5%) up by at least 2.5%, while the real estate (-1.3%), materials (-1.2%), health care (-1.1%), and utilities (-1.1%) sectors are each down more than 1.0%.

WTI crude futures settled higher by $0.76 (+1.0%) to $76.05/barrel.

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Market Snapshot
Dow 36338.30 -59.78 (-0.16%)
Nasdaq 15644.96 -96.59 (-0.61%)
SP 500 4766.18 -12.55 (-0.26%)
10-yr Note 0/32 1.514
NYSE Adv 1990 Dec 1333 Vol 702.5 mln
Nasdaq Adv 2141 Dec 2535 Vol 3.3 bln

Industry Watch
Strong: Consumer Staples, Materials, Industrials
Weak: Communication Services, Information Technology, Health Care

Moving the Market

-- Market slips into the close, led by the Nasdaq amid weakness in the mega-caps

-- Year-end rebalancing activity

-- Broader market held its ground

Mega-caps lead market lower to wrap up a record 2021
31-Dec-21 16:20 ET
Dow -59.78 at 36338.30, Nasdaq -96.59 at 15644.96, S&P -12.55 at 4766.18

[BRIEFING.COM] The major indices declined modestly on Friday amid some slippage into the close, but still wrapped up 2021 with double-digit percentage gains. The Nasdaq Composite fell 0.6% amid weakness in the mega-caps, while the S&P 500 (-0.3%), Dow Jones Industrial Average (-0.2%), and Russell 2000 (-0.2%) closed slightly lower.

There weren't any specific catalysts today, but the underperformance of the mega-caps suggested there was some year-end rebalancing activity in the mix. Some of that activity likely happened into the close, as the relatively weak finish coincided with an increase in trading volume.

Six of the 11 S&P 500 sectors closed higher while five closed lower. The consumer staples sector (+0.7%) was the only sector that gained more than 0.5%, while the communication services sector (-1.2%) declined more than 1.0%.

Illustrating the year-end activity, the Vanguard Mega Cap Growth ETF (MGK 260.76, -1.55) declined 0.6% today and ended the year with a 28.0% gain -- roughly equal to the 27.6% gain in the Invesco S&P 500 Equal Weight ETF (RSP 162.75, unch).

Pfizer (PFE 59.05, +0.65, +1.1%) outperformed amid news that its oral antiviral for COVID-19 was approved by UK regulators for people with mild-to-moderate disease and that Israel will offer a fourth coronavirus vaccine to nursing home residents.

The Dow Jones Transportation Average (+0.6%) was another an area of relative strength, particularly the non-airline components like Norfolk Southern (NSC 297.71, +2.98, +1.0%) and CSX (CSX 37.60, +0.28, +0.8%), which set record highs.

The Treasury market had an uneventful, abbreviated session. The 2-yr yield decreased one basis point to 0.73% (+61 bps in 2021), and the 10-yr yield was unchanged at 1.51% (+59 bps in 2021). The U.S. Dollar Index decreased 0.4% to 95.63. WTI crude futures fell 2.2%, or $1.70, to $75.15/bbl (+55.7% in 2021).

Investors did not receive any economic data on Friday. Looking ahead, investors will receive Construction Spending for November on Monday.

S&P 500 +26.9% YTD
Nasdaq Composite +21.4% YTD
Dow Jones Industrial Average +18.7% YTD
Russell 2000 +13.8% YTD

Crude futures end year at $75 per barrel
31-Dec-21 15:30 ET
Dow +66.70 at 36464.78, Nasdaq -37.27 at 15704.28, S&P +4.37 at 4783.10

[BRIEFING.COM] The S&P 500 is up 0.1% while the Dow (+0.2%) and Russell 2000 (+0.2%) retain a small advantage.

One last look at the sectors before the year ends shows real estate (+0.7%) and consumer staples (+0.7%) tied for the lead, while the communication services (-0.7%) and information technology (-0.1%) sectors trade lower.

WTI crude futures settled lower by 2.2%, or $1.70, to $75.15/bbl, ending the year with a 55.7% gain.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36398.08 -90.55 (-0.25%)
Nasdaq 15741.55 -24.65 (-0.16%)
SP 500 4778.73 -14.33 (-0.30%)
10-yr Note +4/32 1.511
NYSE Adv 1843 Dec 1444 Vol 638.3 mln
Nasdaq Adv 2750 Dec 1878 Vol 3.7 bln

Industry Watch
Strong: Financials, Energy, Health Care
Weak: Consumer Staples, Utilities

Moving the Market

-- S&P 500 and Dow set record highs with modest gains

-- Positive bias persists amid seasonal factors, thin trading volume, and lack of market-moving news

Market fumbles gains into the close
30-Dec-21 16:20 ET
Dow -90.55 at 36398.08, Nasdaq -24.65 at 15741.55, S&P -14.33 at 4778.73

[BRIEFING.COM] The S&P 500 (-0.3%) and Dow Jones Industrial Average (-0.3%) set intraday record highs early in Thursday's session, but they struggled to build on those gains and closed slower amid increased selling interest into the close. The Nasdaq Composite (-0.2%) and Russell 2000 (-0.02%) also fumbled gains and closed slightly lower.

The record-setting start was a carryover from yesterday amid seasonal factors, thin trading conditions, and a lack of specific catalysts. The gains were modest and lacked conviction, as the S&P 500 sectors wavered within 0.5% of their flat lines for most of the day.

It wasn't until the last 30 minutes of action that sellers gained control. Some participants, who are taking tomorrow off for New Year's Eve, might have taken profits while others would point to the view that the market was overbought and due for a breather.

Seven of the 11 S&P 500 sectors closed lower, including information technology (-0.7%) and energy (-0.7%) as laggards. The real estate (+0.4%), utilities (+0.3%), health care (+0.2%), and communication services (+0.1%) sectors closed higher.

Buying conviction might have also been restrained by ongoing headwinds attributed to the Omicron variant.

Specifically, Micron (MU 93.89, -2.28, -2.4%) warned of potential delays because of the lockdown in the Chinese city of Xi'an. The CDC upped its travel notice on cruise lines to Level 4, advising people to "avoid cruise travel, regardless of vaccination status." JetBlue (JLBU 14.24, -0.14, -1.0%) reportedly reduced its flight schedule next month in anticipation of staffing shortages.

On the bright side, vaccine news remained encouraging. Johnson & Johnson (JNJ 172.31, +0.76, +0.4%) said data demonstrated its booster shot was 85% effective against hospitalization in South Africa when the Omicron variant was dominant. The FDA is expected to expand eligibility for Pfizer's (PFE 58.40, +0.82, +1.4%) booster shot to 12- to 15-year-olds on Monday, according to The New York Times.

Separately, Biogen (BIIB 240.00, -18.31, -7.1%) dropped 7% after Samsung Group denied it was in talks to acquire the company.

U.S. Treasuries were on the defensive throughout the day, leaving yields lower. The 2-yr yield decreased one basis point to 0.74%, and the 10-yr yield decreased three basis points to 1.52%. The U.S. Dollar Index increased 0.1% to 95.98. WTI crude futures increased 0.4%, or $0.28, to $76.85/bbl.

Reviewing Thursday's economic data:

Initial jobless claims for the week ending December 25 decreased by 8,000 to 198,000 (Briefing.com consensus 190,000) while continuing claims for the week ending December 18 decreased by 140,000 to 1.716 million.
The key takeaway from the report is the recognition that the four-week moving average for initial claims (199,250) is the lowest it has been since October 25, 1969, which reflects the tightness of the labor market.
The Chicago PMI increased to 63.1 in December (Briefing.com consensus 61.8) from 61.8 in November.

There is no economic data scheduled for Friday, which will be a full day of trading for the stock market.

S&P 500 +27.2% YTD
Nasdaq Composite +22.1% YTD
Dow Jones Industrial Average +18.9% YTD
Russell 2000 +13.9% YTD

WTI crude futures settle higher
30-Dec-21 15:30 ET
Dow +14.05 at 36502.68, Nasdaq +48.47 at 15814.67, S&P +2.77 at 4795.83

[BRIEFING.COM] The S&P 500 is up 0.1% and is trying to close at a record high.

One last look at the sectors shows real estate (+0.6%) and health care (+0.4%) outperforming with modest gains, while the energy sector (-0.6%) underperforms with a 0.6% gain.

WTI crude futures settled higher by 0.4%, or $0.28, to $76.85/bbl. In related news, Reuters reported that OPEC+ is aiming to keep its current production schedule at the Jan. 4 meeting.

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Market Snapshot

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Dow 36488.63 +90.42 (0.25%)
Nasdaq 15766.20 -15.51 (-0.10%)
SP 500 4793.06 +6.71 (0.14%)
10-yr Note -6/32 1.549
NYSE Adv 1831 Dec 1476 Vol 608.8 mln
Nasdaq Adv 1938 Dec 2711 Vol 3.7 bln

Industry Watch
Strong: Health Care, Real Estate, Utilities
Weak: Energy, Communication Services, Financials

Moving the Market

-- S&P 500 and Dow close at record highs in calm session

-- Below-average volume, lack of conviction

-- Treasury yield curve steepened, but bank stocks barely reacted

S&P 500 and Dow close at record highs
29-Dec-21 16:20 ET
Dow +90.42 at 36488.63, Nasdaq -15.51 at 15766.20, S&P +6.71 at 4793.06

[BRIEFING.COM] The major indices closed little changed on Wednesday, but the S&P 500 (+0.1%) and Dow Jones Industrial Average (+0.3%) did set closing record highs. The Russell 2000 increased 0.1% while the Nasdaq Composite decreased 0.1%. The Dow also set an intraday record high and extended its winning streak to six sessions.

Trading conditions remained thin, particularly at the NYSE, ahead of the new year festivities at the end of the week. That observation, plus the lack of market-moving news, suggested that there wasn't a lot of conviction in today's trading activities.

Eight of the 11 S&P 500 sectors closed higher, yet no sector rose more than 0.7%. The health care (+0.6%) and real estate (+0.6%) sectors tied for the lead, while the communication services (-0.3%), energy (-0.6%), and financials (-0.1%) sectors finished in negative territory.

The lack of conviction was further manifested in bank stocks showing little interest to the steepening activity in the Treasury market. Likewise, the energy sector closed lower despite an increase in oil prices ($76.57/bbl, +0.56, +0.7%). The SPDR S&P Bank ETF (KBE 54.84, +0.06) increased just 0.1%.

The 10-yr yield rose six basis points to 1.54% while the 2-yr yield was unchanged at 0.75%. The U.S. Dollar Index decreased 0.3% to 95.91.

Growth stocks, which were purportedly trading lower intraday because of the higher rates, recouped losses as the session progressed. The Russell 1000 Growth Index (+0.04%) closed fractionally higher after being down 0.5% intraday.

The 9.5% gain in Biogen (BIIB 258.31, +22.32, +9.5%), however, was linked to a specific catalyst. The Korea Economic Daily reported that the company in in talks to be acquired by Samsung Group for more than $40 billion.

Airlines stocks faced renewed selling interest after Delta (DAL 39.16, -0.47, -1.2%) and Alaska Airlines (ALK 52.14, -0.76, -1.4%) canceled/delayed hundreds more flights due to weather and Omicron issues. The U.S. Global Jets ETF (JETS 21.14, -0.32) declined 1.5%.

Reviewing Wednesday's economic data:

The Advance International Trade in Goods report for November showed a deficit of $97.8 billion, up $14.6 billion from October. The Advance report for Retail Inventories for November increased 2.0%, while the Advance report for Wholesale Inventories for November increased 1.2%.
Pending home sales fell 2.2% m/m in November (Briefing.com consensus +0.6%) following a 7.5% jump in October.

Looking ahead, investors will receive the weekly Initial and Continuing Claims report on Thursday.

S&P 500 +27.6% YTD
Nasdaq Composite +22.3% YTD
Dow Jones Industrial Average +19.2% YTD
Russell 2000 +13.9% YTD

Crude futures settle higher, but energy stocks underperform
29-Dec-21 15:30 ET
Dow +148.87 at 36547.08, Nasdaq -20.87 at 15760.84, S&P +11.17 at 4797.52

[BRIEFING.COM] The S&P 500 is up 0.2% and is vying for a record close.

Nine sectors are supporting the effort, led by health care (+0.7%) and real estate (+0.7%) with 0.7% gains. The energy (-0.3%) and communication services (-0.3%) sectors are the two holdouts.

WTI crude futures settled higher by 0.7%, or $0.56, to $76.57/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36398.21 +95.83 (0.26%)
Nasdaq 15781.71 -89.54 (-0.56%)
SP 500 4786.35 -4.84 (-0.10%)
10-yr Note +2/32 1.461
NYSE Adv 1534 Dec 1718 Vol 568.4 mln
Nasdaq Adv 1582 Dec 2993 Vol 3.6 bln

Industry Watch
Strong: Utilities, Materials, Industrials
Weak: Information Technology, Health Care

Moving the Market

-- S&P 500 sets record high above the 4800 level but closes lower

-- CDC shortens the recommended isolation time for asymptomatic people with COVID-19 to five days from 10 days

-- Relative weakness in the information technology sector

-- Low volume at the NYSE

S&P 500 tags record high, then closes lower
28-Dec-21 16:20 ET
Dow +95.83 at 36398.21, Nasdaq -89.54 at 15781.71, S&P -4.84 at 4786.35

[BRIEFING.COM] The S&P 500 decreased 0.1% on Tuesday after setting an intraday record high above the 4800 level early in the day. The Nasdaq Composite (-0.6%) and Russell 2000 (-0.7%) underperformed in negative territory, while the Dow Jones Industrial Average (+0.3%) rose modestly.

The session started with a carryover of positive momentum, with some attributing updated COVID-19 guidance from the CDC as a supportive factor. The public health agency shortened the recommended isolation time for asymptomatic people with COVID-19 to five days from 10 days.

Seasonal factors also lent support, but the market appeared to be running on tired legs. Entering the session, the S&P 500 was up 4.9% over the prior four sessions while the Nasdaq Composite and Russell 2000 were up nearly 6.0% over the same period. Selling interest was kept in check, though, on this low-volume day.

Seven of the 11 S&P 500 sectors closed in positive territory with the utilities sector (+0.9%) claiming the top spot with a 0.9% gain. The information technology sector (-0.6%), which led the market higher yesterday, slipped into the laggard position with a 0.6% decline.

The technology sector was pressured by losses in Apple (AAPL 179.20, -1.13, -0.6%), Microsoft (MSFT 341.35, -1.13, -0.3%), and the semiconductor stocks. The Philadelphia Semiconductor Index fell 1.2%.

Travel stocks saw some relief following the updated CDC guidance on the hope that there will be less Omicron-related disruptions. On a related note, Booking Holdings (BKNG 2386.91, -7.60, -0.3%) CEO told CNBC that he thinks the travel recovery will continue in 2022, even with the Omicron variant.

Value stocks in general fared better than their growth-stock peers. The Russell 1000 Value Index increased 0.2% while the Russell 1000 Growth Index fell 0.5%.

In the Treasury market, the 2-yr yield rose five basis points to 0.75% while the 10-yr yield settled unchanged at 1.48% after trading at 1.46% intraday. The U.S. Dollar Index increased 0.1% to 96.14. WTI crude futures increased 0.6%, or $0.45, to $76.01/bbl.

Reviewing Tuesday's economic data:

The S&P Case-Shiller Home Price Index increased 18.4% yr/yr in October (Briefing.com consensus 18.7%) following a 19.1% yr/yr increase in September.
The FHFA Housing Price Index increased 1.1% m/m in October following a 0.9% increase in September.

Looking ahead, investors will receive Pending Home Sales for November, the weekly MBA Mortgage Applications Index, and the Advance November reports for Intl Trade in Goods, Retail Inventories, and Wholesale Inventories on Wednesday.

S&P 500 +27.4% YTD
Nasdaq Composite +22.5% YTD
Dow Jones Industrial Average +18.9% YTD
Russell 2000 +13.8% YTD

Crude futures settle at $76 per barrel
28-Dec-21 15:30 ET
Dow +112.21 at 36414.59, Nasdaq -66.39 at 15804.86, S&P -2.18 at 4789.01

[BRIEFING.COM] The S&P 500 is trading flat while the Russell 2000 trades lower by 0.4%.

One last look at the sectors shows utilities (+0.7%), industrials (+0.5%), and materials (+0.5%) outperforming with modest gains. Conversely, the information technology (-0.5%), health care (-0.3%), and communication services (-0.3%) sectors are trading lower.

WTI crude futures settled higher by 0.6%, or $0.45, to $76.01/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 36302.38 +351.82 (0.98%)
Nasdaq 15871.25 +217.89 (1.39%)
SP 500 4791.19 +65.40 (1.38%)
10-yr Note +1/32 1.485
NYSE Adv 2204 Dec 1068 Vol 615.6 mln
Nasdaq Adv 2373 Dec 2279 Vol 3.7 bln

Industry Watch
Strong: Information Technology, Energy, Real Estate
Weak: Utilities

Moving the Market

-- S&P 500 sets intraday and closing record highs

-- Leadership from the mega-caps

-- Travel stocks underperformed amid Omicron-related disruptions

S&P 500 extends rally to record highs
27-Dec-21 16:15 ET
Dow +351.82 at 36302.38, Nasdaq +217.89 at 15871.25, S&P +65.40 at 4791.19

[BRIEFING.COM] The S&P 500 rose 1.4% on Monday, setting intraday and closing record highs in a steady advance. The Nasdaq Composite (+1.4%) kept pace, followed by the Dow Jones Industrial Average (+1.0%) and Russell 2000 (+0.9%) with solid gains.

The market didn't seem drawn to any specific piece of news, nor was there any economic data to influence investing decisions. Instead, the market appeared to benefit from a continued willingness among investors to buy equities when momentum remained in their favor, particularly at a seasonally-favorable time of the year.

All 11 S&P 500 sectors closed higher, led by the information technology (+2.2%), energy (+2.2%), and real estate (+2.0%) sectors with gains of at least 2.0%. The utilities sector underperformed on a relative basis with a 0.5% gain.

Retail investors might have had a greater role today based on the light trading volume at the NYSE and the huge gains in market favorites like Apple (AAPL 180.33, +4.05, +2.3%), Microsoft (MSFT 342.45, +7.76, +2.3%), Meta Platforms (FB 346.18, +10.94, +3.3%), Tesla (TSLA 1093.94, +26.94, +2.5%), and NVIDIA (NVDA 309.45, +13.05, +4.4%).

The mega-cap growth stocks did the heavy lifting while small-caps and micro-caps went along for the ride, as did value stocks. The Russell 1000 Growth Index rose 1.5%, versus a 1.1% gain in the Russell 1000 Value Index.

Looking at industry news, travel stocks struggled amid reports highlighting the disruptions that airlines and cruise lines have faced because of Omicron-related issues. Retail stocks benefited from Mastercard SpendingPulse data indicating that retail sales grew 8.5% year-over-year this holiday season (Nov. 1-Dec. 24).

U.S. Treasuries settled mixed with a trace of curve-flattening activity. The 2-yr yield increased one basis point to 0.70% while the 10-yr yield decreased one basis point to 1.48%. The U.S. Dollar Index increased 0.1% to 96.08. WTI crude futures rose 2.3%, or $1.71, to $75.56/bbl.

Investors did not receive any economic data on Monday. Looking ahead, the FHFA Housing Price Index for October and the S&P Case-Shiller Home Price Index for October will be released on Tuesday.

S&P 500 +27.6% YTD
Nasdaq Composite +23.1% YTD
Dow Jones Industrial Average +18.6% YTD
Russell 2000 +14.5% YTD

Crude futures settle above $75 per barrel
27-Dec-21 15:30 ET
Dow +282.65 at 36233.21, Nasdaq +190.01 at 15843.37, S&P +55.43 at 4781.22

[BRIEFING.COM] The S&P 500 is up 1.2% while the Russell 2000 is up 0.5%.

One last look at the sectors shows energy (+2.0%), information technology (+1.9%), real estate (+1.4%), and materials (+1.3%) up between 1-2% while the utilities sector is up just 0.3%.

WTI crude futures settled higher by 2.3%, or $1.71, to $75.56/bbl.

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Market Snapshot

https://www.briefing.com/stock-market-update

Dow 35950.56 +196.67 (0.55%)
Nasdaq 15653.36 +131.48 (0.85%)
SP 500 4725.79 +29.23 (0.62%)
10-yr Note -26/32 1.499
NYSE Adv 2223 Dec 1060 Vol 647.7 mln
Nasdaq Adv 3181 Dec 1409 Vol 3.9 bln

Industry Watch
Strong: Consumer Discretionary, Industrials, Materials
Weak: Real Estate, Utilities

Moving the Market

-- S&P 500 closes at record high as the rebound momentum persisted

-- Decent economic data, although PCE Prices for November remained hot

-- Relatively light trading volume at the NYSE in front of the Christmas weekend

S&P 500 closes at record high in front of Christmas weekend
23-Dec-21 16:15 ET
Dow +196.67 at 35950.56, Nasdaq +131.48 at 15653.36, S&P +29.23 at 4725.79

[BRIEFING.COM] The S&P 500 rose 0.6% on Thursday, wrapping up the Christmas week at a closing record high amid buy-the-dip momentum. The Dow Jones Industrial Average also gained 0.6% while the Nasdaq Composite (+0.9%) and Russell 2000 (+0.9%) both gained 0.9%.

Most of the gains were registered shortly after the open, and the major indices slowly drifted slowly higher the rest of the session. There was a slight hiccup into the close, which might have been a byproduct of reduced trading volume at the NYSE and efforts to take some money off the table in front of a three-day weekend.

Nine of the 11 S&P 500 sectors closed higher with consumer discretionary (+1.2%), industrials (+1.2%), and materials (+1.0%) each rising at least 1.0%. The real estate (-0.4%) and utilities (-0.03%) sectors closed slightly lower.

Today's economic data was decent: weekly initial claims, new home sales for November, durable goods orders for November, and the final December reading for the University of Michigan Index of Consumer Sentiment were each better than expected. Personal income and spending for November increased modestly.

One of the wrinkles in the data was a hotter-than-expected core PCE Price Index, which increased 0.5% m/m in November (Briefing.com consensus 0.4%) and was up 4.7% yr/yr. The PCE Price Index increased 0.6% m/m, leaving it up 5.7% yr/yr.

In COVID news, the FDA issued an emergency use authorization for Merck’s (MRK 75.73, -0.43, -0.6%) oral antiviral for the treatment of mild-to-moderate coronavirus disease for adults 18 and older. Research continued to suggest that the Omicron variant is milder than the Delta variant despite being more contagious.

The Treasury market softened up, driving yields higher, which was in-line with typical trading behavior when equities rally and the economic data leans positive. The 2-yr yield increased three basis points to 0.69%, and the 10-yr yield increased four basis points to 1.49%.

The U.S. Dollar Index decreased 0.1% to 96.03. WTI crude futures rose 1.2%, or $0.85, to $73.62/bbl.

Reviewing Thursday's economic data:

Personal income increased 0.4% month-over-month in November (Briefing.com consensus 0.5%) and personal spending increased 0.6% (Briefing.com consensus 0.6%). The PCE Price Index was up 0.6% month-over-month and the core PCE Price Index, which excludes food and energy, was up 0.5% (Briefing.com consensus 0.4%). On a year-over-year basis, the PCE Price Index was up 5.7%, versus 5.1% in October, and the core PCE Price Index was up 4.7%, versus 4.2% in November.
The key takeaway from the report is that the bad inflation data should keep the Fed focused on gearing its monetary policy toward battling inflation as opposed to the slowdown effect of the Omicron variant.
Initial jobless claims for the week ending December 18 were unchanged at 205,000 (Briefing.com consensus 206,000). Continuing claims for the week ending December 11 decreased by 8,000 to 1.859 million.
The key takeaway from the report is that it covers the week in which the survey for the December Employment Situation Report is conducted. With the low level of initial claims, economists should be predicting some relatively strong gains in December nonfarm payrolls.
New home sales increased 12.4% month-over-month in November to a seasonally adjusted annual rate of 744,000 units (Briefing.com consensus 770,000) from a downwardly revised 662,000 (from 745,000) in October. On a year-over-year basis, new home sales were down 14.0%.
The key takeaway from the report is that the growth in new home sales is concentrated in higher-priced homes, as inflation pressures, exacerbated by supply constraints and labor shortages, are curtailing the building of lower-priced homes and pinching affordability for lower-income buyers.
The final December reading for the University of Michigan Index of Consumer Sentiment came in at 70.6 (Briefing.com consensus 70.4) versus the preliminary reading of 70.4. The final reading for November was 67.4.
The key takeaway from the report is that the improvement was driven by higher income expectations among households in the bottom third of the income distribution, which has been sparked by higher wages for younger workers and a 5.9% increase in Social Security payments for 2022.
Durable goods orders increased 2.5% month-over-month in November (Briefing.com consensus 1.5%). Excluding transportation, durable goods orders rose 0.8% (Briefing.com consensus 0.6%).
The key takeaway from the report is that there was some slowing in business spending in November, evidenced by the 0.1% decline in orders for nondefense capital goods excluding aircraft. It is worth pointing out, however, that this small decline comes on the heels of steady increases in orders for these goods, so it can still be viewed as a natural slowing after a strong period of gains as opposed to anything more severe in meaning.

There is no economic data scheduled for Monday, whish is when the market reopens from holiday.

S&P 500 +25.8% YTD
Nasdaq Composite +21.5% YTD
Dow Jones Industrial Average +17.5% YTD
Russell 2000 +13.5% YTD

Crude futures settle higher
23-Dec-21 15:30 ET
Dow +269.03 at 36022.92, Nasdaq +145.33 at 15667.21, S&P +37.20 at 4733.76

[BRIEFING.COM] The S&P 500 continues to trade higher by 0.8% and is on track to close at a record high.

One last look at the sector performances shows industrials (+1.3%), consumer discretionary (+1.2%), and materials (+1.2%) in the lead with gains over 1.0%, while the real estate sector (-0.3%) is the lone holdout with a 0.3% decline.

WTI crude futures settled higher by 1.2%, or $0.85, to $73.62/bbl.