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Strong finish leads to record closes
15-Mar-21 16:15 ET
Dow +174.82 at 32953.46, Nasdaq +139.84 at 13459.72, S&P +25.60 at 3968.94
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 (+0.7%), Dow Jones Industrial Average (+0.5%), and Russell 2000 (+0.3%) set intraday and closing record highs on Monday, thanks to a strong finish in the last 30 minutes of action. The Nasdaq Composite (+1.1%) outperformed with a 1.1% gain.
The session started on a meek note, with the major indices dipping into negative territory on no specific catalyst other than an apparent case of the Monday's after clocks moved forward an hour on Sunday. Classically, investors bought the intraday dip (S&P 500 was down 0.5% at its low), and nine of the 11 S&P 500 sectors closed in the green as buyers followed through.
The information technology (+1.1%) and consumer discretionary (+1.2%) sectors provided the influential leadership for the benchmark index and were accompanied by the lightly-weighted utilities (+1.4%) and real estate (+1.2%) sectors. The Philadelphia Semiconductor Index advanced 2.3%.
The energy (-1.3%) and financials (-0.6%) sectors, however, struggled throughout the day amid lower oil prices ($65.28/bbl, -0.25, -0.4%) and a decline in long-term interest rates, respectively. The 2-yr yield was unchanged at 0.14%, while the 10-yr yield decreased two basis points to 1.61%. The U.S. Dollar Index increased 0.1% to 91.78.
Travel-related stocks like airlines and casinos were among the biggest gainers amid lingering reopening optimism.
The U.S. Global Jets ETF (JETS 28.71, +1.03, +3.7%) closed at a 52-week high after TSA data showed the highest number of passengers last Friday in a year and several airlines, including Southwest (LUV 62.10, +1.07, +1.8%) and Spirit (SAVE 39.31, +0.69, +1.8%), provided operational updates that highlighted improved bookings activity in March for leisure-based travel.
Positive catalysts in the casino space included Nevada casinos increasing capacity to 50%, media reports highlighting big crowds at the Las Vegas strip, Jefferies upgrading MGM Resorts (MGM 40.96, +1.98, +5.1%) to Buy from Hold, and the S&P Dow Jones Indices naming Penn Natl Gaming (PENN 136.47, +6.00, +4.6%) and Caesars Entertainment (CZR 101.20, +0.58, +0.6%) to the S&P 500, effective March 22.
Separately, shares of Eli Lilly (LLY 189.16, -18.92, -9.1%) dropped 9% after failing to impress shareholders with expanded Phase 2 trial data for its Alzheimer's Disease drug, donanemab. Similarly, shares of Biogen (BIIB 260.13, -6.00, -2.3%) declined 2% following some cautious commentary for its Alzheimer's treatment at an analyst call.
Monday's economic data was limited to the Empire State Manufacturing Survey, which increased to 17.4 in March (Briefing.com consensus 15.0) from 12.1 in February. Looking ahead to Tuesday, investors will receive Retail Sales for February, Industrial Production and Capacity Utilization for February, the NAHB Housing Market Index for March, Business Inventories for January, and Import and Export Prices for February.
Russell 2000 +19.5% YTD
Dow Jones Industrial Average +7.7% YTD
S&P 500 +5.7% YTD
Nasdaq Composite +4.4% YTD
Market Snapshot
Dow 32953.46 +174.82 (0.53%)
Nasdaq 13459.72 +139.84 (1.05%)
SP 500 3968.94 +25.60 (0.65%)
10-yr Note +2/32 1.614
NYSE Adv 2037 Dec 1216 Vol 974.0 mln
Nasdaq Adv 2304 Dec 1768 Vol 5.8 bln
Industry Watch
Strong: Information Technology, Consumer Discretionary, Utilities, Real Estate,
Weak: Financials, Energy
Moving the Market
-- S&P 500, Dow, and Russell 2000 set intraday and closing record highs
-- Nasdaq and travel-related stocks outperformed
-- Weakness in financial and energy stocks
Energy stocks underperform amid lower oil prices
15-Mar-21 15:30 ET
Dow +40.98 at 32819.62, Nasdaq +70.45 at 13390.33, S&P +7.58 at 3950.92
[BRIEFING.COM] The S&P 500 is trading higher by 0.2%, while the Russell 2000 trades lower by 0.1%.
One last look at the S&P 500 sectors shows utilities (+1.1%) and real estate (+1.1%) still atop the standings with 1.1% gains, followed by consumer discretionary (+0.7%). The energy (-1.6%), financials (-1.1%), and materials (-0.3%) sectors underperform in negative territory.
WTI crude futures settled lower by $0.25 (-0.4%) to $65.28/barrel.
S&P 500 absorbs higher rates, closes at record high
12-Mar-21 16:20 ET
Dow +293.05 at 32778.64, Nasdaq -78.81 at 13319.88, S&P +4.00 at 3943.34
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 (+0.1%) eked out a closing record high on Friday, coming back from an early 0.6% decline as it gradually absorbed another sharp rise in long-term interest rates. The 10-yr yield rose 11 basis points to 1.64% to reach its highest level since last February.
The Dow Jones Industrial Average (+0.9%) and Russell 2000 (+0.6%) set intraday and closing record highs, while the Nasdaq Composite declined 0.6% amid relative weakness in the mega-cap/growth stocks. To the Nasdaq's credit, it was down as much as 1.8% intraday due to the initial shock of higher rates.
The sharp rise in yields was driven by widely-reported expectations for economic growth and inflation. These expectations were supported by President Biden's instruction that all states make all adults eligible to be vaccinated no later than May 1 and by pipeline inflation pressures that were evident in the February Producer Price Index report.
Some circles attributed the rise in yields to a more subtle factor: selling by primary dealers anticipating that the Fed isn't going to extend the supplementary leverage ratio exemption when it expires March 31. This exemption was introduced last April amid the economic meltdown brought on by the pandemic.
Whatever the case, the higher rates worked against the mega-cap stocks within the S&P 500 information technology (-0.7%), communication services (-0.9%), and consumer discretionary (+0.1%) sectors. The latter sneaked into positive territory into the close amid a familiar resiliency in the broad market.
The financials sector (+1.1%) was a direct beneficiary of the curve-steepening activity in Treasuries, although the top spots belonged to the real estate (+1.5%), industrials (+1.3%), and utilities (+1.3%) sectors.
Boeing (BA 269.19, +17.19, +6.8%) was an influential driver within the industrials sector on news that 777 Investment Partners ordered 24 737 MAX planes. BA shares rose 7% to fresh 52-week highs.
The 2-yr yield increased one basis point to 0.14%. The U.S. Dollar Index increased 0.2% to 91.63. WTI crude futures rose 0.7%, or $0.43, to $65.59/bbl.
Reviewing Friday's economic data:
The Producer Price Index for final demand increased 0.5% m/m in February, as expected, following a 1.3% increase in January. In turn, the Producer Price Index for final demand, less foods and energy, rose 0.2% m/m, as expected, following a 1.2% increase in January. On a year-over-year basis, the Producer Price Index for final demand was up 2.8%, versus 1.7% in January. The Producer Price Index for final demand, less foods and energy, was up 2.5% versus 2.0% in January.
There are a few important takeaways from this report: (1) there were no surprises in the headline numbers, so the stock market could choose to turn a blind eye to it, but (2) there was a sightline to pipeline inflation pressures, as the index for processed goods for intermediate demand rose 2.7% m/m (up 6.6% yr/yr), the largest monthly increase since July 2008, while the index for unprocessed goods for intermediate demand increased 4.3% (up 19.0% yr/yr).
The preliminary University of Michigan Index of Consumer Sentiment for March increased to 83.0 (Briefing.com consensus 80.0) from the final reading of 76.8 for February. The March reading is the highest since August 2020.
The key takeaway from the report is that the improvement was driven by gains across all socioeconomic subgroups and stemmed from optimism about the increasing number of vaccinations and the passage of the $1.9 trillion stimulus package.
Looking ahead, investors will receive the Empire State Manufacturing Survey for March and Net Long-Term TIC Flows for January on Monday.
Russell 2000 +19.1% YTD
Dow Jones Industrial Average +7.1% YTD
S&P 500 +5.0% YTD
Nasdaq Composite +3.4% YTD
Market Snapshot
Dow 32778.64 +293.05 (0.90%)
Nasdaq 13319.88 -78.81 (-0.59%)
SP 500 3943.34 +4.00 (0.10%)
10-yr Note -29/32 1.617
NYSE Adv 1816 Dec 1392 Vol 947.1 mln
Nasdaq Adv 2172 Dec 1818 Vol 5.4 bln
Industry Watch
Strong: Financials, Industrials, Utilities, Real Estate
Weak: Information Technology, Communication Services
Moving the Market
-- New highs for S&P 500, Dow, and Russell 2000 as market absorbed another spike in long-term interest rates
-- 10-yr yield rose 11 basis points to 1.64% amid continued expectations for economic growth and inflation
WTI crude futures settle higher
12-Mar-21 15:30 ET
Dow +248.21 at 32733.80, Nasdaq -107.94 at 13290.75, S&P -1.59 at 3937.75
[BRIEFING.COM] The S&P 500 is trading fractionally below its flat line, and any positive finish would be good for a record close.
Nine of the S&P 500 sectors are now trading higher, led by the industrials (+1.2%), utilities +(1.3%), and financials (+0.9%) sectors. The information technology (-0.9%) and communication services (-1.0%) sectors remain in negative territory.
WTI crude futures settled higher by 0.7%, or $0.43, to $65.59/bbl.
Record highs for S&P 500, Dow, and Russell 2000
11-Mar-21 16:15 ET
Dow +188.57 at 32485.59, Nasdaq +329.84 at 13398.69, S&P +40.53 at 3939.34
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 (+1.0%), Dow Jones Industrial Average (+0.6%), and Russell 2000 (+2.3%) set intraday and closing record highs on Thursday. The Nasdaq Composite (+2.5%) played catch-up with a 2.5% gain, as the mega-cap/growth stocks found renewed buying interest.
The session started on a high note in a momentum trade, with the Dow quickly notching its fourth all-time high in four days and the broader market attracting follow through from buyers amid a fear of missing out on further gains. Today was the first closing record high for the S&P 500 since Feb. 12, thanks to an impressive 5.6% rally off last Friday's session low.
The information technology (+2.1%), communication services (+1.8%), and consumer discretionary (+1.6%) sectors, which contain many of the recently-battered mega-caps and growth stocks, did the heavy lifting. The bullish bias, however, did lose steam in the afternoon, with selling interest leaking into the financials (-0.3%), utilities (-0.3%), and consumer staples (-0.2%) sectors.
Nonetheless, there were some positive-sounding news events that supported risk sentiment.
Briefly, President Biden signed the $1.9 trillion stimulus bill one day earlier than expected, allowing some payments to reach bank accounts as soon as this weekend; weekly initial claims decreased by 42,000 to 712,000 (Briefing.com consensus 725,000); and the ECB said it expects to conduct asset purchases at a significantly higher pace over the next quarter than during the first months of this year.
Longer-dated Treasury yields continued to climb off overnight lows following the ECB statement before leveling off during the trading session, which included a $24 billion 30-yr bond reopening auction that was met with tepid demand. It was good enough for stocks, though, just like the 3-yr note and 10-yr note auctions earlier this week.
The 10-yr yield increased one basis point to 1.53% after touching 1.48% at its low and 1.55% at its high, while the 2-yr yield decreased two basis points to 0.13%. The U.S. Dollar Index decreased 0.5% to 91.37. WTI crude futures rose 2.4%, or $1.57, to $66.02/bbl.
Separately, Oracle (ORCL 67.44, -4.68, -6.5%) and General Electric (GE 12.27, -0.98, -7.4%) were eyesores on this record-setting day. Oracle underwhelmed investors with its earnings report and guidance. GE was downgraded to Perform from Outperform at Oppenheimer.
Reviewing Thursday's economic data:
Initial jobless claims for the week ending March 6 decreased by 42,000 to 712,000 (Briefing.com consensus 725,000), which is the lowest level of claims since the first week of last November. Continuing claims for the week ending February 27 decreased by 193,000 to 4.144 million.
The key takeaway from the initial jobless claims data is that initial claims are still high, but at least they are moving in a direction that suggests the economy is finding its growth stride again. To wit, in the first week of January, initial jobless claims were 927,000.
Job openings increased to 6.917 million in January from a revised 6.752 million in December (from 6.646 million).
Looking ahead, investors will receive the Producer Price Index for February and the preliminary University of Michigan Index of Consumer Sentiment for March on Friday.
Russell 2000 +18.4% YTD
Dow Jones Industrial Average +6.1% YTD
S&P 500 +4.9% YTD
Nasdaq Composite +4.0% YTD
Market Snapshot
Dow 32485.59 +188.57 (0.58%)
Nasdaq 13398.69 +329.84 (2.52%)
SP 500 3939.34 +40.53 (1.04%)
10-yr Note -1/32 1.542
NYSE Adv 2375 Dec 853 Vol 1.1 bln
Nasdaq Adv 3144 Dec 861 Vol 5.9 bln
Industry Watch
Strong: Information Technology, Consumer Discretionary, Communication Services
Weak: Financials, Utilities, Consumer Staples
Moving the Market
-- S&P 500, Dow, and Russell 2000 set intraday and closing record highs
-- Renewed interest in the mega-cap/growth stocks
-- Fear of missing out on further gains
-- President Biden signed the $1.9 trillion stimulus bill, ECB provides dovish commentary surrounding asset purchases
WTI crude futures settle above $66 per barrel
11-Mar-21 15:25 ET
Dow +227.20 at 32524.22, Nasdaq +339.96 at 13408.81, S&P +45.97 at 3944.78
[BRIEFING.COM] The S&P 500 is trading higher by 1.2% and is on track to close at its first record high since Feb. 12.
One last look at the S&P 500 sectors shows the information technology (+2.3%), communication services (+2.0%), and consumer discretionary (+1.7%) sectors still leading the advance. Conversely, the financials (-0.3%) and consumer staples (-0.1%) sectors are struggling below their flat lines.
WTI crude futures settled higher by 2.4%, or $1.57, to $66.02/bbl.
Pro-cyclical trade extends record-setting advance in Dow
10-Mar-21 16:20 ET
Dow +464.28 at 32297.02, Nasdaq -4.99 at 13068.85, S&P +23.37 at 3898.81
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 advanced 0.6% on Wednesday, as value and cyclical stocks reclaimed their recent leadership roles and inflation concerns were put on hold. The pro-cyclical trade disproportionally benefited the Dow Jones Industrial Average (+1.5%) and Russell 2000 (+1.8%), with the Dow setting intraday and closing record highs.
The Nasdaq Composite (-0.04%), however, closed slightly lower after being up as much as 1.6% intraday. The S&P 500 information technology sector (-0.4%) and Philadelphia Semiconductor Index (-1.8%) were other growth-stock pockets of weakness.
Prior to the open, the February Consumer Price Index (CPI) report didn't reveal any surprising upticks in inflation, with total CPI increasing an expected 0.4% m/m and core CPI increasing just 0.1% (Briefing.com consensus +0.2%). The yr/yr increases remained below 2.0%, although many still expect upwards pressure in the coming months.
Notwithstanding those inflation expectations, equity futures reacted positively to the report, long-term interest rates backed down from pre-CPI highs, and most stocks opened in positive territory. Ten of the 11 S&P 500 sectors closed higher, including the cyclical energy (+2.6%), financials (+1.9%), and materials (+1.6%) sectors atop the standings on the back of follow through from buyers.
The so-called reopening trade was aided by the House passing the $1.9 trillion stimulus bill, as expected, and New York Governor Cuomo saying that restaurants in New York City and New Jersey will expand indoor dining to 50% beginning March 19.
Like the price action in the Nasdaq, the information technology sector (-0.4%) was up as much as 1.1% in early action, briefly adding to Tuesday's 3.4% gain. Amid a lack of negative catalysts, the rebound rally in growth stocks appeared gassed out, even as Treasury yields declined.
The 10-yr yield decreased three basis points to 1.52%, with the market showing little reaction to the tepid $38 billion 10-yr note auction in the afternoon. The 2-yr yield decreased one basis point to 0.15%. The U.S. Dollar Index decreased 0.2% to 91.79. WTI crude futures increased 0.7%, or $0.43, to $64.45/bbl.
In corporate news, Roblox (RBLX 69.50, +24.50, +54.4%) had a solid public debut at the NYSE. General Electric (GE 13.25, -0.75, -5.4%) lowered its FY21 EPS guidance following its confirmed merger deal between its aircraft leasing business and AerCap (AER 53.39, -2.61, -4.7%).
Reviewing Wednesday's economic data:
Total CPI increased 0.4% m/m, as expected, while core CPI, which excludes food and energy, rose 0.1% (Briefing.com consensus 0.2%). The monthly changes left total CPI up 1.7% yr/yr, versus 1.4% in January; however, the yr/yr increase in core CPI edged lower to 1.3% from 1.4% in January.
The key takeaway from the report is the recognition that it didn't contain any headline surprises today to fan the flames of inflation concerns, which many expect to fire up in coming months.
The February Treasury Budget showed a $310.9 bln deficit, versus a $235.3 bln deficit in the same period a year ago. The budget data is not seasonally adjusted, so the February deficit can't be compared to the January deficit of $162.8 bln.
The fiscal year-to-date budget deficit is $1.05 trln versus -$624.5 bln for the same period a year ago. The budget deficit over the last 12 months is $3.55 trln versus -$3.48 trln in January.
The weekly MBA Mortgage Applications Index decreased 1.3% following a 0.5% increase in the prior week.
Looking ahead, investors will receive the weekly Initial and Continuing Claims report on Thursday.
Russell 2000 +15.7% YTD
Dow Jones Industrial Average +5.5% YTD
S&P 500 +3.8% YTD
Nasdaq Composite +1.4% YTD
Market Snapshot
Dow 32297.02 +464.28 (1.46%)
Nasdaq 13068.85 -4.99 (-0.04%)
SP 500 3898.81 +23.37 (0.60%)
10-yr Note -1/32 1.542
NYSE Adv 2357 Dec 823 Vol 1.2 bln
Nasdaq Adv 2480 Dec 1422 Vol 5.9 bln
Industry Watch
Strong: Financials, Energy, Materials
Weak: Information Technology, Communication Services
Moving the Market
-- Stocks trade higher in broad-based advance led by value/cyclical stocks
-- Dow hits another all-time high
-- February CPI report eases inflation concerns
WTI crude futures settle in positive territory
10-Mar-21 15:25 ET
Dow +528.35 at 32361.09, Nasdaq +30.61 at 13104.45, S&P +32.90 at 3908.34
[BRIEFING.COM] The major indices continue to trade broadly higher, with the Russell 2000 out in the lead with a 1.9% gain. The Nasdaq underperforms with a 0.3% gain.
One last look at the S&P 500 sectors shows energy (+2.5%), materials (+2.0%), and financials (+2.0%) trading higher by at least 2.0%, while the information technology (-0.03%) remains the only sector trading lower amid relative weakness in its growth-stock components.
A turnaround in oil prices has aided energy stocks. WTI crude futures settled higher by 0.7%, or $0.43, to $64.45/bbl after trading modestly lower intraday.
Nasdaq and growth stocks bounce back
09-Mar-21 16:15 ET
Dow +30.30 at 31832.74, Nasdaq +464.66 at 13073.84, S&P +54.09 at 3875.44
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 advanced 1.4% on Tuesday in a strong rebound session for the mega-cap/growth stocks, which boosted the Nasdaq Composite to a 3.7% gain. The Russell 2000 (+1.9%) finished in the middle with a 1.9% gain, while the Dow Jones Industrial Average increased just 0.1% after it was up as much as 1.1% intraday and at fresh record highs.
After yesterday's session left the Nasdaq down 10.5% from its recent high, or in "correction territory," investors presumably felt that the underlying declines at the growth-stock level had gotten too extended and presented a good buying opportunity. Follow through from buyers after a strong open fueled the technically-oriented rebound rally.
Shares of Tesla (TSLA 673.58, +110.58, +19.6%) surged nearly 20% today, further supported by an analyst upgrade to Buy from Neutral at New Street and a report that it grabbed market share from Chinese EV competitors in February. Note, TSLA shares entered the session down 37% from its all-time high, partially due to the rotation into value/cyclical stocks.
The S&P 500 consumer discretionary sector, which is home to Tesla, rose 3.8%, and the top-weighted information technology sector rose 3.4%. The Vanguard Mega Cap Growth ETF (MGK 201.96, +6.88, +3.5%) rose 3.5%, the Philadelphia Semiconductor Index rose 6.1%, and the ARK Innovation ETF (ARKK 121.75, +11.49, +10.4%) rose 10.4%.
Interestingly, the broad market did lose some traction into the close as the S&P 500 struggled to stay above the 3900 level, which has acted as resistance this month.
The red-hot energy (-1.9%) and financials (-0.9%) sectors underperformed in negative territory. Energy stocks were pressured by lower oil prices ($64.02, -1.02, -1.6%), while financial stocks were slowed down by a decline in longer-dated Treasury yields.
The 10-yr yield decreased five basis points to 1.55%, while the 2-yr yield increased one basis point to 0.16%. The U.S. Dollar Index decreased 0.4% to 91.97. On a related note, the $58 bln 3-year note auction was a nonevent, which was viewed in a positive light because the results revealed little concern about demand. Long-term interest rates ticked lower in response.
Boeing (BA 230.61, +6.58, +2.9%) was a notable Dow gainer after The New York Times reported that the company sold 31 planes in February, representing its first positive month in over a year. Stitch Fix (SFIX 49.23, -19.29, -28.2%) was a notable growth-stock laggard, plunging 28% after missing revenue estimates.
Tuesday's economic data was limited to the NFIB Small Business Optimism Index, which increased to 95.8 in February from 95.0 in January. Looking ahead to Wednesday, investors will receive the Consumer Price Index for February, the Treasury Budget for February, and the weekly MBA Mortgage Applications Index.
Russell 2000 +13.7% YTD
Dow Jones Industrial Average +4.0% YTD
S&P 500 +3.2% YTD
Nasdaq Composite +1.4% YTD
Market Snapshot
Dow 31832.74 +30.30 (0.10%)
Nasdaq 13073.84 +464.66 (3.69%)
SP 500 3875.44 +54.09 (1.42%)
10-yr Note +27/32 1.539
NYSE Adv 1937 Dec 1253 Vol 1.1 bln
Nasdaq Adv 2865 Dec 1072 Vol 6.2 bln
Industry Watch
Strong: Information Technology, Consumer Discretionary
Weak: Energy, Financials, Industrials, Consumer Staples
Moving the Market
-- Technically-oriented bounce in the mega-cap/growth stocks
-- Longer-dated Treasury yields pulled back
-- Tesla (TSLA) rebounds nearly 20%
-- 3900 level in the S&P 500 acted as resistance again
WTI crude futures settle in negative territory
09-Mar-21 15:25 ET
Dow +195.16 at 31997.60, Nasdaq +531.93 at 13141.11, S&P +74.98 at 3896.33
[BRIEFING.COM] The S&P 500 continues to trade near the top-end of today's range with a 2.0% gain. The Russell 2000 is up 2.6%.
One last look at the sector performances shows consumer discretionary (+4.4%) and information technology (+4.0%) on top with about 4% gains. The energy (-1.2%) and financials (-0.2%) sectors remain the only sectors trading in negative territory, as these two groups take a well-deserved breather amid lower oil prices and bond yields.
WTI crude futures settled lower by 1.6%, or $1.02, to $64.02/bbl.
S&P 500 clipped by continued rotation out of growth stocks
08-Mar-21 16:20 ET
Dow +306.14 at 31802.44, Nasdaq -310.99 at 12609.18, S&P -20.59 at 3821.35
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 decreased 0.5% on Monday, as money continued to flow out of the heavily-weighted growth stocks and into value/cyclical stocks. The former group contributed to the 2.4% decline in Nasdaq Composite (-2.4%), while the latter helped lift the Dow Jones Industrial Average (+1.0%) to an intraday record high. The Russell 2000 gained 0.5%.
Seven of the 11 S&P 500 sectors closed in positive territory, but it was hard to overcome the continued growth-stock weakness within the information technology (-2.5%), communication services (-1.5%), and consumer discretionary (-0.2%) sectors. The health care sector (-0.3%) was clipped by its biotechnology components.
The Vanguard Mega Cap Growth ETF (MGK 195.08, -4.45, -2.3) fell 2.3%. The Philadelphia Semiconductor Index fell 5.4%. The iShares Nasdaq Biotechnology ETF (IBB 147.23, -2.92, -1.9%) fell 1.9%. Shares of Tesla (TSLA 563.00, -34.95, -5.8%) gave up an early gain and closed sharply lower to extend its recent correction to 37% from its all-time high.
The S&P 500 was up as much as 1.0% in the afternoon on the back of a pro-cyclical trade that drew support from the Senate passing the $1.9 trillion stimulus bill and news that COVID-19 vaccine shots are running at more than two million per day. The stimulus bill will head back to the House, where it's expected to pass later this week.
The financials (+1.3%), materials (+1.3%), and industrials (+1.1%) sectors represented the cyclical leadership, although the utilities sector (+1.4%) advanced the most as the market lost some of its cyclical luster in the second-half of the session. The S&P 500 slipped below its 50-day moving average (3825) on a closing basis.
Separately, another uptick in long-term interest rates, which have risen sharply this year in part due to growth optimism and inflation angst, was attributed by some as a lingering headwind for the growth stocks.
The 10-yr yield increased four basis points to 1.60%, although interestingly, widely-followed money manager David Tepper told CNBC that the 10-yr yield is likely at, or near, the top of a new range due to the higher yields attracting foreign buyers. Mr. Tepper also said stocks like Amazon (AMZN 2951.95, -48.51, -1.6%) look attractive.
The 2-yr yield was unchanged at 0.15%. The U.S. Dollar Index advanced 0.5% to 92.42. WTI crude futures declined 1.6%, or $1.05, to $65.04/bbl.
Monday's economic data was limited to Wholesale Inventories for January, which increased 1.3% m/m (Briefing.com consensus +1.3%) following a revised 0.6% increase in December (from 0.3%). Investors will not receive any notable economic data on Tuesday.
Russell 2000 +11.6% YTD
Dow Jones Industrial Average +3.9% YTD
S&P 500 +1.7% YTD
Nasdaq Composite -2.2% YTD
Market Snapshot
Dow 31802.44 +306.14 (0.97%)
Nasdaq 12609.18 -310.99 (-2.41%)
SP 500 3821.35 -20.59 (-0.54%)
10-yr Note -2/32 1.587
NYSE Adv 1925 Dec 1251 Vol 1.2 bln
Nasdaq Adv 1954 Dec 1950 Vol 5.9 bln
Industry Watch
Strong: Industrials, Financials, Materials, Utilities
Weak: Information Technology, Communication Services, Consumer Discretionary, Health Care
Moving the Market
-- S&P 500 slips lower amid continued weakness in the technology/growth stocks
-- Cyclical/value stocks outperformed amid rotational interest; helped lift Dow to record intraday high
-- 10-yr yield settled at 1.60%
Fed Chair Powell plays spoiler, stocks fall
04-Mar-21 16:20 ET
Dow -345.95 at 30924.14, Nasdaq -274.28 at 12723.49, S&P -51.25 at 3768.47
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 fell 1.3% on Thursday, although it was down as much as 2.5%, as long-term interest rates resumed their recent rise following some comments from Fed Chair Powell. The Nasdaq Composite (-2.1%) and Russell 2000 (-2.8%) dropped more than 2.0%, while the Dow Jones Industrial Average declined 1.1%.
In a conference hosted by The Wall Street Journal, the Fed Chair acknowledged that the recent upward adjustment in real rates caught his attention but affirmed that the current policy stance was appropriate. In other words, the Fed will not use its tools right now to intervene in the Treasury market, which has been pricing in inflation through higher Treasury yields on the back end of the curve.
The 10-yr yield, which was little changed prior to these comments, spiked and settled higher by eight basis points to 1.55%. Mr. Powell added that he would be concerned by a consistent tightening in financials conditions that threatens the achievement of the Fed's employment and inflation goals.
While Fed Chair Powell wasn't yet concerned, today's quick move in rates spoiled an early rebound bid in the broad market, taking nearly every S&P 500 sector into the red, each of the major indices below their 50-day moving averages, and the Nasdaq into correction territory (a decline of 10.0% or greater from a recent high).
The information technology (-2.3%), materials (-2.1%), and consumer discretionary (-2.0%) sectors declined at least 2.0%. The energy sector (+2.5%), however, was on its own path today, closing higher by 2.5%. The final standings improved in the last two hours of trading as yields stabilized.
Energy stocks followed oil prices ($63.83/bbl, +2.52, +4.1%) higher after OPEC+ agreed to maintain current production levels through next month, with the exceptions of Russia and Kazakhstan due to continued seasonal consumption patterns.
The communication services sector (+0.03%) also eked out a positive close amid support from its largest components. Separately, Snowflake (SNOW 249.00, +1.97, +0.8%) and Kroger (KR 34.09, +0.84, +2.5%) finished higher following their earnings reports.
The 2-yr yield was unchanged at 0.14%. The U.S. Dollar Index advanced 0.7% to 91.62. The CBOE Volatility Index increased 7.1% to 28.57.
Reviewing Thursday's economic data:
Initial jobless claims for the week ending February 27 were up 9,000 to 745,000 (Briefing.com consensus 725,000). Continuing claims for the week ending February 20 were down 124,000 to 4.295 million.
The key takeaway from the report is that it is still stunning how high initial jobless claims are. In the same week a year ago, they were 217,000.
Q4 Productivity decreased from the previous quarter at an annual rate of 4.2% (Briefing.com consensus -4.8%) from the preliminary estimate of -4.8%, according to the revised estimate. Unit labor costs jumped at an annual rate of 6.0% (Briefing.com consensus 6.8%) versus the previously published annual rate of 6.8%.
The key takeaway from the report is the indication that nonfarm business sector productivity grew 2.5% in 2020, marking the largest annual increase since 2010, as output declined 4.2% (largest on record going back to 1947) and hours worked fell 6.5% (largest decline since 2009).
Factory orders for manufactured goods increased 2.6% m/m in January (Briefing.com consensus 2.0%) after increasing an upwardly revised 1.6% (from 1.1%) in December. This is the ninth consecutive monthly increase in factory orders.
The key takeaway from the report is that it showed another increase in business spending, as nondefense capital goods excluding aircraft increased 0.4% m/m in January after increasing 1.5% in December. These orders are up 8.3% yr/yr.
Looking ahead, investors will receive the Employment Situation Report for February, the Trade Balance for January, and Consumer Credit for January, on Friday.
Russell 2000 +8.7% YTD
Dow Jones Industrial Average +1.0% YTD
S&P 500 +0.3% YTD
Nasdaq Composite -1.3% YTD
Market Snapshot
Dow 30924.14 -345.95 (-1.11%)
Nasdaq 12723.49 -274.28 (-2.11%)
SP 500 3768.47 -51.25 (-1.34%)
10-yr Note -5/32 1.541
NYSE Adv 719 Dec 2421 Vol 1.5 bln
Nasdaq Adv 597 Dec 3222 Vol 7.7 bln
Industry Watch
Strong: Energy, Communication Services
Weak: Information Technology, Materials, Consumer Discretionary, Industrials
Moving the Market
-- Stocks fall as long-term interest rates resumed rise following Fed Chair Powell's speech
-- Powell said current policy stance was appropriate
-- Energy stocks rallied with oil prices, OPEC+ agreed to not increase production next month
Energy stocks and oil prices rise
04-Mar-21 15:30 ET
Dow -403.14 at 30866.95, Nasdaq -283.33 at 12714.44, S&P -57.45 at 3762.27
[BRIEFING.COM] The S&P 500 is currently down 1.5%, while the Russell 2000 is down 3.1%.
One last look at the S&P 500 sectors shows information technology (-2.3%), materials (-2.3%), and consumer discretionary (-2.2%) down more than 2.0%, while the energy (+1.8%) and communication services (+0.2%) sectors trade in positive territory.
WTI crude futures settled higher by 4.1%, or $2.52, to $63.83/bbl after OPEC+ agreed to leave output levels unchanged in April.
Nasdaq and growth stocks take it on the chin
03-Mar-21 16:20 ET
Dow -121.43 at 31270.09, Nasdaq -361.04 at 12997.77, S&P -50.57 at 3819.72
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 fell 1.3% on Wednesday, as the growth stocks continued to face valuation-oriented and rotational headwinds amid a rise in long-term interest rates. The Nasdaq Composite (-2.7%), which has greater exposure to these names, dropped 2.7%. The Russell 2000 declined 1.1%, and the Dow Jones Industrial Average declined 0.4%.
Long-term interest rates moved higher partly due to lingering growth optimism and pestering inflation concerns. The 10-yr yield rose six basis points to 1.47%, although it settled below its intraday high of 1.50% and well below last week's high of 1.61%. The 2-yr yield increased two basis points to 0.14%. The U.S. Dollar Index increased 0.2% to 90.96.
Growth optimism was linked to new expectations from the Biden administration to have vaccines available for every adult by the end of May, versus prior guidance of July. Inflation concerns stemmed from the February ISM Non-Manufacturing Index showing the Prices Index rise to 71.8% from 64.2% in January.
As it pertained to stocks, the higher rates worked against the growth stocks within the S&P 500 information technology (-2.5%), consumer discretionary (-2.4%), and communication services (-1.6%) sectors. The Philadelphia Semiconductor Index fell 3.1%, the Vanguard Mega Cap Growth ETF (MGK 199.71, -5.32, -2.6%) fell 2.6%, and the ARK Innovation ETF (ARKK 125.11, -8.40, -6.3%) fell 6.3%.
On the flip side, the gains in the cyclical energy (+1.5%), financials (+0.8%), and industrials (+0.1%) were symptomatic of a rotational interest as investors sought areas with direct exposure to the economy. Financial stocks additionally benefited from the curve-steepening activity in the Treasury market; energy stocks followed oil prices ($61.31, +1.52, +2.5%) higher.
Lyft (LYFT 61.76, +4.70, +8.2%) contributed to the so-called reopening thesis after raising its Q1 adjusted EBITDA loss expectation to $135 million from $145-150 million and observing that average daily ride-shares were up 4% m/m in February despite severe weather. LYFT shares rose 8%.
A separate note on inflation, the Fed's Beige Book for February economic activity highlighted that "several districts reported anticipating modest price increases over the next several months." Chicago Fed President Evans (FOMC voter) said he doesn't see inflation as a risk at this point. These observations might have tempered any inflation angst.
For what it's worth, the S&P 500 closed just above its 50-day moving average (3818) despite a weak finish.
Reviewing Wednesday's economic data:
The ISM Non-Manufacturing Index fell to 55.3% in February (Briefing.com consensus 58.6%) from 58.7% in January. The dividing line between expansion and contraction is 50.0%. The February reading marks the ninth straight month of growth for the services sector, but it is the slowest pace since May 2020.
The key takeaway from the report for a market focusing increased attention on inflation trends, as economic activity picks up, is the upward move in the Prices Index to 71.8% from 64.2% in January. This elevated reading follows on the heels of Monday's ISM Manufacturing Index, which showed the Prices Index at its highest level (86.0%) since May 2008.
The ADP Employment Change report estimated 117,000 jobs were added to private-sector payrolls in February (Briefing.com consensus +180,000) following an upwardly revised 195,000 increase (from 174,000) in January.
The IHS Markit Services PMI for February was revised higher to 59.8 from 58.3 in the preliminary reading.
The weekly MBA Mortgage Applications Index increased 0.5% following a 11.4% drop in the prior week.
Looking ahead, investors will receive the weekly Initial and Continuing Claims report, the revised Q4 readings for Productivity and Unit Labor Costs, and Factory Orders for January on Thursday.
Russell 2000 +12.2% YTD
Dow Jones Industrial Average +2.2% YTD
S&P 500 +1.7% YTD
Nasdaq Composite +0.9% YTD
Market Snapshot
Dow 31270.09 -121.43 (-0.39%)
Nasdaq 12997.77 -361.04 (-2.70%)
SP 500 3819.72 -50.57 (-1.31%)
10-yr Note -29/32 1.477
NYSE Adv 1524 Dec 1683 Vol 1.2 bln
Nasdaq Adv 1339 Dec 2598 Vol 5.4 bln
Industry Watch
Strong: Energy, Financials, Industrials
Weak: Information Technology, Health Care, Materials, Utilities
Moving the Market
-- Technology sector continues to weigh, while energy and financial sectors rise
-- Treasury yields moving higher amid lingering growth expectations and inflation angst
-- White House speeds up vaccine timeline by two months
WTI crude futures settle sharply higher
03-Mar-21 15:30 ET
Dow +4.92 at 31396.44, Nasdaq -342.10 at 13016.71, S&P -36.53 at 3833.76
[BRIEFING.COM] The S&P 500 is trading at session lows with a 1.0% decline, while the Russell 2000 clings onto a 0.1% gain.
One last look at the S&P 500 sectors shows information technology (-2.4%), consumer discretionary (-2.0%), and communication services (-1.4%) leading the benchmark index lower amid pronounced weakness in their mega-cap/growth stocks. The energy (+2.3%), financials (+2.4%), and industrials (+0.6%) sectors remain in the green.
WTI crude futures rose 2.5%, or $1.52, to $61.31/bbl.
March begins with a strong rebound rally
01-Mar-21 16:15 ET
Dow +603.14 at 31535.51, Nasdaq +396.48 at 13588.85, S&P +90.67 at 3901.82
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 rallied 2.4% on Monday, as investors indiscriminately bought last week's dip amid a host of positive-sounding developments. The Nasdaq Composite (+3.0%) and Russell 2000 (+3.4%) rose at least 3.0%, while the Dow Jones Industrial Average (+2.0%) followed behind with a 2.0% gain.
All 11 S&P 500 sectors contributed to the steady advance, eight of which advanced more than 2.0%. The information technology (+3.2%) and financials (+3.1%) sectors finished as influential leaders, while the real estate sector (+0.2%) underperformed with a modest gain after a strong start.
From a news perspective, sentiment was boosted after the FDA authorized Johnson & Johnson's (JNJ 159.32, +0.86, +0.5%) COVID-19 vaccine for emergency use, the House passed the $1.9 trillion stimulus bill (handing it over to the Senate), manufacturing PMIs for February out of the U.S., Europe, and Japan exceeded expectations, and Warren Buffett reminded investors to "never bet against America" in his annual shareholder letter.
Specifying the U.S. data, the ISM Manufacturing Index for February jumped to 60.8% (Briefing.com consensus 58.8%) from 58.7% in January, matching the August 2018 reading as the highest since May 2004. It's also worth noting that February was the ninth straight month of expansionary activity (above 50.0%).
Other supporting factors included a calmer Treasury market, first-of-the-month inflows, and a fear of missing on further gains. The latter was likely exacerbated by the recognition that the S&P 500 bounced so strongly off its 50-day moving average (3813) after closing just above it last Friday, which ended on a disappointing note.
In corporate news, United Airlines (UAL 53.31, +0.63, +1.2%) reportedly ordered 25 additional 737 MAX planes from Boeing (BA 224.39, +12.38, +5.8%), Exxon Mobil (XOM 56.40, +2.03, +3.7%) named two new board members, and Royal Caribbean (RCL 91.31, -1.96, -2.1%) priced a common stock offering at $91 per share.
The 2-yr yield decreased two basis points to 0.12%, and the 10-yr yield decreased one basis point to 1.45%. The U.S. Dollar Index increased 0.2% to 91.04. WTI crude futures decreased 1.5%, or $0.91, to $60.54/bbl ahead of an OPEC+ meeting later this week.
Reviewing Monday's economic data:
The ISM Manufacturing Index for February jumped to 60.8% (Briefing.com consensus 58.8%) from 58.7% in January, matching the August 2018 reading as the highest since May 2004. The dividing line between expansion and contraction is 50.0%. February marked the ninth straight month the ISM Manufacturing Index has been above 50.0%.
The key takeaway from the report is the recognition that all 18 industries reported paying higher prices for raw materials in February. That contributed to the Prices Index hitting its highest level since May 2008 and should continue to fuel concerns about potential pass-through pressures to end users.
Total construction spending increased 1.7% m/m in January (Briefing.com consensus 0.6%) after increasing an upwardly revised 1.1% (from 1.0%) in December. Total private construction spending rose 1.7% m/m and total public construction spending increased 1.7%.
The key takeaway from the report is that the strength was driven by gains in both private and public construction spending.
The February IHS Markit Manufacturing PMI increased to 58.6 from 58.5 in January.
Looking ahead to Tuesday, investors will receive the ISM Non-Manufacturing Index for February, the ADP Employment Change report for February, the final IHS Markit Services PMI for February, the Fed's Beige Book for March, and the weekly MBA Mortgage Applications Index.
Russell 2000 +15.2% YTD
Nasdaq Composite +5.4% YTD
S&P 500 +3.9% YTD
Dow Jones Industrial Average +3.0% YTD
Market Snapshot
Dow 31535.51 +603.14 (1.95%)
Nasdaq 13588.85 +396.48 (3.01%)
SP 500 3901.82 +90.67 (2.38%)
10-yr Note -2/32 1.433
NYSE Adv 2568 Dec 654 Vol 1.1 bln
Nasdaq Adv 3187 Dec 784 Vol 5.0 bln
Industry Watch
Strong: Information Technology, Financials, Energy, Industrials
Weak: Real Estate, Consumer Staples
Moving the Market
-- March begins with a broad-based rebound rally
-- Encouraging vaccine, stimulus, economic news
-- Treasury market calmed down
-- Technical and sentiment factors
Rising Treasury yields fuel market weakness
25-Feb-21 16:20 ET
Dow -559.85 at 31402.01, Nasdaq -478.54 at 13119.46, S&P -96.09 at 3829.34
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 dropped 2.5% on Thursday, as another steep rise in Treasury yields undercut risk sentiment and contributed to valuation-oriented weakness in the mega-cap/growth stocks. The Nasdaq Composite fell 3.5%, the Russell 2000 fell 3.7%, and the Dow Jones Industrial Average fell 1.8%.
Specifically, the yield on the 10-yr Treasury note climbed 13 basis points to 1.52%, which was above the S&P 500's dividend yield of 1.51% and 43 basis points higher than where it started the month. This rate of change didn't sit well with the market, even though it was expectations for economic growth and inflation that contributed to the higher yields.
What's more, the 10-yr yield briefly spiked to 1.61% following an ugly 7-yr note auction at 1:00 p.m. ET that saw weak demand. The 2-yr yield increased four basis points to 0.17%. The U.S. Dollar Index increased 0.1% to 90.25.
As for the price action in equities, the retreat was orderly throughout the day with growth stocks taking the brunt of the damage.
The S&P 500 consumer discretionary (-3.6%) and information technology (-3.5%) sectors dropped at least 3.5% amid weakness in their mega-cap components, the Philadelphia Semiconductor Index dropped 5.8%, and the ARK Innovation ETF (ARKK 129.51, -8.81) dropped 6.4%. Out of the 11 S&P 500 sectors, the utilities sector (-1.0%) declined the least.
NVIDIA (NVDA 532.30, -47.66, -8.2%) was an influential laggard with an 8% decline despite beating top and bottom-line estimates and issuing upbeat Q1 revenue guidance.
On the upside, shares of Twitter (TWTR 74.59, +2.67, +3.7%) closed higher after the company said it's aiming to double total annual revenue to $7.5 billion in 2023. Shares of GameStop (GME 108.73, +17.02, +18.6%) had doubled for the second straight day before closing with a more modest gain.
Interestingly, the S&P 500 closed above its 50-day moving average (3805) after coming within ten points of the key technical level at its intraday low (3814). Investors continued to brace for further downside, though, evident by the 35% spike in the CBOE Volatility Index (28.89, +7.55, +35.4%).
WTI crude futures ($63.47/bbl, +0.25, +0.4%) settled in positive territory.
Reviewing Thursday's economic data:
Initial claims for the week ending February 20 decreased by 111,000 to 730,000 (Briefing.com consensus 820,000). Continuing claims for the week ending February 13 decreased by 101,000 to 4.419 million.
The key takeaway from the report is that this is the lowest level of weekly initial claims since early November, which should lend some confidence to the notion that economic activity is picking up again following a late fourth quarter stupor.
Durable Goods Orders for January surged 3.4% m/m (Briefing.com consensus 1.2%) following an upwardly revised 1.2% increase (from 0.2%) in December. Excluding transportation, durable goods orders rose 1.4% (Briefing.com consensus 0.6%) following an upwardly revised 1.7% increase (from 0.7%) in December.
The key takeaway from the report is that it showed an ongoing pickup in business spending, evidenced by a 0.5% m/m increase in nondefense capital goods orders excluding aircraft. These orders -- a proxy for business spending -- are now up 8.3% yr/yr.
The second estimate for Q4 GDP was revised to 4.1%, as expected, from 4.0%. The GDP Price Deflator was bumped up to 2.1% (Briefing.com consensus 2.0%) from 2.0%.
The key takeaway from the report is that it won't be a market mover because (a) it was largely in line with expectations (b) it didn't change much at all from the first estimate and (c) it is dated information, having been released nearly two-thirds of the way through the first quarter.
Pending home sales decreased 2.8% m/m in January following an upwardly revised 0.5% increase in December (from -0.3%).
Looking ahead to Friday, investors will receive Personal Income and Spending for January, PCE Prices for January, the final University of Michigan Index of Consumer Sentiment for February, and Adv. Intl. Trade in Goods, Retail Inventories, and Wholesale Inventories for January.
Russell 2000 +11.4% YTD
Nasdaq Composite +1.8% YTD
S&P 500 +2.0% YTD
Dow Jones Industrial Average +2.6% YTD
Market Snapshot
Dow 31402.01 -559.85 (-1.75%)
Nasdaq 13119.46 -478.54 (-3.52%)
SP 500 3829.34 -96.09 (-2.45%)
10-yr Note -14/32 1.529
NYSE Adv 436 Dec 2764 Vol 1.2 bln
Nasdaq Adv 528 Dec 3339 Vol 6.3 bln
Industry Watch
Strong: Utilities, Health Care
Weak: Information Technology, Consumer Discretionary, Communication Services, Materials
Moving the Market
-- Weak session amid another steep rise in Treasury yields
-- 10-yr yield briefly touched 1.61% before closing at 1.52%
-- Equity decline was broad-based and orderly
WTI crude futures settle higher despite market weakness
25-Feb-21 15:30 ET
Dow -557.31 at 31404.55, Nasdaq -458.94 at 13139.06, S&P -94.55 at 3830.88
[BRIEFING.COM] The S&P 500 is trading at session lows with a 2.4% decline. The retreat has been orderly, reflecting a lack of buying interest.
One last look at the S&P sectors shows steep losses across the board. The information technology
Dow closes at record high in strong session
24-Feb-21 16:15 ET
Dow +424.51 at 31961.86, Nasdaq +132.77 at 13598.00, S&P +44.06 at 3925.43
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 advanced 1.1% on Wednesday in a strong session, as the market remained influenced by reopening optimism, a buy-the-dip mindset, and Fed Chair Powell. The Russell 2000 gained 2.3%, the Dow Jones Industrial Average gained 1.4% for a record close, and the Nasdaq Composite gained 1.1%.
The large-cap indices started the session slightly lower amid relative weakness in the mega-cap and growth stocks, as the 10-yr Treasury note yield touched 1.43% on persistent expectations for economic growth and inflation. The S&P 500 information technology sector (+1.5%) and Philadelphia Semiconductor Index (+3.2%) were both down 1.5% in early action, until Fed Chair Powell started speaking around 10:00 a.m. ET.
In his second day of testimony, Fed Chair Powell told the House Financial Services Committee that it could take three or more years for the economy to reach the Fed's inflation goal. In other words, despite the inflation expectations being priced in the Treasury market, the central bank will hold firm on its extremely accommodative monetary policy.
Yields started to come down from session highs, mega-cap and growth stocks came off session lows, and value/cyclical stocks extended their early gains. The energy (+3.6%), financials (+2.0%), and industrials (+1.9%) sectors advanced the most. The utilities (-1.2%) and consumer staples (-0.03%) sectors, on the other hand, closed lower.
Positive developments supporting growth expectations included the FDA acknowledging that Johnson & Johnson's (JNJ 162.59, +2.15, +1.3%) COVID-19 vaccine is safe with no specific concerns identified that would preclude an emergency use authorization, and new home sales increasing 4.3% m/m to a seasonally adjusted annual rate of 923,000 in January (Briefing.com consensus 855,000).
The reopening trade was kind to shares of Boeing (BA 229.34, +17.22, +8.1%), which rose 8%. Shares of GameStop (GME 91.71, +46.74, +103.9%), meanwhile, doubled late in the day without disrupting the market flow this time around.
The 10-yr yield finished three basis points higher at 1.39%, and the 2-yr yield finished three basis points higher at 0.13%. The U.S. Dollar Index decreased 0.1% to 90.07. WTI crude futures increased another 2.5%, or $1.56, to $63.24/bbl.
Reviewing Wednesday's economic data:
New home sales increased 4.3% m/m to a seasonally adjusted annual rate of 923,000 in January (Briefing.com consensus 855,000) from an upwardly revised 885,000 (from 842,000) in December. On a yr/yr basis, new home sales were up 19.3%.
The key takeaway from the report is that new home sales, which are counted when contracts are signed, ramped up again as demand remained strong in the face of higher prices. Separately, the South remains a hot spot for relocation, evidenced by a 40.4% yr/yr increase in new home sales.
The weekly MBA Mortgage Applications Index dropped 11.4% following a 5.1% decline in the prior week.
Looking ahead, investors will receive the weekly Initial and Continuing Claims report, Durable Goods Orders for January, the second estimate for Q4 GDP, and Pending Home Sales for January on Thursday.
Russell 2000 +15.7% YTD
Nasdaq Composite +5.5% YTD
S&P 500 +4.5% YTD
Dow Jones Industrial Average +4.4% YTD
Market Snapshot
Dow 31961.86 +424.51 (1.35%)
Nasdaq 13598.00 +132.77 (0.99%)
SP 500 3925.43 +44.06 (1.14%)
10-yr Note -3/32 1.385
NYSE Adv 2145 Dec 1067 Vol 1.2 bln
Nasdaq Adv 2823 Dec 1136 Vol 5.6 bln
Industry Watch
Strong: Financials, Energy, Industrials, Materials
Weak: Utilities, Consumer Staples
Moving the Market
-- Cyclical stocks continue to outperform in so-called reflation trade
-- Treasury yields continue to rise amid expectations for economic growth and inflation
-- Fed Chair Powell says it could take another three years for central bank to meet inflation goal
-- Covid-19 vaccine from Johnson & Johnson (JNJ) could soon receive emergency use authorization
WTI crude futures settle above $63 per barrel
24-Feb-21 15:25 ET
Dow +427.15 at 31964.50, Nasdaq +92.16 at 13557.39, S&P +40.09 at 3921.46
[BRIEFING.COM] The S&P 500 continues to trade higher by 1.0%, bringing it into positive territory for the week.
One last look at the S&P 500 sectors shows ten of the 11 sectors trading higher. The energy (+3.5%), industrials (+2.0%), financials (+1.9%), and information technology (+1.2%) sectors lead the advance, while the utilities sector (-0.9%) remains the only sector trading lower.
WTI crude futures settled higher by 2.5%, or $1.56, to $63.24/bbl.
Market closes mixed in resilient session
23-Feb-21 16:10 ET
Dow +15.66 at 31537.35, Nasdaq -67.85 at 13465.23, S&P +4.87 at 3881.37
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 increased 0.1% on Tuesday, overcoming an early 1.8% decline in one of its more resilient sessions of the year. The Dow Jones Industrial Average increased 0.1% after being down 1.2% intraday, while the Nasdaq Composite (-0.5%) and Russell 2000 (-0.9%) decreased modestly after both were down more than 3.5% intraday.
Mega-cap, growth, and technology stocks were influential laggards in early action, presumably due to rate angst, profit taking, and rotational pressure that benefited value/cyclical stocks. Aside from the Nasdaq, these laggards were found primarily in the information technology sector (-0.3%), the consumer discretionary sector (-0.5%), and the Philadelphia Semiconductor Index (-0.6%).
At their lows, the tech sector was down 3.4%, the consumer discretionary sector was down 4.0%, and the chip index was down 4.6%. In addition, the S&P 500 came within ten points of its 50-day moving average (3797). Note, this was right before Fed Chair Powell's prepared remarks for his semiannual congressional testimony were released at around 10:00 a.m. ET.
Mr. Powell didn't say anything particularly new on the economy or monetary policy, reminding lawmakers that the economy is a long way from its employment and inflation goals and that it'll take some time for substantial further progress on those fronts. The market saw this as an affirmation of the Fed's dovish monetary policy for the foreseeable future.
Seemingly on cue, investors started to buy the dip in every sector that was down. The energy (+1.6%), communication services (+1.1%), utilities (+0.8%), and financials (+0.5%) sectors finished with the biggest gains, although declining issues still outnumbered advancing issues at the NYSE and Nasdaq.
At the individual stock level, shares of Home Depot (HD 267.24, -8.61, -3.1%) fell 3% despite its better-than-expected earnings report. Shares of Snap (SNAP 70.45, +7.04, +11.1%) rose 11% after the company noted that its ad platform can drive 50% revenue growth for years to come.
The U.S. Treasury market was a little more stable today, which might have supported risk sentiment. The 2-yr yield decreased one basis point to 0.10%, and the 10-yr yield decreased one basis point to 1.36%. The U.S. Dollar Index increased 0.2% to 90.14. WTI crude futures were little changed at $61.68/bbl.
Reviewing Tuesday's economic data:
The Conference Board's Consumer Confidence Index increased to 91.3 in February (Briefing.com consensus 91.0) from a downwardly revised 88.9 (from 89.3) in January.
The key takeaway from the report is that attitudes about current conditions improved for the first time in four months, aided by some improvement in the view of labor market conditions.
The FHFA Housing Price Index increased 1.1% in February following a 1.0% increase in January.
The S&P Case-Shiller Home Price Index increased 10.1% in December (Briefing.com consensus 9.8%) following an upwardly revised 9.2% reading in November (from +9.1%).
Looking ahead, investors will receive New Home Sales for January and the weekly MBA Mortgage Applications Index on Wednesday.
Russell 2000 +13.0% YTD
Nasdaq Composite +4.5% YTD
S&P 500 +3.3% YTD
Dow Jones Industrial Average +3.0% YTD
Market Snapshot
Dow 31537.35 +15.66 (0.05%)
Nasdaq 13465.23 -67.85 (-0.50%)
SP 500 3881.37 +4.87 (0.13%)
10-yr Note 0/32 1.338
NYSE Adv 1206 Dec 1950 Vol 1.3 bln
Nasdaq Adv 1126 Dec 2787 Vol 7.4 bln
Industry Watch
Strong: Energy, Communication Services, Utilities, Financials
Weak: Information Technology, Consumer Discretionary, Health Care
Moving the Market
-- Market closes mixed in resilient session, growth stocks underperformed
-- Fed Chair Powell reiterates dovish monetary policy stance before the Senate Banking Committee
-- Technical support just above the S&P 500's 50-day moving average (3797)
Market turns positive
23-Feb-21 15:30 ET
Dow +127.97 at 31649.66, Nasdaq -10.62 at 13522.46, S&P +18.09 at 3894.59
[BRIEFING.COM] The S&P 500 has turned positive with a 0.3% gain, which is an impressive feat considering it was down 1.8% to start the day. There's simply no quit in this bull market, equipped with a "buy the dip" and "diamond hands" lexicon.
Nine of the 11 S&P 500 sectors are now contributing to the advance, with the exception being consumer discretionary (-0.2%), which was down 4.0% at its intraday low. The energy sector remains atop the standings with a 1.8% gain.
WTI crude futures finished little changed at $61.68/bbl.
Growth stocks drag market lower amid lingering valuation angst
22-Feb-21 16:15 ET
Dow +27.37 at 31521.69, Nasdaq -341.41 at 13533.08, S&P -30.21 at 3876.50
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 lost 0.8% on Monday for its fifth straight decline, as weakness in the growth stocks outweighed relative strength in the value/cyclical stocks. The Nasdaq Composite dropped 2.5%, and the Russell 2000 declined 0.7%. The Dow Jones Industrial Average (+0.1%), however, eked out a gain.
Valuation angst lingered after the 10-yr yield touched 1.39% in overnight action on the prevailing view that additional fiscal stimulus and reopening/vaccination efforts will spur growth and inflation. Considering the 10-yr yield started the month at 1.09%, this speedy ascent continued to undercut risk sentiment for growth stocks with elevated valuations.
Those were typically found in the Nasdaq, the S&P 500 information technology (-2.3%) and consumer discretionary (-2.2%) sectors, and the Philadelphia Semiconductor Index (-3.8%). Shares of Tesla (TSLA 714.50, -66.80, -8.6%) dropped nearly 9%.
The 10-yr yield finished the session one basis point higher at 1.36%. The 2-yr yield remained flat at 0.11%. The U.S. Dollar Index decreased 0.3% to 90.12.
Interestingly, six of the 11 S&P 500 sectors still closed in positive territory, and the iShares Russell 1000 Value ETF (IWD 145.57, +0.57, +0.4%) closed at a record high. Financial stocks have the biggest weighting in this ETF, and they directly benefited from the minor curve-steepening activity.
The S&P 500 financials sector advanced 1.0%, but the energy sector (+3.5%) noticeably outperformed with a 3.5% gain amid sharply higher oil prices ($61.63, +2.63, +4.5%).
Other cyclical stocks were supported by analyst upgrades. For example, the U.S. Global Jets ETF (JETS 25.68, +0.86, +3.5%) rose 3.5% after Deutsche Bank upgraded many of the airline stocks to Buy from Hold, and Dow Inc. (DOW 62.48, +2.09, +3.5%) provided influential leadership in the materials sector (+0.4%) after BofA Securities upgraded it to Neutral from Underperform.
Boeing (BA 212.88, -4.59, -2.1%) was a notable exception to the reopening trade after a Pratt & Whitney engine in one of its 777 planes caught fire over the weekend. Note, Pratt & Whitney is a subsidiary of Raytheon Technologies (RTX 73.00, -1.26, -1.7%), and no passenger died in the event.
Reviewing Monday's economic data:
The Conference Board's Leading Economic Index (LEI) increased 0.5% m/m in January (Briefing.com consensus 0.4%) following an upwardly revised 0.4% increase (from 0.3%) in December. January marked the ninth consecutive monthly increase.
The key takeaway from the report is that the strength in component indicators was widespread, with seven of the 10 indicators making positive contributions.
Looking ahead, investors will receive the Conference Board's Consumer Confidence Index for February, the FHFA Housing Price Index for February, and the S&P Case-Shiller Home Price Index for December on Tuesday.
Russell 2000 +14.0% YTD
Nasdaq Composite +5.0% YTD
S&P 500 +3.2% YTD
Dow Jones Industrial Average +3.0% YTD
Market Snapshot
Dow 31521.69 +27.37 (0.09%)
Nasdaq 13533.08 -341.41 (-2.46%)
SP 500 3876.50 -30.21 (-0.77%)
10-yr Note 0/32 1.338
NYSE Adv 1510 Dec 1675 Vol 1.2 bln
Nasdaq Adv 1523 Dec 2413 Vol 6.4 bln
Industry Watch
Strong: Energy, Financials, Materials, Industrials, Real Estate
Weak: Information Technology, Consumer Discretionary, Utilities
Moving the Market
-- Growth stocks dragged market lower amid lingering valuation angst, but value/cyclical stocks provided offsetting support
-- 10-yr yield touched 1.39% in overnight action
WTI crude futures rally above $61 per barrel
22-Feb-21 15:25 ET
Dow +97.53 at 31591.85, Nasdaq -283.90 at 13590.59, S&P -20.18 at 3886.53
[BRIEFING.COM] The S&P 500 is trading lower by 0.5% as the prior rebound effort loses steam. The benchmark index is on pace to close lower for the fifth straight session.
One last look at the S&P sectors shows energy (+4.2%) up the most with a 4% gain, followed by more modest gains in the financials (+0.9%), real estate (+0.7%), and industrials (+0.5%) sectors. The information technology (-1.9%), consumer discretionary (-1.7%), and utilities (-2.3%) sectors lag with sharp declines.
WTI crude futures settled higher by 4.5%, or $2.63, to $61.63/bbl.
Growth stocks weigh down S&P 500 amid higher yields
19-Feb-21 16:20 ET
Dow +0.98 at 31494.32, Nasdaq +9.11 at 13874.49, S&P -7.26 at 3906.71
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 declined 0.2% on Friday, as the continued rise in long-term interest rates pressured many of the growth stocks, whose losses overshadowed the strong gains in the cyclical stocks.
The Nasdaq Composite (+0.1%) and Dow Jones Industrial Average (unch) closed little changed, with the Dow setting an all-time high early in the session. The Russell 2000 outperformed with a noteworthy 2.2% gain amid strength in small-cap financial and energy stocks.
Notably, the yield on the 10-yr Treasury note rose another six basis points to 1.35% amid a pro-cyclical news cycle that supported continued selling in longer-dated maturities. To name a few, Treasury Secretary Yellen reiterated the "think big" approach to stimulus, reports suggested that the U.S. will double its vaccine supply in the coming weeks, and earnings/economic data continued to beat expectations.
The S&P 500 materials (+1.9%), energy (+1.6%), industrials (+1.6%), and financials (+1.2%) sectors took the news in stride, with Deere (DE 330.00, +29.75, +9.9%) providing an additional boost for the industrials sector following its positive earnings report. DE shares climbed 10% to fresh all-time highs.
The Philadelphia Semiconductor Index (+2.4%) was another area of strength, as chipmakers rallied around strong quarterly results and guidance from Applied Materials (AMAT 119.46, +6.03, +5.3%).
The market, however, was restrained by influential declines in the information technology (-0.2%), communication services (-1.1%), and consumer discretionary (-0.9%) sectors amid valuation-oriented weakness in their mega-cap growth components. The Vanguard Mega Cap Growth ETF (MGK 211.63, -1.74, -0.8%) declined 0.8%.
The utilities (-1.5%), consumer staples (-1.2%), and health care (-1.2%) sectors also dragged on performance.
The 2-yr yield increased one basis point to 0.11%. The U.S. Dollar Index decreased 0.2% to 90.37. WTI crude futures pulled back 2.1%, or $1.27, to $59.15/bbl.
Reviewing Friday's economic data:
Existing home sales increased 0.6% m/m in January to a seasonally adjusted annual rate of 6.69 million (Briefing.com consensus 6.56 million) from a downwardly revised 6.65 million (from 6.76 million) in December. Total sales in January were up 23.7% from a year ago.
The key takeaway from the report is that the supply of existing homes for sale is at an all-time low. That is going to be a pressure point that feeds higher prices, limits total sales potential, and creates affordability pressures that will increase with rising mortgage rates.
The IHS flash Markit Manufacturing PMI checked in at 58.5 vs. 59.2 in December; the flash Services PMI checked in at 58.9 vs. 58.3 in December.
Looking ahead, investors will receive the Conference Board's Leading Economic Index (LEI) for January on Monday.
Russell 2000 +14.8% YTD
Nasdaq Composite +7.7% YTD
S&P 500 +4.0% YTD
Dow Jones Industrial Average +2.9% YTD
Market Snapshot
Dow 31494.32 +0.98 (0.00%)
Nasdaq 13874.49 +9.11 (0.07%)
SP 500 3906.71 -7.26 (-0.19%)
10-yr Note -4/32 1.313
NYSE Adv 2118 Dec 1054 Vol 1.1 bln
Nasdaq Adv 2705 Dec 1249 Vol 6.6 bln
Industry Watch
Strong: Industrials, Financials, Energy, Materials
Weak: Utilities, Health Care, Consumer Staples, Communication Services, Consumer Discretionary
Moving the Market
-- Cyclical sectors support market amid growth optimism, but rise in long-term interest rates pressure growth stocks
-- 10-yr yield closes at 1.34%
-- Russell 2000 outperformed, Dow set all-time high
Energy stocks rise despite pullback in oil prices
19-Feb-21 15:25 ET
Dow +58.19 at 31551.53, Nasdaq +21.95 at 13887.33, S&P -0.87 at 3913.10
[BRIEFING.COM] The S&P 500 is trading back at its flat line, while the Dow (+0.2%) remains on pace to close at another record high.
One last look at the S&P sectors shows materials (+2.1%), industrials (+1.8%), energy (+1.7%), and financials (+1.3%) supporting the broader market with solid gains, while the health care (-0.9%), communication services (-0.9%), consumer staples (-1.1%), and utilities (-1.5%) trade sharply lower.
WTI crude futures settled lower by 2.1%, or $1.27, to $59.15/bbl.
Stocks close mostly lower but pare losses
18-Feb-21 16:20 ET
Dow -119.68 at 31493.34, Nasdaq -100.14 at 13865.38, S&P -17.36 at 3913.97
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 declined 0.4% on Thursday, although it was down as much as 1.2% in the morning. The Nasdaq Composite (-0.7%) and Dow Jones Industrial Average (-0.4%) also closed well off session lows, while the Russell 2000 (-1.7%) struggled throughout the session.
The weak start was attributed primarily to profit-taking interest despite a downtick in long-term interest rates and the latest weekly jobless claims data supporting the case for additional fiscal stimulus. The 10-yr yield decreased one basis point to 1.29%; weekly initial claims increased by 13,000 to 861,000 (Briefing.com consensus 775,000).
Losses were relatively widespread with nine of the 11 S&P 500 sectors closing lower, but investors did appear to buy the dip in many areas of the market. The information technology sector, for example, declined 0.5% after being down 1.7% intraday, and the consumer discretionary sector (+0.1%) overcame a 1.1% intraday decline.
Exceptions to the buy-the-dip activity were the S&P 500 energy sector (-2.3%), which closed near session lows, and Walmart (WMT 137.66, -9.54, -6.5%), which dropped 6.5% following its mixed earnings report and tepid FY22 EPS guidance.
The utilities sector (+0.6%), to its credit, traded higher for most of the session amid earnings-driven gains in Southern (SO 59.85, +0.58, +1.0%) and FirstEnergy (FE 34.25, +2.30, +7.2%).
Twilio (TWLO 443.49, +31.84, +7.7%) was another earnings standout with an 8% gain that propped the stock to a fresh all-time high.
In other corporate news, GameStop (GME 40.69, -5.25, -11.4%) fell another 11% amid the GME hearing on Capitol Hill, Coca-Cola (KO 50.77, +0.64, +1.3%) increased its quarterly dividend by one cent to $0.42/share, and Wells Fargo (WFC 36.96, +0.37, +1.0%) was upgraded to Neutral from Underweight at JP Morgan amid news that the Fed is getting closer to easing the company's asset restrictions.
The 2-yr yield was unchanged at 0.10%. The U.S. Dollar Index decreased 0.4% to 90.56. WTI crude futures decreased 1.2%, or $0.70, to $60.42/bbl.
Reviewing Thursday's economic data:
Initial jobless claims for the week ending February 13 increased by 13,000 to 861,000 (Briefing.com consensus 775,000). Continuing claims for the week ending February 6 decreased by 64,000 to 4.494 million.
The key takeaway is that the upward thrust in initial jobless claims, which remain at extremely high levels, will continue to fuel calls to go big on the next stimulus package.
Housing starts declined 6.0% m/m in January to a seasonally adjusted annual rate of 1.580 million units (Briefing.com consensus 1.670 million). Building permits increased 10.4% m/m to 1.881 million (Briefing.com consensus 1.670 million).
The key takeaway is that there was a notable decline in single-unit starts (-12.2%) that will fail to provide relief for a tightly-supplied housing market, thereby keeping upward pressure on median home prices.
The Philadelphia Fed Index decreased to 23.1 in February (Briefing.com consensus 15.0) from an unrevised 26.5 in January.
Import prices increased 1.4% in January while import prices excluding oil increased 0.8%. Export prices increased 2.5% in January while export prices excluding agriculture increased 2.2%.
Looking ahead, investors will receive Existing Home Sales for January and the flash IHS Markit Manufacturing and Services PMIs for February on Friday.
Russell 2000 +12.3% YTD
Nasdaq Composite +7.6% YTD
S&P 500 +4.2% YTD
Dow Jones Industrial Average +2.9% YTD
Market Snapshot
Dow 31493.34 -119.68 (-0.38%)
Nasdaq 13865.38 -100.14 (-0.72%)
SP 500 3913.97 -17.36 (-0.44%)
10-yr Note -4/32 1.313
NYSE Adv 1044 Dec 2150 Vol 941.4 mln
Nasdaq Adv 1129 Dec 2812 Vol 6.4 bln
Industry Watch
Strong: Utilities, Consumer Discretionary
Weak: Energy, Communication Services, Materials, Health Care
Moving the Market
-- Stocks close mostly lower but pare early losses
-- Walmart (WMT) declined 6.5% on mixed earnings, tepid FY22 EPS guidance
-- Profit-taking pressure
WTI crude futures give back some gains
18-Feb-21 15:25 ET
Dow -91.11 at 31521.91, Nasdaq -69.81 at 13895.71, S&P -12.42 at 3918.91
[BRIEFING.COM] The S&P 500 is trading lower by 0.3%, which is the comparable to the decline in the Dow (-0.3%).
One last look at the S&P sectors shows energy (-2.1%) trading near session lows with a 2% decline amid a modest retrace in oil prices, while the utilities (+0.7%) and consumer discretionary (+0.3%) sectors trade higher.
WTI crude futures settled lower by 1.2%, or $0.70, to $60.42/bbl. Prior to today, WTI crude futures were up 17% this month.
Flat finish for the S&P 500 in resilient session
17-Feb-21 16:15 ET
Dow +90.27 at 31613.02, Nasdaq -82.00 at 13965.52, S&P -1.26 at 3931.33
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 (-0.03%) finished flat on Wednesday, battling back from an early 0.8% decline after finding support at the 3900 level. The Dow Jones Industrial Average (+0.3%) eked out a closing record high, while the Nasdaq Composite (-0.6%) and Russell 2000 (-0.7%) closed lower amid profit-taking pressure.
Prior to the open, investors received retail sales and producer inflation data for January that easily topped expectations and supported the economic recovery thesis. Specifically, retail sales surged 5.3% m/m (Briefing.com consensus +0.8%), and the Producer Price Index jumped 1.3% m/m (Briefing.com consensus +0.5%) -- the largest increase since the index began in December 2009.
The initial equity reaction was negative, partly because long-term interest rates resumed their quick ascent, which weighed on the valuations of growth stocks, and partly due to a view that the recovery news might have been priced in during the month's rally. The 10-yr yield, which rose ten basis points yesterday, touched 1.33% immediately after the data but finished flat at 1.30%.
The temperance in the Treasury market likely contributed to a buy-the-dip mindset, which carried eight of the 11 S&P 500 sectors into positive territory after each started the session in the red. The energy sector (+1.5%) followed oil prices higher ($61.12/bbl, +1.03, +1.7%), and the consumer discretionary (+0.7%) and communication services (+0.5%) sectors follows behind.
Unsurprisingly, the top-weighted information technology sector (-1.0%) held back the S&P 500 amid relative weakness in its growth-stock components, including the semiconductor stocks. The Philadelphia Semiconductor Index declined 1.9%, trimming its monthly gain to 10.1%.
Shares of Verizon (VZ 56.99, +2.84, +5.2%) and Chevron (CVX 95.92, +2.79, +3.0%) were boosted by news that Berkshire Hathaway (BRK.B 245.21, -0.07, unch) disclosed new positions in the stocks last quarter. Shopify (SHOP 1425.00, -49.00, -3.3%) shares pulled back modestly despite reporting better-than-expected earnings results.
Separately, the Fed-sensitive 2-yr yield decreased two basis points to 0.10%, as the FOMC Minutes from the January meeting corroborated the central bank's dovish monetary policy stance. The U.S. Dollar Index advanced 0.5% to 90.92.
Reviewing Wednesday's economic data:
January retail sales surged 5.3% month-month (Briefing.com consensus +0.8%), aided by the receipt of stimulus checks and pent-up spending activity, and more than neutralized the downward revision for December to -1.0% from -0.7%. Excluding autos, retail sales soared 5.9% month-over-month (Briefing.com consensus +0.7%) and more than neutralized any disappointment that might have been attached to the downward revision for December to -1.8% from -1.4%.
The key takeaway from the report is that sales were up solidly across every retail category, offering an early sign of the added spending -- and economic recovery -- potential that is wrapped up in another round of proposed stimulus checks.
The Producer Price Index for final demand jumped 1.3% month-over-month in January (Briefing.com consensus +0.5%) -- the largest increase since the index began in December 2009 -- while the index for final demand, less foods and energy, rose 1.2% month-over-month (Briefing.com consensus +0.2%).
The key takeaway from this report is that producers clearly incurred higher prices in January; however, last week's Consumer Price Index showed that there wasn't any meaningful pass through to consumers. Nonetheless, there could be some angst about rising consumer prices in coming months given that the index for processed goods for intermediate demand was up 1.7% in January while the index for unprocessed goods for intermediate demand advanced 3.8%.
Industrial production increased 0.9% m/m in January (Briefing.com consensus 0.6%) following a downwardly revised 1.3% increase (from 1.6%) in December. The capacity utilization rate jumped to 75.6% (Briefing.com consensus 74.9%) from an upwardly revised 74.9% (from 74.5%) in December.
The key takeaway from the report is the continued strength in manufacturing output, which occurred despite a decline in the index for motor vehicles and parts attributed to a shortage in semiconductors used in vehicle components.
The NAHB Housing Market Index increased to 84 in February (Briefing.com consensus 86.0) from 83 in January.
Business inventories increased 0.6% in December (Briefing.com consensus 0.5%) following an unrevised 0.5% increase in November.
The weekly MBA Mortgage Applications Index fell 5.1% following a 4.1% decline in the prior week.
Looking ahead, investors will receive Housing Starts and Building Permits for January, the weekly Initial and Continuing Claims report, the Philadelphia Fed Index for February, and Import and Export Prices for January on Thursday.
Russell 2000 +14.2% YTD
Nasdaq Composite +8.4% YTD
S&P 500 +4.7% YTD
Dow Jones Industrial Average +3.3% YTD
Market Snapshot
Dow 31613.02 +90.27 (0.29%)
Nasdaq 13965.52 -82.00 (-0.58%)
SP 500 3931.33 -1.26 (-0.03%)
10-yr Note +2/32 1.296
NYSE Adv 1390 Dec 1791 Vol 967.5 mln
Nasdaq Adv 1561 Dec 2390 Vol 7.1 bln
Industry Watch
Strong: Energy, Consumer Discretionary, Communication Services
Weak: Information Technology
Moving the Market
-- S&P 500 closes flat in resilient session
-- Relative weakness in growth stocks amid brief spike in longer-dated Treasury yields
-- Retail sales and producer prices for January exceed expectations
WTI crude futures settle above $61 per barrel
17-Feb-21 15:30 ET
Dow +101.75 at 31624.50, Nasdaq -92.17 at 13955.35, S&P -2.82 at 3929.77
[BRIEFING.COM] The S&P 500 is down 0.1% after being down 0.8% early in the day. The Dow (+0.3%) is on pace to close at another record high.
One last look at the S&P sectors shows information technology (-1.1%) still weighing on the market with a 1% decline. The energy (+1.1%), consumer discretionary (+0.7%), and communication services (+0.5%) sectors provide solid support.
WTI crude futures settled higher by 1.7%, or $1.03, to $61.12/bbl.
Dow ekes out closing record high, financial and energy stocks outperformed
16-Feb-21 16:15 ET
Dow +64.35 at 31522.75, Nasdaq -47.97 at 14047.52, S&P -2.24 at 3932.59
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The Dow Jones Industrial Average (+0.2%) eked out a closing record high on Tuesday amid strength in financial and energy stocks. The S&P 500 (-0.1%) and Nasdaq Composite (-0.3%) ended with modest losses after setting all-time highs in early action, while the Russell 2000 (-0.7%) underperformed.
Investors remained optimistic on the economy, evident by the continued selling interest in longer-dated Treasuries, which drove yields noticeably higher. The growth-sensitive 10-yr yield rose ten basis points to 1.30%, while the Fed-sensitive 2-yr yield increased two basis points to 0.12%. The U.S. Dollar Index increased 0.1% to 90.54.
This curve-steepening activity was a boon for the bank stocks within the S&P financials sector (+1.8%). The energy sector advanced the most, though, with a 2.3% gain amid higher oil ($60.09/bbl, +0.62, +1.0%) and gas ($3.13/MMBtu, +0.22, +7.2%) prices after a winter storm left millions of people without power in the U.S.
The communication services sector (+0.4%) also outperformed, as investors continued to bid up shares of companies with digital advertising exposure. Conversely, the utilities (-1.1%), real estate (-1.1%), and health care (-1.0%) sectors declined at least 1.0%.
On the earnings front, shares of CVS Health (CVS 70.53, -3.68, -4.0%), Zoetis (ZTS 166.47, -0.24, -0.1%), and Allegion (ALLE 109.81, -8.45, -7.2%) closed lower despite the companies reporting better-than-expected quarterly results.
In other developments, Democratic senators reportedly hope to bring the fiscal stimulus bill up for a floor vote next week, Reuters reported that OPEC+ will likely ease supply curbs after April of this year amid increase in prices, and Conagra (CAG 33.90, -0.65, -1.9%)/Kraft Heinz (KHC 35.36, -0.03, -0.1%) products may become more expensive as a result of higher raw material costs.
The CBOE Volatility Index increased 7.5% to 21.46 amid an uptick in hedging interest.
Tuesday's economic data was limited to the Empire State Manufacturing Survey, which increased to 12.1 in February (Briefing.com consensus 9.0) from 3.5 in January.
Looking ahead to Wednesday, investors will receive Retail Sales for January, the Producer Price Index for January, Industrial Production and Capacity Utilization for January, the FOMC Minutes, the NAHB Housing Index for February, Business Inventories for December, and the weekly MBA Mortgage Applications Index.
Russell 2000 +15.1% YTD
Nasdaq Composite +9.0% YTD
S&P 500 +4.7% YTD
Dow Jones Industrial Average +3.0% YTD
Market Snapshot
Dow 31522.75 +64.35 (0.20%)
Nasdaq 14047.52 -47.97 (-0.34%)
SP 500 3932.59 -2.24 (-0.06%)
10-yr Note -27/32 1.264
NYSE Adv 1503 Dec 1720 Vol 1.0 bln
Nasdaq Adv 2091 Dec 1891 Vol 7.5 bln
Industry Watch
Strong: Energy, Financials, Communication Services
Weak: Utilities, Real Estate, Health Care, Consumer Discretionary
Moving the Market
-- Dow ekes out closing record high in mixed session
-- 10-yr yield rose to 1.30% amid increased selling interest
-- Continued strength in energy and financial stocks
WTI crude futures settle at $60 per barrel
16-Feb-21 15:30 ET
Dow +75.09 at 31533.49, Nasdaq -42.74 at 14052.75, S&P +0.33 at 3935.16
[BRIEFING.COM] The S&P 500 continues to trade near its flat line. The Russell 2000 is down 0.5%.
One last look at the S&P sectors shows energy (+2.5%) and financials (+2.0%) still leading the market higher with gains of at least 2.0%. The real estate (-1.1%), utilities (-1.0%), and health care (-1.0%) sectors are down at least 1.0%.
WTI crude futures settled higher by 1.0%, or $0.62, to $60.09/bbl.
S&P 500, Nasdaq, and Dow close at record highs
12-Feb-21 16:15 ET
Dow +27.70 at 31458.40, Nasdaq +69.70 at 14095.49, S&P +18.45 at 3934.83
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 (+0.5%), Nasdaq Composite (+0.5%), and Dow Jones Industrial Average (+0.1%) closed at record highs on Friday, thanks to a strong finish ahead of a three-day weekend. The Russell 2000 increased 0.2%.
The economic reopening narrative shined throughout the session. Cyclical sectors outperformed, WTI crude futures ($59.47/bbl, +1.24, +2.1%) settled close to $60 per barrel, and the yield on the 10-yr Treasury note rose four basis points to 1.20% amid increased selling interest.
The higher oil prices and Treasury yields contributed to the relative strength in the S&P 500 energy (+1.4%) and financials (+1.0%) sectors, which were joined by the materials (+1.0%), industrials (+0.7%), and health care (+0.8%) sectors atop the standings. The latter benefited from a 12% earnings-driven gain in Illumina (ILMN 504.76, +53.54, +11.9%).
On the downside, the utilities (-0.8%) and real estate (-0.1%) sectors lagged in negative territory. Walt Disney (DIS 187.67, -3.24, -1.7%) weighed on the communication services sector (+0.1%) despite reporting positive earnings results and strong subscriber numbers.
Shares of NVIDIA (NVDA 598.45, -11.58, -1.9%) fell 2% after Bloomberg reported that Alphabet's (GOOG 2104.11, +8.22, +0.4%) Google, Microsoft (MSFT 244.99, +0.50, +0.2%), and Qualcomm (QCOM 147.98, +2.42, +1.7%) want antitrust officials to intervene in NVIDA's deal to purchase Arm Holdings. NVDA was one of the few decliners in the Philadelphia Semiconductor Index (+1.2%).
In other developments, the Senate is reportedly planning to fast-track the stimulus bill past individual committees, meaning it should reach the floor for a vote a bit sooner than previously expected. Separately, Charles Schwab (SCHW 58.19, +2.26, +4.0%) reported a 75% m/m increase in its total number of brokerage accounts.
The 2-yr yield decreased one basis point to 0.10%. The U.S. Dollar Index increased 0.1% to 90.46. The CBOE Volatility Index fell 6.0% to 19.97.
Reviewing Friday's economic data:
The preliminary February reading of the University of Michigan Index of Consumer Sentiment fell to 76.2 (Briefing.com consensus 80.8) from the final reading of 79.0 in January.
The key takeaway from the report is that the February drop was owed to lower expectations among households with incomes below $75,000.
Looking ahead, investors will receive the Empire State Manufacturing Survey for February and Net Long-Term TIC Flows for December when the market reopens on Tuesday. The market will be closed on Monday for Washington's Birthday.
Russell 2000 +15.9% YTD
Nasdaq Composite +9.4% YTD
S&P 500 +4.8% YTD
Dow Jones Industrial Average +2.8% YTD
Market Snapshot
Dow 31458.40 +27.70 (0.09%)
Nasdaq 14095.49 +69.70 (0.50%)
SP 500 3934.83 +18.45 (0.47%)
10-yr Note +2/32 1.139
NYSE Adv 1765 Dec 1421 Vol 831.0 mln
Nasdaq Adv 2197 Dec 1764 Vol 7.3 bln
Industry Watch
Strong: Energy, Financials, Materials, Industrials, Health Care
Weak: Real Estate, Utilities
Moving the Market
-- S&P 500, Nasdaq, and Dow close at record highs in strong finish ahead of three-day weekend
-- Relative strength in cyclical stocks, Treasury yields and oil prices rise
WTI crude futures settle close to $60 per barrel
12-Feb-21 15:30 ET
Dow -40.93 at 31389.77, Nasdaq +11.96 at 14037.75, S&P +5.68 at 3922.06
[BRIEFING.COM] The S&P 500 continues to hover with a 0.1% gain, while the Russell 2000 trades lower by 0.1%.
One last look at the S&P 500 sectors shows energy (+1.0%), financials (+0.7%), industrials (+0.5%), and health care (+0.5%) outperforming, while the utilities (-1.0%), real estate (-0.5%), and consumer discretionary (-0.4%) sectors underperform in the red.
WTI crude futures settled higher by 2.1%, or $1.24, to $59.47/bbl.
Nasdaq closes at record high in range-bound session
11-Feb-21 16:20 ET
Dow -7.10 at 31430.70, Nasdaq +53.24 at 14025.79, S&P +6.50 at 3916.38
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The major indices closed mixed and little changed on Thursday in a range-bound session. The Nasdaq Composite (+0.4%) closed at a record high with a 0.4% gain, the S&P 500 (+0.2%) and Russell 2000 (+0.1%) eked out smaller gains, and the Dow Jones Industrial Average (-0.02%) closed fractionally lower after setting an all-time high early in the day.
The session started modestly higher, as the market remained influenced by a fear of missing out on further gains, positive momentum, and lingering growth optimism. The market then slipped into negative territory amid some profit-taking pressure, but the large-cap indices never went below yesterday's lows.
Red-hot stocks within the energy, small-cap, and micro-cap sectors were hit the hardest on the way down before investors classically bought the dip. For reference, the iShares Micro-Cap ETF (IWC 150.73, -0.63, -0.4%) declined 0.4% after being down 2.0% intraday, and the S&P 500 energy sector declined 1.5% after being down 3.6% intraday. The S&P 500 was down 0.5% at its low.
The top-weighted S&P 500 information technology sector (+1.1%) was a steady support for the market amid strength in payment companies and semiconductor companies. The Philadelphia Semiconductor Index advanced 3.5%.
Tech heavyweight MasterCard (MA 342.87, +8.66, +2.6%) and Bank of New York Mellon (BK 42.13, +0.39, +0.9%) will reportedly incorporate cryptocurrencies into their businesses. Separately, bullish analyst commentary about NAND prices out of Morgan Stanley helped spur the semiconductor gains.
Notably, Tilray (TLRY 32.16, -31.75, -49.7%) and other cannabis stocks did not benefit from a buy-the-dip mindset. The space was hit hard throughout the day in an unwind of the so-called Reddit trade.
In other corporate news, PepsiCo (PEP 134.97, -2.73, -2.0%), Uber (UBER 60.71, -2.47, -3.9%), and Zillow (ZG 200.60, +28.89, +16.8%) traded mixed following their earnings reports. Kraft Heinz (KHC 35.54, +1.65, +4.9%) agreed to sell its nuts business to Hormel Foods (HRL 48.18, -1.65, -3.3%) for $3.35 billion in cash. Bumble (BMBL 70.31, +27.31, +63.5%) had a hot public debut.
U.S. Treasuries finished on a lower note, pushing most yields higher. The 2-yr yield increased one basis point to 0.11%, and the 10-yr yield increased three basis points to 1.16%. The U.S. Dollar Index was little changed at 90.40. WTI crude futures decreased 0.8%, or $0.48, to $58.23/bbl.
Reviewing Thursday's economic data:
Initial claims decreased by 19,000 to 793,000 (Briefing.com consensus 750,000) in the week ending February 6 following an upward revision to 812,000 (from 779,000) for the prior week. Continuing claims for the week ending January 30 decreased by 145,000 to 4.545 million following an upward revision to 4.690 million (from 4.592 million) for the prior week.
The key takeaway from the report is unchanged: the labor market is not in a good place and that will necessitate additional stimulus measures.
Looking ahead, investors will receive the preliminary University of Michigan Index of Consumer Sentiment for February on Friday.
Russell 2000 +15.6% YTD
Nasdaq Composite +8.8% YTD
S&P 500 +4.3% YTD
Dow Jones Industrial Average +2.7% YTD
Market Snapshot
Dow 31430.70 -7.10 (-0.02%)
Nasdaq 14025.79 +53.24 (0.38%)
SP 500 3916.38 +6.50 (0.17%)
10-yr Note +2/32 1.139
NYSE Adv 1477 Dec 1719 Vol 1.0 bln
Nasdaq Adv 1768 Dec 2199 Vol 10.7 bln
Industry Watch
Strong: Information Technology
Weak: Energy, Utilities, Communication Services
Moving the Market
-- Major indices trade mixed and little changed
-- Relative strength in technology stocks
-- Energy stocks and small-caps underperform
WTI crude futures settle lower, energy stocks underperform
11-Feb-21 15:25 ET
Dow -38.58 at 31399.22, Nasdaq +31.15 at 14003.70, S&P +1.65 at 3911.53
[BRIEFING.COM] The S&P 500 is back in the green with a 0.1% gain after being down 0.5% around midday.
One last look at the sector performances shows materials (+0.2%) and health care (+0.1%) joining the information technology sector (+0.9%) in the green. The energy sector remains the weakest link with a 2.0% decline, followed by utilities (-0.7%).
WTI crude futures settled lower by 0.8%, or $0.48, to $58.23/bbl.
New closing highs for Nasdaq and Russell 2000
09-Feb-21 16:15 ET
Dow -9.93 at 31375.83, Nasdaq +20.06 at 14007.71, S&P -4.36 at 3911.23
https://www.briefing.com/stock-market-update
[BRIEFING.COM] Each of the major indices set intraday record highs on Tuesday, but only the Nasdaq Composite (+0.1%) and Russell 2000 (+0.4%) closed at record highs. The S&P 500 (-0.1%) and Dow Jones Industrial Average (-0.03%) snapped their six-session winning streaks with fractional declines.
Today's price action suggested the market was consolidating its February rally in which the S&P 500 rallied more than 5% in the prior six trading sessions. Most sectors flipped between modest gains and losses today, except for the energy sector (-1.5%), which declined 1.5%.
The materials (-0.7%) and consumer discretionary (-0.6%) sectors also underperformed, while the real estate (+0.5%) and communication services (+0.2%) sectors showed relative strength. Broader selling interest was muted, as investors respected the positive macro factors in the market.
To rehash, these factors included increasing COVID-19 vaccination rates and decreasing infection/hospitalization rates, low interest rates, optimism surrounding another fiscal stimulus bill, and better-than-expected earnings reports.
Take-Two Interactive (TTWO 200.31, -13.03, -6.1%) and DuPont (DD 73.48, -2.28, -3.0%) were among the latest companies to exceed earnings expectations and issue upbeat guidance, but the reactions were disappointing. Nucor (NUE 54.68, +0.98, +1.8%) raised Q1 EPS guidance well above consensus estimates due to positive economic trends and robust demand in the steel industry.
Separately, Electronic Arts (EA 146.11, +3.65, +2.6%), a competitor to TTWO, announced plans to acquire Glu Mobile (GLUU 12.67, +3.28, +34.9%) for $12.50/share in a cash deal worth $2.1 billion in enterprise value. The deal was a 36% premium to GLUU's closing price on Feb. 5.
U.S. Treasuries finished little changed in a tight-ranged session. The 2-yr yield increased one basis point to 0.12%, and the 10-yr yield finished flat at 1.16%. The U.S. Dollar Index fell 0.5% to 90.46. WTI crude futures increased 0.7%, or $0.38, to $58.35/bbl.
Reviewing Tuesday's economic data:
Job openings increased to 6.646 million in December from a revised 6.572 million in November (from 6.527 million).
The NFIB Small Business Optimism Index decreased to 95.0 in December from 95.9 in November.
Looking ahead, investors will receive the Consumer Price Index for January, the Treasury Budget for January, Wholesale Inventories for December, and the MBA Mortgage Applications Index on Wednesday.
Russell 2000 +16.4% YTD
Nasdaq Composite +8.7% YTD
S&P 500 +4.1% YTD
Dow Jones Industrial Average +2.5% YTD
Market Snapshot
Dow 31375.83 -9.93 (-0.03%)
Nasdaq 14007.71 +20.06 (0.14%)
SP 500 3911.23 -4.36 (-0.11%)
10-yr Note +1/32 1.154
NYSE Adv 1854 Dec 1342 Vol 892.0 mln
Nasdaq Adv 2300 Dec 1625 Vol 8.6 bln
Industry Watch
Strong: Real Estate, Communication Services, Industrials
Weak: Energy, Materials, Consumer Discretionary
Moving the Market
-- Major indices set intraday all-time highs, Nasdaq and Russell 2000 close at new highs
-- Consolidation activity
-- Respecting the positive trend
WTI crude futures settle higher, but energy stocks cool down
09-Feb-21 15:25 ET
Dow +12.95 at 31398.71, Nasdaq +29.90 at 14017.55, S&P -0.89 at 3914.70
[BRIEFING.COM] The S&P 500 is trading flat, while the Russell 2000 is up 0.5% and well on its way to close at another record high.
One last look at the S&P sectors shows energy down 1.4% and materials down 0.5%. On the positive side, the communication services (+0.5%) and real estate (+0.3%) sectors outperform with modest gains.
WTI crude futures settled higher by 0.7%, or $0.38, to $58.35/bbl.
Four record closes to start the week
08-Feb-21 16:15 ET
Dow +237.52 at 31385.76, Nasdaq +131.35 at 13987.65, S&P +28.76 at 3915.59
https://www.briefing.com/stock-market-update
[BRIEFING.COM] Each of the major indices set intraday and closing record highs on Monday, with the S&P 500 advancing 0.7% for its sixth straight gain and surpassing the 3900 level for the first time. The Nasdaq Composite (+1.0%) and Dow Jones Industrial Average (+0.8%) performed slightly better, while the Russell 2000 (+2.5%) pulled ahead with a 2.5% gain.
The positive bias started in the futures market after Treasury Secretary Yellen said on Sunday that the economy can reach full employment in 2022 if a stimulus bill is passed, which is two years sooner than the projection issued from the Congressional Budget Office last week.
This observation fueled the so-called recovery trade in which value, cyclical, and small-cap stocks outperform due to expectations for improved economic, and earnings, growth. The S&P 500 energy sector (+4.2%) rallied another 4%, further aided by higher oil prices ($57.97/bbl, +1.08, +1.9%) and Exxon Mobil (XOM 52.09, +2.14, +4.3%) receiving an upgrade to Neutral from Underperform at Exane BNP Paribas.
The financials (+1.2%), information technology (+1.0%), and industrials (+0.9%) sectors follows suit with gains of about 1%, while the utilities sector (-0.8%) was the only group that closed in negative territory.
Tesla (TSLA 863.42, +11.19, +1.3%) provided key support for the consumer discretionary sector (+0.4%) after disclosing a $1.5 billion investment in bitcoin with plans to accept the cryptocurrency as a payment option, subject to applicable laws.
The price of bitcoin spiked more than 15% to fresh all-time highs following the news, and stocks with bitcoin exposure like NVIDIA (NVDA 577.55, +33.91, +6.2%), PayPal (PYPL 282.17, +12.73, +4.7%), and MicroStrategy (MSTR 1041.00, +235.00, +29.2%) posted noticeable gains. NVIDIA also benefited from an appreciation that the chip industry is overwhelmed with strong demand.
U.S. Treasuries finished mixed after investors bought the early weakness in longer-dated maturities. The 2-yr yield increased two basis points to 0.11%, while the 10-yr yield decreased one basis point to 1.16% after touching 1.20% at its intraday high. The U.S. Dollar Index decreased 0.1% to 90.96.
Investors did not receive any economic data on Monday. Looking ahead, investors will receive the NFIB Small Business Optimism Survey for January and the JOLTS - Job Openings report for December on Tuesday.
Russell 2000 +16.0% YTD
Nasdaq Composite +8.5% YTD
S&P 500 +4.3% YTD
Dow Jones Industrial Average +2.6% YTD
Market Snapshot
Dow 31385.76 +237.52 (0.76%)
Nasdaq 13987.65 +131.35 (0.95%)
SP 500 3915.59 +28.76 (0.74%)
10-yr Note 0/32 1.168
NYSE Adv 2311 Dec 875 Vol 970.5 mln
Nasdaq Adv 3048 Dec 901 Vol 8.3 bln
Industry Watch
Strong: Energy, Financials, Information Technology, Industrials
Weak: Utilities, Real Estate, Health Care
Moving the Market
-- Record-setting session for all four major indices
-- Growth optimism, positive momentum
-- Treasury Secretary Yellen said economy can reach full employment in 2022 if stimulus bill is passed
Energy stocks rise with oil prices
08-Feb-21 15:30 ET
Dow +164.67 at 31312.91, Nasdaq +84.19 at 13940.49, S&P +17.84 at 3904.67
[BRIEFING.COM] The S&P 500 is trading higher by 0.5% and on track to close above the 3900 for the first time ever.
One last look at the S&P sectors shows energy (+4.4%) way out in the lead with a 4% gain as it extends its strong start to the year. The financials sector (+0.9%) is next in line with a 0.9% gain, while the utilities (-0.8%) and health care (-0.1%) sectors trade lower.
WTI crude futures settled the session higher by 1.9%, or $1.08, to $57.97/bbl.
A trio of record closes to end the strong week
05-Feb-21 16:15 ET
Dow +92.38 at 31148.24, Nasdaq +78.55 at 13856.30, S&P +15.09 at 3886.83
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 (+0.4%), Nasdaq Composite (+0.6%), and Russell 2000 (+1.4%) set intraday and closing record highs on Friday to cap off an impressive week for the stock market. The Dow Jones Industrial Average (+0.3%) underperformed with a 0.3% gain.
Prior to the open, investors received the January employment report, which was underwhelming but painted the case in Washington for more fiscal stimulus. Briefly, nonfarm payrolls increased by 49,000 (Briefing.com consensus 50,000) following a 227,000 decline in December, and the unemployment rate improved to 6.3% (Briefing.com consensus 6.7%) from 6.7% in December.
Right out of the gate, the cyclical sectors and small-cap stocks assumed the early leadership, partly due to stimulus-induced growth optimism and positive momentum, but the gains were relatively broad-based. The S&P 500 materials (+1.7%), communication services (+1.0%), and energy (+0.9%) sectors finished atop the leaderboard.
The information technology (-0.2%) restrained the broader advance and was the only sector that closed lower today.
Earnings reports for the fourth quarter continued to exceed expectations, with shares of Snap (SNAP 63.64, +5.33, +9.1%), Activision Blizzard (ATVI 101.61, +8.93, +9.6%), and Estee Lauder (EL 272.81, +19.76, +7.8%) reacting positively to the good news. T-Mobile US (TMUS 125.28, -5.32, -4.1%) and Peloton (PTON 148.30, -9.23, -5.9%) closed lower following their reports.
Separately, the House passed a budget resolution that unlocks a budget reconciliation process for the next stimulus package. The stimulus bill would only need a simple majority to pass, and lawmakers will reportedly spend the next few weeks drafting its contents.
The U.S. Treasury yield curve continued to steepen, caused by selling pressure in longer-dated maturities and demand for shorter-dated ones. The 10-yr yield increased three basis points to 1.17%, while the 2-yr yield decreased two basis points to 0.09%. The U.S. Dollar Index fell 0.6% to 90.99. WTI crude futures increased 1.2%, or $0.69, to $56.89/bbl.
Reviewing Friday's economic data:
January nonfarm payrolls increased by 49,000 (Briefing.com consensus 50,000). January private sector payrolls increased by 6,000 (Briefing.com consensus 60,000). January unemployment rate was 6.3% (Briefing.com consensus 6.7%), versus 6.7% in December. The average workweek in January was 35.0 hours (Briefing.com consensus 34.7), versus 34.7 hours in December.
The key takeaway from the report is that it will paint the case in Washington for more stimulus.
The December Trade Balance Report showed a narrowing in the trade deficit to -$66.6 billion (Briefing.com consensus -$65.7 billion) from a downwardly revised -$69.0 billion (from -$68.1 billion) in November.
The key takeaway from the report is found in the annual summary for 2020, which indicates the goods and services deficit widened to $678.7 billion from $576.9 billion in 2019. Exports of goods decreased by $217.7 billion while imports decreased by $166.2 billion, underscoring the global demand drop-off amid the pandemic.
Consumer credit increased by $9.7 bln in December after increasing a downwardly revised $13.9 bln (from $15.3 bln) in November.
The key takeaway from the report is that revolving credit decreased for the ninth time over the last ten months dating back to February, which preceded the initial pandemic lockdown period taking hold in the U.S.
Investors will not receive any notable economic data on Monday.
Russell 2000 +13.1% YTD
Nasdaq Composite +7.5% YTD
S&P 500 +3.5% YTD
Dow Jones Industrial Average +1.8% YTD
Market Snapshot
Dow 31148.24 +92.38 (0.30%)
Nasdaq 13856.30 +78.55 (0.57%)
SP 500 3886.83 +15.09 (0.39%)
10-yr Note -2/32 1.171
NYSE Adv 2126 Dec 1059 Vol 938.0 mln
Nasdaq Adv 2559 Dec 1321 Vol 6.6 bln
Industry Watch
Strong: Energy, Materials, Communication Services, Communication Services, Consumer Staples
Weak: Information Technology
Moving the Market
-- S&P 500, Nasdaq, and Russell 2000 set intraday and closing record highs
-- Lackluster January employment report fed into the view for more fiscal stimulus
-- Positive momentum
WTI crude futures extend weekly gains
05-Feb-21 15:30 ET
Dow +88.68 at 31144.54, Nasdaq +66.94 at 13844.69, S&P +14.88 at 3886.62
[BRIEFING.COM] The S&P 500 is trading higher by 0.4% and is on track to close at a fresh record high.
One last look at the sector performances shows materials (+1.8%) outperforming after it was the only sector that closed lower yesterday. The information technology sector (-0.3%) finds itself as the today's lone sector holdout.
WTI crude futures settled higher by 1.2%, or $0.69, to $56.89/bbl. Crude futures rose 9.0% this week.
S&P 500, Nasdaq, and Russell 2000 close at record highs
04-Feb-21 16:15 ET
Dow +332.26 at 31055.86, Nasdaq +167.20 at 13777.75, S&P +41.57 at 3871.74
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 rose 1.1% on Thursday to extend its win streak to four sessions and close at a record high. The Nasdaq Composite (+1.2%) and Dow Jones Industrial Average (+1.1%) kept pace with the benchmark index, while the Russell 2000 (+2.0%) pulled ahead with a 2% gain. The Nasdaq and Russell 2000 also closed at record highs.
Ten of the 11 S&P 500 sectors finished in positive territory, including the financials sector (+2.3%) atop the standings in a continuation of its strong performance this week. Bank stocks benefited from another uptick in longer-dated Treasury yields. On a related note, the Bank of England warned UK banks to prepare for the possibility of negative interest rates.
Apple (AAPL 137.39, +3.45, +2.6%) was a key market-mover today amid reports that it's nearing a deal with Hyundai-Kia to manufacture the "Apple Car," an autonomous electric vehicle. With additional support from earnings-driven gains in PayPal (PYPL 270.43, +18.53, +7.4%) and eBay (EBAY 61.12, +3.08, +5.3%), the information technology sector gained 1.6%.
On the downside, the materials sector (-0.5%) was the lone sector holdout amid lower metal prices and weakness in Air Products (APD 256.70, -19.90, -7.2%) despite its positive earnings report.
Other laggards included Qualcomm (QCOM 147.97, -14.33, -8.8%), Merck (MRK 76.03, -1.29, -1.7%), UnitedHealth (UNH 329.32, -8.57, -2.5%), and GameStop (GME 53.50, -38.91, -42.1%). Note, the continued weakness in GameStop was cited as a positive factor for sentiment since it appeared to represent the capitulation of last week's short-squeeze mania.
Qualcomm delivered better-than-expected earnings results but warned that supply constraints are preventing it from fully meeting the robust chip demand. Merck and UnitedHealth said their CEOs will retire later this year; Merck also missed top and bottom-line estimates but issued upbeat FY21 guidance.
Evidently, the negative reactions today didn't necessarily follow bad news, which likely bolstered confidence in the broader rally effort.
In the Treasury market, the benchmark 10-yr yield increased one basis point to 1.14% after touching 1.16% at its high. The 2-yr yield was unchanged at 0.11%. The U.S. Dollar Index advanced 0.4% to 91.51. WTI crude futures increased 0.9%, or $0.52, to $55.70/bbl.
Reviewing Thursday's economic data:
Initial jobless claims for the week ending January 30 declined by 33,000 from the prior week to 779,000 (Briefing.com consensus 825,000). Continuing claims for the week ending January 23 decreased by 193,000 to 4.592 million.
The key takeaway from the report is that the level of initial claims improved; however, they didn't improve nearly enough to drown out calls highlighting the need for additional stimulus and extended jobless benefits.
Productivity in the fourth quarter decreased from the previous quarter at an annual rate of 4.8% (Briefing.com consensus -2.8%). Third quarter productivity was revised up to a 5.1% increase from 4.6%. Unit labor costs jumped at an annual rate of 6.8% (Briefing.com consensus 3.3%) following a downwardly revised 7.0% decline (from -6.6%) in the third quarter.
The key takeaway from the report is that the drop in productivity was the largest quarterly decline since the second quarter of 1981.
Factory orders for manufactured goods increased 1.1% m/m in December (Briefing.com consensus 0.7%) after increasing an upwardly revised 1.3% (from 1.0%) in November. This is the eighth consecutive monthly increase in factory orders.
The key takeaway from the report is that it showed another increase in business spending, as nondefense capital goods excluding aircraft increased 0.7% in December after increasing 1.2% in November.
Looking ahead, investors will receive the Employment Situation Report for January, the Trade Balance for December, and Consumer Credit for December on Friday.
Russell 2000 +11.5% YTD
Nasdaq Composite +6.9% YTD
S&P 500 +3.1% YTD
Dow Jones Industrial Average +1.5% YTD
Market Snapshot
Dow 31055.86 +332.26 (1.08%)
Nasdaq 13777.75 +167.20 (1.23%)
SP 500 3871.74 +41.57 (1.09%)
10-yr Note 0/32 1.140
NYSE Adv 2319 Dec 854 Vol 939.0 mln
Nasdaq Adv 2838 Dec 1029 Vol 7.1 bln
Industry Watch
Strong: Financials, Information Technology, Industrials, Energy
Weak: Materials
Moving the Market
-- S&P 500, Nasdaq Composite, and Russell 2000 close at record highs amid positive momentum
-- Financial stocks outperformed
-- Apple (AAPL) provided key leadership amid EV reports
WTI crude futures extend weekly gains
04-Feb-21 15:25 ET
Dow +248.72 at 30972.32, Nasdaq +126.73 at 13737.28, S&P +30.46 at 3860.63
[BRIEFING.COM] The S&P 500 continues to hold onto a 0.8% gain, which puts it in record-close watch.
One last look at the S&P 500 sectors shows financials (+1.8%) and information technology (+1.1%) still leading the advance with gains over 1.0%. Conversely, the materials sector (-0.6%) is the only group trading lower right now amid a 7% post-earnings decline in Air Products (APD 256.02, -20.58, -7.4%).
WTI crude futures settled the session higher by 0.9%, or $0.52, to $55.70/bbl. Crude futures are now up more than 7.5% this week.
Mixed session despite strong earnings from Alphabet and Amazon
03-Feb-21 16:15 ET
Dow +36.12 at 30723.60, Nasdaq -2.23 at 13610.55, S&P +3.86 at 3830.17
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The stock market finished relatively unchanged on Wednesday, even though Alphabet (GOOG 2070.07, +142.50, +7.4%) and Amazon (AMZN 3312.53, -67.47, -2.0%) reported exceptional earnings results. The S&P 500 (+0.1%), Nasdaq Composite (unch), and Dow Jones Industrial Average (+0.1%) closed little changed, while the Russell 2000 gained 0.4%.
Alphabet shares deservedly surged 7% after the company crushed EPS estimates, but so did Amazon and its shares fell 2%. Presumably, AMZN shares were pressured by an unexpected announcement that Jeff Bezos will step down as CEO and transition into Executive Chair in the third quarter.
Price action at the index level was relatively muted throughout the day, as the market appeared to grow tired legs after a strong two-day rally.
The S&P 500 communication services sector climbed 2.1%, largely due to Alphabet's influence and a trickle-down effect on other ad-based companies. The energy sector advanced the most with a 4.3% gain amid a lingering reopening optimism. Crude futures ($55.70, +0.93, +1.7%) settled above $55.00/bbl.
The consumer discretionary (-0.8%), health care (-0.7%), real estate (-0.4%), and information technology (-0.3%) sectors were on the losing end of the action.
In the health care space, AbbVie (ABBV 106.95, +3.48, +3.4%) and Biogen (BIIB 263.25, -14.47, -5.2%) trended in opposite directions following their earnings reports. GW Pharma (GWPH 211.37, +65.12, +44.5%) agreed to be acquired by Jazz Pharmaceuticals (JAZZ 151.21, -6.08, -3.9%) for about $7.2 billion in cash and stock.
Separately, the ISM Non-Manufacturing Index rose to 58.7% in January (Briefing.com consensus 57.0%) from an upwardly revised 57.7% (from 57.2%) in December. The ADP Employment Change report estimated that 174,000 jobs were added to private-sector payrolls in January (Briefing.com consensus +55,000) following an upwardly revised 78,000 decline (from -123,000) in December.
The better-than-expected economic data continued to suggest the economy is heading in the right direction, which contributed to continued selling interest in longer-dated Treasuries. The 10-yr yield increased three basis points to 1.13%, and the 2-yr yield was flat at 0.11%. The U.S. Dollar Index decreased 0.1% to 91.13. The CBOE Volatility Index dropped 10.4% to 22.91 amid decreased hedging interest.
Reviewing Wednesday's economic data:
The ISM Non-Manufacturing Index rose to 58.7% in January (Briefing.com consensus 57.0%) from an upwardly revised 57.7% (from 57.2%) in December. The dividing line between expansion and contraction is 50.0%. The January reading is the highest since February 2019 and reflects a pickup in the pace of expansion from December.
The key takeaway from the report is the recognition that the pace of activity in the services sector accelerated in January despite the surge in coronavirus cases, the political tumult, and shutdown measures aimed at curbing the spread of the coronavirus.
The ADP Employment Change report estimated that 174,000 jobs were added to private-sector payrolls in January (Briefing.com consensus +55,000) following an upwardly revised 78,000 decline (from -123,000) in December.
The IHS Markit Services PMI for January was revised higher to 58.3 from 57.5 in the preliminary reading.
Looking ahead, investors will receive the preliminary Q4 readings for Productivity and Unit Labor Costs, weekly Initial and Continuing Claims, and Factory Orders for December on Thursday.
Russell 2000 +9.4% YTD
Nasdaq Composite +5.6% YTD
S&P 500 +2.0% YTD
Dow Jones Industrial Average +0.4% YTD
Market Snapshot
Dow 30723.60 +36.12 (0.12%)
Nasdaq 13610.55 -2.23 (-0.02%)
SP 500 3830.17 +3.86 (0.10%)
10-yr Note -3/32 1.137
NYSE Adv 1838 Dec 1332 Vol 1.0 bln
Nasdaq Adv 2389 Dec 1460 Vol 7.4 bln
Industry Watch
Strong: Communication Services, Energy
Weak: Real Estate, Health Care, Information Technology
Moving the Market
-- Alphabet (GOOG) and Amazon (AMZN) crushed EPS estimates, mixed reactions
-- Two-day rally taking a breather
-- Energy stocks extend recent gains
WTI crude futures settle above $55 per barrel
03-Feb-21 15:25 ET
Dow +83.27 at 30770.75, Nasdaq +23.73 at 13636.51, S&P +12.22 at 3838.53
[BRIEFING.COM] The S&P 500 is up 0.3%, and the Russell 2000 is up 0.4%.
One last look at the S&P sectors before the close shows energy (+4.1%) and communication services (+2.5%) firmly atop the leaderboard, while the consumer discretionary sector (-0.6%) slips to the bottom spot as shares of Amazon (AMZN 3327.66, -52.76, -1.6%) extend losses.
WTI crude futures settled higher by 1.7%, or $0.93, to $55.70/bbl.
Stock market closes higher in broad-based advance
02-Feb-21 16:15 ET
Dow +475.90 at 30687.81, Nasdaq +209.38 at 13612.78, S&P +52.41 at 3826.27
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 gained 1.4% on Tuesday in a broad-based advance, bringing its two-day gain to 3.0%. The Dow Jones Industrial Average (+1.6%) and Nasdaq Composite (+1.6%) edged out the benchmark index in terms of performance, while the Russell 2000 gained 1.2%.
All 11 S&P 500 sectors contributed to the advance, including the financials (+2.5%), industrials (+2.2%), and consumer discretionary (+2.0%) sectors with at least 2.0% gains. The health care (+0.3%) and real estate (+0.4%) sectors lagged with more modest gains.
The cyclical leadership suggested investors continued to bet on an economic recovery, supported by increasing vaccination rates and expectations for additional fiscal stimulus. The cratering in shares of GameStop (GME 90.00, -135.00, -60.0%) and AMC Entertainment (AMC 7.82, -5.48, -41.2%) was cited as a positive factor that helped guide investors back to the bigger economic picture.
In addition, UPS (UPS 160.26, +4.00, +2.6%) and Exxon Mobil (XOM 45.63, +0.71, +1.6%) highlighted the batch of better-than-expected earnings reports, and Amazon (AMZN 3380.00, +37.12, +1.1%) and Alphabet (GOOG 1927.51, +26.16, +1.4%) finished higher ahead their earnings reports after the close.
Shares of Pfizer (PFE 34.99, -0.81, -2.3%), on the other hand, declined 2.3% after the Dow component came up short of EPS expectations. Note, Pfizer did beat revenue estimates, issued upbeat FY21 guidance, and provided positive-sounding vaccine delivery commentary.
In other corporate news, AstraZeneca's (AZN 50.06, -0.34, -0.7%) COVID-19 vaccine was 82.4% effective with 3-month intervals used in UK trials, Uber (UBER 56.46, +3.70, +7.0%) agreed to acquire Drizly for approximately $1.1 billion in cash and stock, and Dell (DELL 77.17, +3.22, +4.4%) was upgraded to Buy from Neutral at Goldman.
Longer-dated U.S. Treasuries succumbed to selling pressure amid the positive outing in stocks and renewed growth optimism. The 10-yr yield increased three basis points to 1.11%, and the 2-yr yield remained unchanged at 0.11%. The U.S. Dollar Index increased 0.1% to 91.07. WTI crude futures rose 2.3%, or $1.21, to $54.77/bbl.
Investors did not receive any economic data on Tuesday. Looking ahead to Wednesday, investors will receive the ADP Employment Change Report for January, the ISM Non-Manufacturing Index for January, the final IHS Markit Services PMI for January, and the weekly MBA Mortgage Applications Index.
Russell 2000 +8.9% YTD
Nasdaq Composite +5.6% YTD
S&P 500 +1.9% YTD
Dow Jones Industrial Average +0.3% YTD
Market Snapshot
Dow 30687.81 +475.90 (1.58%)
Nasdaq 13612.78 +209.38 (1.56%)
SP 500 3826.27 +52.41 (1.39%)
10-yr Note -24/32 1.107
NYSE Adv 2406 Dec 754 Vol 1.1 bln
Nasdaq Adv 2826 Dec 1009 Vol 7.1 bln
Industry Watch
Strong: Energy, Industrials, Financials, Consumer Discretionary
Weak: Real Estate
Moving the Market
-- Stocks extend rebound rally
-- Broad-based gains led by cyclical stocks and blue-chip companies
-- Short-squeeze stocks crater
WTI crude futures gain more than 2%
02-Feb-21 15:25 ET
Dow +568.01 at 30779.92, Nasdaq +230.94 at 13634.34, S&P +63.14 at 3837.00
[BRIEFING.COM] The S&P 500 continues to trade higher by 1.7% and has nearly recouped all of last week's decline, including yesterday's gain.
One last look at the S&P 500 sectors shows green across the board. The financials (+2.7%), consumer discretionary (+2.4%), and industrials (+2.6%) sectors continue to lead the market higher with gains over 2.0%, while the real estate (+0.7%) and health care (+0.8%) sectors continue to underperform with more modest gains.
WTI crude futures settled higher by 2.3%, or $1.21, to $54.77/bbl amid the general growth optimism in the market.
Harley-Davidson and Cirrus Logic fall after earnings
02-Feb-21 14:55 ET
Dow +580.46 at 30792.37, Nasdaq +244.07 at 13647.47, S&P +66.72 at 3840.58
[BRIEFING.COM] The S&P 500 continues to trade at session highs with a 1.8% gain. The Russell 2000 underperforms with a 1.2% gain.
It's a good day for sure, but not all stocks are rising with the tide. Besides the short-squeeze stocks, shares of Harley-Davidson (HOG 33.15, -7.00, -17.4%) and Cirrus Logic (CRUS 91.21, -6.65, -6.8%) are down 17% and 7%, respectively, following their earnings reports.
Harley missed Q4 estimates, while Cirrus reported in-line quarterly guidance that reportedly disappointed investors.
As a reminder, Amazon (AMZN 3416.29, +73.43, +2.2%) and Alphabet (GOOG 1937.86, +36.51, +1.9%) will report earnings after the close.
Rebound rally paced by the mega-caps
01-Feb-21 16:15 ET
Dow +229.29 at 30211.91, Nasdaq +332.70 at 13403.40, S&P +59.62 at 3773.86
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 rose 1.6% on Monday in a broad-based advance paced by the mega-caps, as investors used last week's decline as an opportunity to buy the dip. The Nasdaq Composite (+2.6%) and Russell 2000 (+2.5%) outperformed with gains over 2.0%, while the Dow Jones Industrial Average increased 0.8%.
Key leadership was provided by market favorites like Microsoft (MSFT 239.65, +7.69, +3.3%), Amazon (AMZN 3342.88, +136.68, +4.3%), Alphabet (GOOG 1901.35, +65.61, +3.6%), and Tesla (TSLA 839.81, +46.28, +5.8%), which in turn boosted the information technology (+2.5%), consumer discretionary (+2.8%), and communication services (+1.8%) sectors.
Every other S&P 500 sector also closed higher, with the consumer staples sector (+0.02%) eking out a fractional gain. The Philadelphia Semiconductor Index bounced back 3.9%.
Because last week's decline was largely attributed to the short-squeeze mania, it's worth noting that GameStop (GME 225.00, -100.00, -30.8%) shares dropped 31% on Monday in a move that might have comforted fundamentally-oriented investors and restored risk sentiment. Wall Street strategists also eased concerns about the mania having a contagion effect on the broad market.
The silver market, meanwhile, appeared to be the latest short-squeeze target, although the price action was noticeably tamer. Silver futures settled higher by 7.9% to $29.21/ozt.
In positive-sounding macro developments, the January ISM Manufacturing Index checked in at 58.7% (Briefing.com consensus 60.1%) for its eighth straight expansionary reading, President Biden was said to be committed to his $1.9 trillion stimulus bill despite a $600 billion proposal from GOP senators, and reports indicated that COVID-19 vaccination rates are increasing.
The market is expecting additional fiscal stimulus, whether it be targeted or broad, especially after the Congressional Budget Office (CBO) said it doesn't expect employment to recover to pre-pandemic levels until 2024. Note, the CBO also projected that real GDP would return to pre-pandemic levels in mid-2021.
U.S. Treasuries finished on a higher note despite the rebound effort in the stock market, signaling a cautious-minded sentiment. The 2-yr yield decreased one basis point to 0.11%, and the 10-yr yield decreased two basis points to 1.08%. The U.S. Dollar Index advanced 0.5% to 91.05. WTI crude futures rose 2.6%, or $1.38, to $53.56/bbl.
Reviewing Monday's economic data:
The ISM Manufacturing Index for January slipped to 58.7% (Briefing.com consensus 60.1%) from a downwardly revised 60.5% (from 60.7%) for December. The dividing line between expansion and contraction is 50.0%. January marked the eighth straight month the ISM Manufacturing Index has been above 50.0%.
The key takeaway from the report is the recognition that manufacturing activity overall remained at a healthy level in January despite the surge in coronavirus cases, shutdown measures enacted to contain the spread of the coronavirus, and the political tumult in the U.S.
Total construction spending increased 1.0% m/m in December (Briefing.com consensus 0.8%) after increasing an upwardly revised 1.1% (from 0.9%) in November. Total private construction spending rose 1.2% m/m and total public construction spending increased 0.5%.
The key takeaway from the report is that residential construction spending continued at a solid clip, fueled by robust demand for new homes.
The January IHS Markit Manufacturing PMI increased to 59.2 from 59.1 in December.
There is no economic data of note scheduled for Tuesday.
Russell 2000 +7.7% YTD
Nasdaq Composite +4.0% YTD
S&P 500 +0.5% YTD
Dow Jones Industrial Average -1.3% YTD
Market Snapshot
Dow 30211.91 +229.29 (0.76%)
Nasdaq 13403.40 +332.70 (2.55%)
SP 500 3773.86 +59.62 (1.61%)
10-yr Note -1/32 1.070
NYSE Adv 2492 Dec 700 Vol 1.1 bln
Nasdaq Adv 2965 Dec 894 Vol 6.9 bln
Industry Watch
Strong: Information Technology, Consumer Discretionary, Real Estate, Communication Services
Weak: Consumer Staples, Energy, Utilities
Moving the Market
-- Stock market rebounds in buy-the-dip trade
-- Leadership from the mega-cap stocks
-- GameStop (GME) shares dropped 31%
-- Encouraging manufacturing data, continued expectations for additional stimulus
WTI crude futures settle in positive territory
01-Feb-21 15:30 ET
Dow +288.90 at 30271.52, Nasdaq +334.15 at 13404.85, S&P +64.17 at 3778.41
[BRIEFING.COM] The S&P 500 is up 1.7% and is back in positive territory for the year.
One last look at the S&P sectors before the close shows information technology (+2.7%), consumer discretionary (+2.4%), and communication services (+2.1%) leading the advance with gains over 2.0%. The consumer staples sector underperforms with a modest 0.3% gain.
WTI crude futures settled higher by 2.6%, or $1.38, to $53.56/bbl.
Rebellious spirt undercuts risk sentiment in weak session
29-Jan-21 16:15 ET
Dow -620.74 at 29982.62, Nasdaq -266.46 at 13070.70, S&P -73.14 at 3714.24
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 fell 1.9% on Friday, as the continuation of the short-squeeze mania wore out investors and fed into concerns about fund managers selling long positions to cover their shorts. The Nasdaq Composite declined 2.0%, the Dow Jones Industrial Average declined 2.0%, and the Russell 2000 declined 1.6%.
Brokerage firms, most notably Robinhood, eased some of the trading restrictions they temporarily placed yesterday on heavily-shorted stocks like GameStop (GME 325.00, +131.40, +67.9%) and AMC Entertainment (AMC 13.26, +4.63, +53.7%). There were still limitations, though, which might have tempered the intraday rebound gains in these stocks.
It was evident that the so-called rebellious spirt among retail traders was still burning strong today. Considering these emotions, the volatility, and recent commentary about the market being vulnerable for a correction, there was an accompanying suspicion if the short-squeeze mania was the catalyst for a potentially extended pullback.
From a technical perspective, the S&P 500 closed marginally below its 50-day moving average (3716), which is a key technical level many traders watch for short-term purposes. All 11 S&P 500 sectors finished lower with losses ranging from 0.5% (utilities) to 3.4% (energy).
Separately, better-than-expected earnings reports and encouraging vaccine news failed to inspire enthusiasm in the broad market.
Dow components Visa (V 193.25, -4.97, -2.5%), Honeywell (HON 195.37, -7.47, -3.7%), Caterpillar (CAT 182.84, -1.50, -0.8%), and Chevron (CVX 85.20, -3.82, -4.3%) closed lower following their earnings reports.
Johnson & Johnson (JNJ 163.13, -6.03, -3.6%) said its single-dose vaccine candidate was 66% effective in protecting against COVID-19, and Novavax (NVAX 220.94, +86.93, +64.9%) said its vaccine candidate produced an 89.3% efficacy rate in its Phase 3 trial in the UK. NVAX shares rose 65%.
Interestingly, longer-dated Treasuries traded lower despite the weakness in equities, which was symptomatic of cash-raising efforts. The 2-yr yield decreased one basis point to 0.11%, while the 10-yr yield increased four basis points to 1.09%. The U.S. Dollar Index increased 0.1% to 90.55. WTI crude futures decreased 0.2%, or $0.12, to $52.18/bbl.
Reviewing Friday's economic data:
Personal income increased 0.6% m/m in December (Briefing.com consensus 0.1%) and personal spending declined 0.2% (Briefing.com consensus -0.5%). The PCE Price Index was up 0.4% m/m (Briefing.com consensus 0.3%) and the core PCE Price Index was up 0.3% (Briefing.com consensus 0.1%), leaving the yr/yr rates at 1.3% and 1.5%, respectively.
The key takeaway from the report is that it wasn't as bad as feared, which qualifies as good news for a market that has seen a number of economic reports of late not live up to expectations.
The Q4 Employment Cost Index increased 0.7% (Briefing.com consensus 0.5%), seasonally adjusted, for the three-month period ending in December 2020 after increasing 0.5% for the three-month period ending September 2020. Wages and salaries, which account for about 70% of compensation costs, rose 0.9%, while benefit costs, which make up the remainder of compensation costs, increased 0.6%.
The key takeaway from the report is that compensation costs for civilian workers, private industry workers, and state and local government workers all moderated from the same period a year ago.
The final January reading for the University of Michigan Index of Consumer Sentiment checked in at 79.0 (Briefing.com consensus 79.2) versus the preliminary reading of 79.2 and the final reading of 80.7 for December.
The key takeaway from the report is that sentiment held relatively steady in January despite rising coronavirus cases/deaths, the insurrection, the impeachment of President Trump, and a deterioration in the labor market.
Pending home sales decreased 0.3% m/m in December (Briefing.com consensus -0.5%) following a revised 2.5% decline in November (from -2.6%).
The Chicago PMI for January increased to 63.8 (Briefing.com consensus 58.0) from a downwardly revised 58.7 in December (from 59.5).
Looking ahead, investors will receive the ISM Manufacturing Index for January and Construction Spending for December on Monday.
Russell 2000 +5.0% YTD
Nasdaq Composite +1.4% YTD
S&P 500 -1.1% YTD
Dow Jones Industrial Average -2.0% YTD
Market Snapshot
Dow 29982.62 -620.74 (-2.03%)
Nasdaq 13070.70 -266.46 (-2.00%)
SP 500 3714.24 -73.14 (-1.93%)
10-yr Note -3/32 1.079
NYSE Adv 865 Dec 2175 Vol 1.6 bln
Nasdaq Adv 1163 Dec 2575 Vol 7.7 bln
Industry Watch
Strong: Utilities
Weak: Energy, Financials, Consumer Discretionary, Industrials, Information Technology
Moving the Market
-- Weak session to end the week
-- Brokerage firms eased some trading restrictions on heavily-shorted stocks, sending these stocks higher
-- Johnson & Johnson (JNJ) and Novavax (NVAX) provided encouraging vaccine updates
-- Negative earnings reactions
Crude futures settle lower, equities pare losses
29-Jan-21 15:30 ET
Dow -455.74 at 30147.62, Nasdaq -202.84 at 13134.32, S&P -54.90 at 3732.48
[BRIEFING.COM] The S&P 500 continue to pare losses and is now down 1.3%. The Russell 2000 is down 1.4%.
One last look at the S&P 500 sectors shows every sector still trading lower, but the utilities sector (-0.1%) briefly emerged into positive territory earlier amid strength in Duke Energy (DUK 94.04, +2.26, +2.8%). The energy sector remains the weakest link with a 2.8% decline.
WTI crude futures settled lower by 0.2%, or $0.12, to $52.18/bbl.
Weak session amid short-squeeze mania
27-Jan-21 16:20 ET
Dow -633.87 at 30303.17, Nasdaq -355.47 at 13270.60, S&P -98.85 at 3750.77
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The large-cap indices fell more than 2.0% on Wednesday, as risk sentiment was undercut by another day of extreme short squeezes and underwhelming earnings reactions. The S&P 500 (-2.6%) and Dow Jones Industrial Average (-2.1%) gave up their yearly gains in the process. The Nasdaq Composite declined 2.6%, and Russell 2000 declined 1.9%.
GameStop (GME 347.51, +199.53, +135%) remained the prominent example of the short-squeeze mania today, as shares more than doubled (again) in an apparent move fueled by an online community. AMC Entertainment (AMC 19.90, +14.94, +301%), Nokia (NOK 6.55, +1.82, +38.5%), and BlackBerry (BB 25.10, +6.18, +32.7%) were other beneficiaries.
In addition to this frenzied price action, the inability of Microsoft (MSFT 232.90, +0.57, +0.3%) to drive the market higher following its strong earnings report and upbeat guidance was cited as another headwind for sentiment. Put another way, investors took some money off the table ahead of more mega-cap earnings after the close.
Every sector in the S&P 500 closed sharply lower with losses ranging from 1.4% (energy) to 3.8% (communication services). The CBOE Volatility Index surged 61.6% to 37.21 amid increased interest to hedge against further equity weakness.
Starbucks (SBUX 97.87, -6.82, -6.5%), Boeing (BA 194.03, -8.03, -4.0%), Adv. Micro Devices (AMD 88.84, -5.87, -6.5%), and Texas Instruments (TXN 162.93, -8.54, -5.0%) were notable laggards following their earnings reports. On a related note, Starbuck's COO left to become the CEO of Walgreens Boots Alliance (WBA 51.18, +1.99, +4.1%).
In the afternoon, Fed Chair Powell preferred not to comment on the day's market activity, although he said that expectations for fiscal policy and vaccines, instead of monetary policy, have been driving asset prices in recent months. The central bank made no changes to its accommodative policy stance, as widely expected.
U.S. Treasuries finished with modest gains amid the weak performance in the stock market and were less influenced by the Fed today. The 2-yr yield declined one basis point to 0.12%, and the 10-yr yield declined three basis points to 1.01%. The U.S. Dollar Index rose 0.5% to 90.65. WTI crude futures increased 0.4% to $52.84/bbl amid bullish inventory data.
Reviewing Wednesday's economic data:
New orders for durable goods increased 0.2% m/m in December (Briefing.com consensus 0.9%) following an upwardly revised 1.2% increase (from 0.9%) in November. Excluding transportation, orders rose 0.7% m/m (Briefing.com consensus 0.5%) following an upwardly revised 0.8% increase (from 0.4%) in November.
The key takeaway from the report is that manufacturing activity for durable goods held up reasonably well in December despite the surge in coronavirus cases and restrictive measures aimed at curbing the spread.
The MBA Mortgage Applications Index decreased 4.1% following a 1.9% decline in the prior week.
Looking ahead to Thursday, investors will receive the advance estimate for Q4 GDP, weekly Initial and Continuing Claims, New Home Sales for December, the Conference Board's Leading Economic Index for December, and advance December readings for Intl Trade in Goods, Retail Inventories, and Wholesale Inventories.
Russell 2000 +6.8% YTD
Nasdaq Composite +3.0% YTD
S&P 500 -0.1% YTD
Dow Jones Industrial Average -1.0% YTD
Market Snapshot
Dow 30303.17 -633.87 (-2.05%)
Nasdaq 13270.60 -355.47 (-2.61%)
SP 500 3750.77 -98.85 (-2.57%)
10-yr Note +2/32 1.014
NYSE Adv 541 Dec 2562 Vol 1.7 bln
Nasdaq Adv 615 Dec 3106 Vol 1.1 bln
Industry Watch
Strong: Energy
Weak: Communication Services, Financials, Health Care, Materials, Consumer Discretionary
Moving the Market
-- Weak session amid continued short-squeeze mania
-- Fed kept rates unchanged as widely expected, committed to accommodative monetary policy
-- Better-than-expected earnings reports unable to drive market higher
Oil prices gain on bullish inventory data
27-Jan-21 15:30 ET
Dow -574.62 at 30362.42, Nasdaq -357.56 at 13268.51, S&P -96.00 at 3753.62
[BRIEFING.COM] The S&P 500 is trading at new session lows with a 2.6% decline. The Russell 2000 is down 1.6%.
One last look at the S&P sectors shows losses ranging from 1.2% (energy) to 4.0% (communication services). The Philadelphia Semiconductor Index is also struggling with a steep 5.2% decline, as investors take profits in the space despite AMD (AMD 88.68, -6.03, -6.4%) and Texas Instruments (TXN 162.60, -8.87, -5.2%) beating earnings estimates.
WTI crude futures settled higher by 0.4%, or $0.22, to $52.84/bbl amid a bullish EIA inventory report.
Dow -22.96 at 30937.04, Nasdaq -9.93 at 13626.07, S&P -5.74 at 3849.62
Market takes a breather in mixed session
26-Jan-21 16:15 ET
Dow -22.96 at 30937.04, Nasdaq -9.93 at 13626.07, S&P -5.74 at 3849.62
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The large-cap indices closed slightly lower on Tuesday, with the S&P 500 losing 0.2% after hitting an all-time high shortly after the open. The Nasdaq Composite (-0.1%) and Dow Jones Industrial Average (-0.1%) performed comparably in a tight-ranged session, while the Russell 2000 (-0.6%) underperformed.
Sector performances were mixed. The S&P 500 real estate (+1.1%), consumer staples (+0.9%), and communication services (+0.8%) finished atop the standings with decent gains, while the energy (-2.1%), materials (-1.4%), utilities (-1.0%), industrials (-0.9%), and financials (-0.8%) sectors struggled in negative territory.
In a sense, market dynamics remained consistent with those in recent sessions, such that value stocks underperformed, mega-cap stocks provided influential support, and GameStop (GME 147.98, +71.19, +92.7%) continued to captivate Wall Street with its speculative run. Microsoft (MSFT 232.33, +2.29, +1.2%) gained 1% ahead of its earnings report after the close.
The latest batch of earnings reports, meanwhile, came in mostly better than expected with little market-moving effect.
Johnson & Johnson (JNJ 170.48, +4.50, +2.7%), General Electric (GE 11.29, +0.30, +2.7%), and 3M (MMM 175.95, +5.56, +3.3%) were notable winners, while Verizon (VZ 56.57, -1.85, -3.2%) and American Express (AXP 116.15, -5.00, -4.1%) had disappointing reactions to their positive results. JNJ and Verizon also issued upbeat guidance.
Separately, shares of Beyond Meat (BYND 186.83, +28.10, +17.7%) gained 18% after the company formed a joint venture with PepsiCo (PEP 141.80, +1.62, +1.2%) to create plant-based snacks and beverages. Twitter (TWTR 49.67, +1.83, +3.8%) shares rose 4% after the company said it acquired Revue, a service to create editorial newsletters.
U.S. Treasuries finished little changed in a lackluster session. The 2-yr yield was flat at 0.12%, and the 10-yr yield was flat at 1.04%. The U.S. Dollar Index decreased 0.3% to 90.14. WTI crude futures decreased 0.3%, or $0.15, to $52.62/bbl.
Reviewing Tuesday's economic data:
The Conference Board's Consumer Confidence Index increased to 89.3 in January (Briefing.com consensus 89.0) from a downwardly revised 87.1 (from 88.6) in December.
The key takeaway from the report is that the optimism about the short-term outlook outweighed a weakening view about current business and labor market conditions.
The S&P Case-Shiller Home Price Index increased 9.1% in November (Briefing.com consensus 9.0%) following an upwardly revised 8.0% reading in October (from +7.9%).
The FHFA Housing Price Index increased 1.0% in November.
Looking ahead, investors will receive Durable Goods Orders for December, the FOMC Rate Decision, and the weekly MBA Mortgage Applications Index on Wednesday.
Russell 2000 +8.9% YTD
Nasdaq Composite +5.7% YTD
S&P 500 +2.5% YTD
Dow Jones Industrial Average +1.1% YTD
Market Snapshot
Dow 30937.04 -22.96 (-0.07%)
Nasdaq 13626.07 -9.93 (-0.07%)
SP 500 3849.62 -5.74 (-0.15%)
10-yr Note -1/32 1.042
NYSE Adv 1283 Dec 1852 Vol 1.1 bln
Nasdaq Adv 1436 Dec 2381 Vol 6.6 bln
Industry Watch
Strong: Communication Services, Real Estate, Consumer Staples
Weak: Materials, Financials, Utilities, Industrials, Energy
Moving the Market
-- Market takes a breather in mixed and tight-ranged session
-- Earnings reports were mostly better than expected
Crude futures edge lower, energy stocks lag
26-Jan-21 15:25 ET
Dow +54.01 at 31014.01, Nasdaq +14.59 at 13650.59, S&P +4.42 at 3859.78
[BRIEFING.COM] The S&P 500 is up 0.1% and is vying for a record close with a positive finish.
One last look at the sectors shows mixed results. Real Estate (+1.2%), communication services (+0.9%), and consumer staples (+1.0%) are currently in the lead, while the energy (-1.7%) and materials (-0.8%) sectors continue to underperform in the red.
WTI crude futures settled lower by 0.3%, or $0.15, to $52.62/bbl.
Record closes for the S&P 500 and Nasdaq
25-Jan-21 16:15 ET
Dow -36.98 at 30960.00, Nasdaq +92.93 at 13636.00, S&P +13.89 at 3855.36
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 (+0.4%) and Nasdaq Composite (+0.7%) closed at record highs on Monday in a volatile session, as gains in the mega-caps and other defensive-oriented stocks outweighed losses in cyclical stocks. The Dow Jones Industrial Average (-0.1%) and Russell 2000 (-0.3%) closed in the red but off session lows.
The session started on a hot note, with shares of Apple (AAPL 142.92, +3.86, +2.8%) and Tesla (TSLA 880.80, +34.16, +4.0%) leading the mega-cap charge as analysts raised their price targets ahead of their earnings reports this week, and stocks with high short-interest positions like GameStop (GME 76.79, +11.78, +18.1%) continued to squeeze short sellers. GME shares were up 145% at one point today.
At their intraday morning highs, the S&P 500 was up 0.5%, the Nasdaq was up 1.4%, and the Russell 2000 was up 1.2% at an all-time high. The Dow was never positive. The major indices, however, quickly took a relatively precipitous fall into negative territory on no specific news catalyst, suggesting a profit-taking motive among investors.
True to recent usual form, investors bought the intraday dip, but generally preferred to stick with most of the mega-cap names and lower-beta stocks within the S&P 500 utilities (+2.0%), consumer staples (+0.9%), real estate (+0.8%), and health care (+0.7%) sectors. The information technology sector rose 0.9%.
The cyclical energy (-1.1%), financials (-0.8%), industrials (-0.7%), and materials (-0.5%) sectors finished lower amid news that President Biden's $1.9 trillion stimulus deal is facing bipartisan resistance and could be pushed back to mid-March. The latter was an observation from Senate Majority Leader Schumer.
Lingering recovery concerns contributed to increased demand for longer-dated Treasuries, which caused some curve-flattening activity that pressured the financials space. The 10-yr yield fell five basis points to 1.04%, versus a flat reading on the 2-yr yield (0.12%). The U.S. Dollar Index increased 0.2% to 90.37. WTI crude futures rose 0.8%, or $0.44, to $52.77/bbl.
In other developments, Moderna (MRNA 147.00, +15.98, +12.2%) said its COVID-19 vaccine does protect against the variants that originated in the UK and South Africa, President Biden signed an executive order aimed at restoring the competitiveness of domestic manufacturers, and California Governor Newsom confirmed that the stay-at-home order has been removed in all regions.
Investors did not receive any notable economic data on Monday. Looking ahead, the Consumer Confidence Index for January, the S&P Case-Shiller Home Price Index for November, and the FHFA Housing Price Index for January will be released on Tuesday.
Russell 2000 +9.5% YTD
Nasdaq Composite +5.8% YTD
S&P 500 +2.6% YTD
Dow Jones Industrial Average +1.2% YTD
Market Snapshot
Dow 30960.00 -36.98 (-0.12%)
Nasdaq 13636.00 +92.93 (0.69%)
SP 500 3855.36 +13.89 (0.36%)
10-yr Note +6/32 1.030
NYSE Adv 1309 Dec 1857 Vol 1.2 bln
Nasdaq Adv 1792 Dec 1973 Vol 7.0 bln
Industry Watch
Strong: Consumer Staples, Utilities, Real Estate, Health Care
Weak: Energy, Financials, Industrials
Moving the Market
-- Positive start rolls over amid no specific catalysts, but investors are buying the dip
-- Short-squeeze continues in speculative stocks
-- Value and cyclical stocks underperform
Crude futures settle on higher note
25-Jan-21 15:25 ET
Dow -124.91 at 30872.07, Nasdaq +29.86 at 13572.93, S&P +0.86 at 3842.33
[BRIEFING.COM] The S&P 500 is trading little changed ahead of a busy rest of the week, which will include key earnings reports and a Fed policy decision on Wednesday.
One last look at the S&P 500 sectors shows utilities (+1.6%), real estate (+0.9%), and consumer staples (+0.8%) outperforming in positive territory, while the energy (-1.5%), materials (-1.0%), and financials (-0.8%) sectors continue to lag in negative territory.
WTI crude futures settled higher by 0.8%, or $0.44, to $52.77/bbl.
Nasdaq and Russell 2000 close at fresh record highs
22-Jan-21 16:15 ET
Dow -179.03 at 30996.98, Nasdaq +12.15 at 13543.07, S&P -11.60 at 3841.47
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The Nasdaq Composite (+0.1%) eked out another closing record high on Friday, overcoming a negative start and capping off a strong week for the tech-sensitive index. The Russell 2000 rallied 1.3% and closed at a record high in a steady advance off opening lows, while the S&P 500 (-0.3%) and Dow Jones Industrial Average (-0.6%) closed lower.
The negative start was attributed to news that EU leaders are considering tighter lockdown measures to curb the spread of the coronavirus, including a UK variant that could have a higher mortality rate, and reports of more Republican lawmakers pushing back against President Biden's $1.9 trillion stimulus proposal.
These headlines stirred lingering growth concerns, which were manifested in the underperformance of the S&P 500 financials (-0.7%), industrials (-0.5%), and energy (-0.5%) sectors. Oil prices ($52.33/bbl, -0.79, -1.5%) also softened up, and the growth-sensitive 10-yr Treasury note yield decreased two basis points to 1.09% amid an uptick in demand.
Most sectors gradually pared losses throughout the day, while the counter-cyclical real estate (+0.3%), utilities (+0.2%), and communication services (+0.1%) sectors finished with modest gains.
At the individual stock level, money continued to flow into Apple (AAPL 139.07, +2.20, +1.6%) and Microsoft (MSFT 225.95, +0.98, +0.4%), two of the largest and most liquid stocks in the market, following positive-minded analyst recommendations. Speculators, meanwhile, continued to reap the benefits of their bets, most notably GameStop (GME 65.01, +21.98, +51.1%) today.
On a related note, Apple had its price target raised to $153 from $133 at Cowen, and Microsoft was initiated with a Buy rating at Goldman Sachs.
Separately, shares of Intel (INTC 56.66, -5.80, -9.3%) and IBM (IBM 118.61, -13.04, -9.9%) both dropped nearly 10.0% following their earnings reports and commentary. Note, Intel's positive results were leaked prior to yesterday's close, so the negative reaction might have attributed to the company's acknowledgment that it will continue to manufacture most of its products through 2023.
The 2-yr yield was unchanged at 0.12%. The U.S. Dollar Index increased 0.1% to 90.23.
Reviewing Friday's economic data, which featured Existing Home Sales for December:
Existing home sales increased 0.7% m/m in December to a seasonally adjusted annual rate of 6.76 million (Briefing.com consensus 6.50 million).
The key takeaway from the report is that the supply of existing homes is at an all-time low. That is going to be a pressure point that feeds higher prices, shuts out an increasing number of first-time buyers, and bolsters the prospects for new home sales.
The January IHS flash Markit Manufacturing PMI checked in at 59.1 versus 57.1 in December; the January flash Services PMI checked in at 57.5 versus 54.8 in December.
Investors will not receive any notable economic data on Monday.
Russell 2000 +9.8% YTD
Nasdaq Composite +5.1% YTD
S&P 500 +2.3% YTD
Dow Jones Industrial Average +1.3% YTD
Market Snapshot
Dow 30996.98 -179.03 (-0.57%)
Nasdaq 13543.07 +12.15 (0.09%)
SP 500 3841.47 -11.60 (-0.30%)
10-yr Note +25/32 1.085
NYSE Adv 1683 Dec 1436 Vol 1.1 bln
Nasdaq Adv 2293 Dec 1493 Vol 5.9 bln
Industry Watch
Strong: Communication Services, Real Estate, Utilities
Weak: Energy, Industrials, Materials, Financials
Moving the Market
-- Nasdaq and Russell 2000 close at fresh record highs, overcoming negative starts
-- IBM (IBM) and Intel (INTC) dropped nearly 10.0% after earnings
-- Cyclical stocks underperformed amid lingering growth concerns
Crude futures settle on lower note
22-Jan-21 15:30 ET
Dow -113.34 at 31062.67, Nasdaq +19.73 at 13550.65, S&P -4.44 at 3848.63
[BRIEFING.COM] The S&P 500 is down 0.1% but is on record-close watch since any positive finish would be good for a closing record high.
One last look at the S&P 500 sectors shows no sector trading higher or lower by at least 1.0%. The energy sector (-0.7%) remains the weakest link but is well off session lows, while the real estate sector (+0.5%) outperforms with a 0.5% gain.
WTI crude futures settled lower by 1.5%, or $0.79, to $52.33/bbl. On a related note, the EIA reported an unexpected build (4.35 mln) in weekly crude inventory.
Apple and company carry Nasdaq to new heights
21-Jan-21 16:15 ET
Dow -12.37 at 31176.01, Nasdaq +73.67 at 13530.92, S&P +1.22 at 3853.07
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The Nasdaq Composite (+0.6%) and S&P 500 (+0.03%) closed at new record highs on Thursday, largely due to continued strength in several mega-cap stocks that disproportionately benefited the Nasdaq. The Dow Jones Industrial Average (-0.04%) finished on the negative side of its flat line, and the Russell 2000 declined 0.9%.
Apple (AAPL 136.87, +4.84, +3.7%) was the most influential mover today with a 3.7% gain, which was aided by a price-target increase to $152 from $144 at Morgan Stanley. Amazon (AMZN 3306.99, +43.61, +1.3%) and Facebook (FB 272.87, +5.39, +2.0%) joined Apple as mega-cap leaders and extended their weekly gains to between 6-8%.
These household names propped up the S&P 500 information technology (+1.3%), consumer discretionary (+0.6%), and communication services (+0.3%) sectors. Semiconductor, homebuilding, and retail stocks also contributed to their positive performances.
These were the only S&P sectors that closed higher, though. The energy sector (-3.4%) succumbed to profit-taking interest that trimmed its monthly gain to 11.5%. The materials (-1.5%), financials (-1.1%), and industrials (-0.8%) sectors also finished as laggards.
Providing more color on the homebuilding and semiconductor stocks, these spaces drew support from a better-than-expected housing starts and building permits report for December and a strong earnings report from Intel (INTC 62.46, +3.79, +6.5%), which was released early.
The iShares US Home Construction ETF (ITB 61.38, +0.90, +1.5%) and Philadelphia Semiconductor Index (+1.5%) closed at record highs.
In other developments, weekly initial claims remained elevated at 900,000 (Briefing.com consensus 845,000); Travelers (TRV 148.72, +3.70, +2.6%) beat EPS estimates on below-consensus revenue; and President Biden signed many executive orders, including one to invoke the Defense Production Act to help increase the supply of PPE to curb the spread of the coronavirus.
Longer-dated U.S. Treasuries finished on a lower note. The 2-yr yield was flat at 0.12%, and the 10-yr yield increased two basis points to 1.11%. The U.S. Dollar Index declined 0.4% to 90.08. WTI crude futures declined 0.3%, or $0.16, to $53.12/bbl.
Reviewing Thursday's economic data:
Initial claims for the week ending January 16 declined by 26,000 to 900,000 (Briefing.com consensus 845,000). Continuing claims for the week ending January 9 decreased by 127,000 to 5.054 million.
The key takeaway from the report should speak for itself. The level of initial claims is still terribly high and indicative of why calls for more jobless assistance are being made.
Housing starts increased 5.8% m/m in December to a seasonally adjusted annual rate of 1.669 million (Briefing.com consensus 1.560 million). That was the strongest pace of starts since September 2006. Building permits rose 4.5% m/m to 1.709 million (Briefing.com consensus 1.600 million), which was the strongest pace since August 2006.
The key takeaway from the report is that the growth was driven entirely by single-unit dwellings. The growth there was strong, too, which is a good indicator for the homebuilding stocks.
The Philadelphia Fed Index jumped to 26.5 in January (Briefing.com consensus 12.0) from an upwardly revised 9.1 in December (from 8.5).
Looking ahead, investors will receive Existing Home Sales for December and the flash IHS Markit Manufacturing and Services PMIs for January on Friday.
Russell 2000 +8.4% YTD
Nasdaq Composite +5.0% YTD
S&P 500 +2.6% YTD
Dow Jones Industrial Average +1.9% YTD
Market Snapshot
Dow 31176.01 -12.37 (-0.04%)
Nasdaq 13530.92 +73.67 (0.55%)
SP 500 3853.07 +1.22 (0.03%)
10-yr Note -23/32 1.099
NYSE Adv 1223 Dec 1908 Vol 890.2 mln
Nasdaq Adv 1675 Dec 2132 Vol 7.1 bln
Industry Watch
Strong: Information Technology, Consumer Discretionary, Communication Services
Weak: Energy, Industrials, Financials, Materials
Moving the Market
-- S&P 500 and Nasdaq close at record highs, although the benchmark index finished marginally higher
-- Continued strength in mega-cap stocks, while most sectors finished lower
-- Better-than-expected housing starts and building permits data for December
WTI crude futures settle slightly lower, energy stocks fall
21-Jan-21 15:25 ET
Dow +17.67 at 31206.05, Nasdaq +87.38 at 13544.63, S&P +6.22 at 3858.07
[BRIEFING.COM] The S&P 500 continues to trade higher by 0.2% while the Nasdaq is trading at session highs with a 0.7% gain.
One last look at the S&P 500 sectors shows information technology (+1.4%), consumer discretionary (+0.8%), and communication services (+0.4%) still trading in positive territory. The energy sector is the weakest link with a 3.1% decline, followed by the materials sector with a 1.3% decline.
WTI crude futures settled lower by 0.3%, or $0.16, to $53.12/bbl.
Mega-caps power market to new records on Inauguration Day
20-Jan-21 16:15 ET
Dow +257.86 at 31188.38, Nasdaq +260.07 at 13457.25, S&P +52.94 at 3851.85
https://www.briefing.com/stock-market-update
[BRIEFING.COM] Each of the major indices closed at fresh record highs on Wednesday in a session that featured the mega-caps as leaders and Joe Biden inaugurated as the 46th president. The Nasdaq Composite (+2.0%) outperformed with a 2% gain, followed by gains in the S&P 500 (+1.4%), Dow Jones Industrial Average (+0.8%) and Russell 2000 (+0.4%).
Shares of Apple (AAPL 132.03, +4.20, +3.3%), Microsoft (MSFT 224.34, +7.90, +3.7%), Amazon (AMZN 3263.38, +142.62, +4.6%), Alphabet (GOOG 1886.90, +96.04, +5.4%), and Facebook (FB 267.48, +6.38, +2.4%) gained between 2-5%. The Vanguard Mega Cap Growth ETF (MGK 207.13, +5.20, +2.6%) increased 2.6%.
Netflix (NFLX 586.34, +84.57, +16.9%) was credited as a supporting catalyst for the mega-cap rally, as shares surged 17% after the company provided bullish subscriber results, guidance, and commentary. Notably, Netflix said it believes it no longer needs to raise external financing for day-to-day operations.
In turn, the S&P 500 communication services (+3.6%), information technology (+2.0%), and consumer discretionary (+2.3%) sectors claimed today's top spots.
Every other sector, except financials (-0.5%), as well as small-cap and mid-cap stocks contributed to the steady advance, albeit to a lesser extent. The financials sector was undercut by negative reactions to better-than-expected earnings reports from Morgan Stanley (MS 74.84, -0.15, -0.2%), U.S. Bancorp (USB 45.58, -2.49, -5.2%), and BNY Mellon (BK 42.49, -3.33, -7.3%).
Dow components UnitedHealth (UNH 350.84, -1.35, -0.4%) and Procter & Gamble (PG 131.93, -1.67, -1.3%) also closed lower despite beating EPS estimates, which factored into the relative underperformance of the Dow, versus the S&P 500 and Nasdaq.
U.S. Treasuries finished little changed in a tight-ranged session. The 2-yr yield decreased one basis point to 0.12%, and the 10-yr yield remained unchanged at 1.09%. The U.S. Dollar Index finished little changed at 90.46. WTI crude futures increased 0.6%, or $0.30, to $53.28/bbl.
Reviewing Wednesday's economic data, which were non-events:
The NAHB Housing Market Index decreased to 83 in January (Briefing.com consensus 88) from 86 in December.
The weekly MBA Mortgage Applications Index decreased 1.9% following a 16.7% spike in the prior week.
Looking ahead, investors will receive the weekly Initial and Continuing Claims report, Housing Starts and Building Permits for December, and the Philadelphia Fed Index for January on Thursday.
Russell 2000 +9.4% YTD
Nasdaq Composite +4.4% YTD
S&P 500 +2.6% YTD
Dow Jones Industrial Average +1.9% YTD
Market Snapshot
Dow 31188.38 +257.86 (0.83%)
Nasdaq 13457.25 +260.07 (1.97%)
SP 500 3851.85 +52.94 (1.39%)
10-yr Note 0/32 1.089
NYSE Adv 1990 Dec 1119 Vol 992.2 mln
Nasdaq Adv 2102 Dec 1651 Vol 6.7 bln
Industry Watch
Strong: Communication Services, Information Technology, Consumer Discretionary
Weak: Financials, Consumer Staples
Moving the Market
-- Mega-caps power market to fresh record closes
-- Netflix (NFLX) shares climbed 17% after earnings report
-- Joe Biden inaugurated as the 46th president
Semiconductor stocks taking a breather
20-Jan-21 15:25 ET
Dow +240.03 at 31170.55, Nasdaq +280.27 at 13477.45, S&P +56.03 at 3854.94
[BRIEFING.COM] The S&P 500 continues to trade higher by 1.5% amid convincing leadership from most mega-cap stocks. The small-cap Russell 2000 is hanging in there with a 0.4% gain.
Interestingly, the Philadelphia Semiconductor Index (-0.2%) is not participating in today's advance after the semiconductor index rallied more than 3.0% yesterday on no specific news catalysts. Cree (CREE 114.86, -5.23, -4.4%) is the weakest performer in the index.
WTI crude futures settled higher by 0.6%, or $0.30, to $53.28/bbl.
Stocks bounce back to begin the week
19-Jan-21 16:15 ET
Dow +116.26 at 30930.52, Nasdaq +198.68 at 13197.18, S&P +30.66 at 3798.91
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 gained 0.8% on Tuesday, reclaiming its decline from last Friday, in an advance led by shares of mega-cap, semiconductor, and energy companies. The Nasdaq Composite (+1.5%) and Russell 2000 (+1.3%) outperformed the benchmark index, while the Dow Jones Industrial Average (+0.4%) posted a smaller gain.
The market was pleased to hear Treasury Secretary nominee Janet Yellen asserting that it's time to "act big" on fiscal stimulus, which outweighed reports suggesting that President-elect Biden's $1.9 trillion package could run into some objections in Congress. She also said during her confirmation hearing that President-elect Biden will not repeal the 2017 tax law while the economy battles the coronavirus.
The S&P 500 energy sector (+2.1%) and Philadelphia Semiconductor Index (+3.4%), which contain economically-sensitive businesses, were among the biggest gainers today. The influential information technology sector advanced 1.3%.
In addition, positive-minded analyst recommendations in stocks like Alphabet (GOOG 1790.86, +54.67, +3.2%), Facebook (FB 261.10, +9.74, +3.9%), and American Express (AXP 126.75, +4.61, +3.8%) supported the cause. The communication services sector, which is home to GOOG and FB, increased 1.9%.
While the AXP boost was nice, the financials sector (+0.4%) was restrained by negative reactions to earnings reports from Bank of America (BAC 32.77, -0.24, -0.7%) and Goldman Sachs (GS 294.20, -6.81, -2.3%). The real estate (-0.5%), consumer staples (-0.4%), and utilities (-0.4%) sectors were the only sectors that closed lower.
U.S. Treasuries recouped overnight losses and finished little changed in front of President-elect Biden's inauguration tomorrow. The 2-yr yield was flat at 0.13%, and the 10-yr yield was flat at 1.09%. The U.S. Dollar Index decreased 0.3% to 90.50. WTI crude futures settled higher by 1.3%, or $0.66, to $52.96/bbl.
Investors did not receive any economic data during Tuesday's session. Looking ahead, investors will receive the MBA Mortgage Applications Index and the NAHB Housing Market Index for January on Wednesday.
Russell 2000 +8.9% YTD
Nasdaq Composite +2.4% YTD
S&P 500 +1.1% YTD
Dow Jones Industrial Average +1.1% YTD
Market Snapshot
Dow 30930.52 +116.26 (0.38%)
Nasdaq 13197.18 +198.68 (1.53%)
SP 500 3798.91 +30.66 (0.81%)
10-yr Note -22/32 1.094
NYSE Adv 1975 Dec 1179 Vol 1.1 bln
Nasdaq Adv 2547 Dec 1241 Vol 6.1 bln
Industry Watch
Strong: Energy, Communication Services, Information Technology
Weak: Consumer Staples, Utilities, Real Estate
Moving the Market
-- S&P 500 recoups decline from last Friday in a relatively broad-based advance
-- Treasury Secretary nominee Janet Yellen said it's time to "act big" on fiscal stimulus
-- Mixed reactions to bank earnings
-- Defensive-oriented sectors underperformed
WTI crude futures settle in positive territory
19-Jan-21 15:30 ET
Dow +132.00 at 30946.26, Nasdaq +204.02 at 13202.52, S&P +32.66 at 3800.91
[BRIEFING.COM] The S&P 500 continues to trade higher by 0.9% amid gains in eight of its 11 sectors.
Specifically, the energy (+2.4%), communication services (+2.0%), and information technology (+1.3%) sectors are in top spots today, while the real estate (-0.6%), consumer staples (-0.4%), and utilities (-0.2%) sectors are the lone holdouts.
WTI crude futures settled higher by $0.66 (+1.3%) to $52.96 per barrel.
Down Week Ends on Lower Note
15-Jan-21 16:10 ET
Dow -177.26 at 30814.26, Nasdaq -114.14 at 12998.50, S&P -27.29 at 3768.25
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The stock market ended a shaky week on a lower note. The S&P 500 fell 0.7%, giving up 1.5% for the week while the Russell 2000 (-1.5%) underperformed, but it still gained 1.5% for the week.
The market had a lot of news to digest on Friday, starting with last evening's announcement of President-elect Biden's plan for $1.90 trln in spending. The plan includes direct payments of $1,400, increased unemployment benefits, and aid for state and local governments, but some elements of the legislation will require 60 votes in the Senate so it is unclear if the current version will be approved.
Participants received a big batch of economic data that was mixed, on balance. Industrial Production beat expectations in December and inflation at the producer level remained muted. There was a slight dip in the preliminary Michigan Consumer Sentiment survey for January, but most notably, Retail Sales fell 0.7% in December (Briefing.com consensus -0.2%) while the November decrease was revised down.
The SPDR S&P Retail ETF (XRT 71.98, -1.74, -2.4%) felt the pressure of weak retail sales, though the ETF rallied to a fresh record the day before. There were a few pockets of strength within the consumer discretionary sector (-0.8%) as Home Depot (HD 275.59, +7.25, +2.7%) rallied back above its 50-day moving average (271.15) while TJX Companies (TJX 68.46, +0.44, +0.7%) reclaimed its opening loss. Homebuilders also outperformed with the iShares Dow Jones US Home Construction ETF (ITB 56.95, +0.34, +0.6%) bouncing off its 50-day moving average (56.00).
Financials (-1.8%) ended among the laggards even though JPMorgan Chase (JPM 138.64, -2.53, -1.8%) and PNC (PNC 154.78, -5.57, -3.5%) kicked off the earnings season with better than expected results. Citigroup (C 64.23, -4.78, -6.9%) and Wells Fargo (WFC 32.04, -2.71, -7.8%) also beat earnings expectations but they were a bit short of revenue estimates.
The top-weighted technology sector (-1.0%) also contributed to today's slide, widening this week's loss to 2.6%. Chipmakers pulled back after a strong start to the month, but the PHLX Semiconductor Index (-2.1%) still gained 1.9% for the week.
The energy sector (-4.0%) was today's worst performer, but it still ended the week with a 3.1% gain, which kept the group well ahead of the remaining ten sectors. Crude oil fell $1.21, or 2.3%, to $52.38/bbl, narrowing this week's gain to $0.13 or 0.3%.
Treasuries rebounded from yesterday's drop with the 10-yr note erasing its entire decline from Thursday. The benchmark yield fell three basis points to 1.10%, surrendering one basis point for the week. This left the 2s10s spread at 98 bps, unchanged for the week.
Reviewing today's economic data:
December retail sales declined 0.7% mln (Briefing.com consensus -0.2%) and November retail sales were revised down to -1.4% from -1.1%. Excluding autos, December retail sales declined 1.4% m/m (Briefing.com consensus -0.2%) and were revised down to -1.3% from -0.9% for November.
The key takeaway from the report is that it is clear consumer spending decelerated at the end of the fourth quarter, partly because of expiring benefits, weakening confidence in the short-term outlook, and restrictions on certain activities due to worsening coronavirus trends.
The Producer Price Index for final demand was up 0.3% m/m in December (Briefing.com consensus 0.4%) while the index for final demand, excluding food and energy, was up 0.1%, as expected. That left the yr/yr readings at just 0.8% and 1.2%, respectively.
The key takeaway from the report is that inflation at the producer level remains in check.
Industrial production increased 1.6% m/m in December (Briefing.com consensus 0.4%) following an upwardly revised 0.5% increase (from 0.4%) in November. The capacity utilization rate jumped to 74.5% (Briefing.com consensus 73.5%) from an upwardly revised 73.4% (from 73.3%) in November.
The key takeaway from the report is the continued strength in manufacturing output, which occurred despite a 1.6% decline in the index for motor vehicles and parts.
The preliminary January reading for the University of Michigan Index of Consumer Sentiment checked in at 79.2 (Briefing.com consensus 80.0) versus the final reading of 80.7 for December.
While there was a slight drop in consumer sentiment, the key takeaway is that it was only slight given the contentious issues related to rising coronavirus cases/deaths, the insurrection, and the impeachment of President Trump.
The Empire State Manufacturing Survey decreased to 3.5 in January (Briefing.com consensus 6.0) from 4.9 in December.
Business Inventories increased 0.5% in November (Briefing.com consensus 0.5%) after increasing a revised 0.8% (from 0.7%) in October.
The stock market will be closed on Monday in observance of Martin Luther King Jr. Day.
Russell 2000 +7.5% YTD
Nasdaq Composite +0.9% YTD
Dow Jones Industrial Average +0.7% YTD
S&P 500 +0.3% YTD
Market Snapshot
Dow 30814.26 -177.26 (-0.57%)
Nasdaq 12998.50 -114.14 (-0.87%)
SP 500 3768.25 -27.29 (-0.72%)
10-yr Note +11/32 1.097
NYSE Adv 1016 Dec 2137 Vol 1.23 bln
Nasdaq Adv 1185 Dec 2594 Vol 6.28 bln
Industry Watch
Strong: Communication Services, Real Estate, Health Care, Utilities
Weak: Energy, Industrials, Financials, Materials, Consumer Discretionary, Technology
Moving the Market
President-elect Biden announces $1.9 trln spending plan
December Retail Sales miss expectations
JPMorgan Chase (JPM) reports better than expected results to start Q4 reporting season
Crude Oil Narrows Week's Gain
15-Jan-21 15:25 ET
Dow -96.75 at 30894.71, Nasdaq -82.97 at 13029.68, S&P -17.97 at 3777.57
[BRIEFING.COM] The S&P 500 trades lower by 0.5% with 30 minutes remaining in the session. The Dow (-0.3%) hovers a bit closer to its flat line while the Nasdaq (-0.6%) underperforms.
The energy sector (-3.7%) is today's weakest performer but even with today's sharp slide, the sector remains on track to finish with a 3.5% gain for the week while the next best performer (real estate) has gained 2.0% since last Friday.
Crude oil finished today's pit session with a $1.21, or 2.3%, loss at $52.38/bbl. The energy component added $0.13, or 0.3%, for the week.
Upbeat Start Gives Way to Late Slide
14-Jan-21 16:15 ET
Dow -68.95 at 30991.46, Nasdaq -16.31 at 13112.65, S&P -14.30 at 3795.54
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The major averages finished Thursday on a modestly lower note after surrendering their opening gains. The S&P 500 fell 0.4% while the Dow (-0.2%) and Nasdaq (-0.1%) recorded slimmer losses after touching fresh intraday record highs. Small caps continued their hot start to the year as the Russell 2000 jumped 2.1%.
The trading day started with modest gains, aided by reports of $2 trillion in planned spending by the incoming administration. However, the opening push ran out of steam during the first hour of action, leaving the door open for a pullback from highs that accelerated into the close. The overall movement was limited in scope as the action unfolded in a 31-point range in the S&P 500.
Seven out of eleven sectors ended in the red with technology (-1.0%), consumer discretionary (-0.7%), and communication services (-0.8%) leading the market lower after keeping it afloat in early trade.
The underperformance among these sectors was owed to losses in the largest components by weight with names like Microsoft (MSFT 213.02, -3.32, -1.5%), Visa (V 201.86, -7.49, -3.6%), Amazon (AMZN 3127.47, -38.42, -1.2%), and Alphabet (GOOG 1740.18, -14.22, -0.8%) finding resistance near their respective 50-day moving averages.
Technology's underperformance overshadowed another strong showing from chipmakers. Taiwan Semiconductor Manufacturing Company (TSM 126.45, +7.22, +6.1%), which is the world's largest contract chip foundry, reported strong results, issued upbeat guidance, and announced big spending plans, boding well for other names in the PHLX Semiconductor Index (+2.1%).
The afternoon pressure on the market's heavyweights intensified after Fed Chairman Powell reiterated during a speech that a rate hike will not be considered for a long time. However, the selling did not have a meaningful impact on financials (+0.5%), or sectors that would benefit from commodity inflation like energy (+3.0%) and industrials (+0.3%). The energy sector extended this week's gain to 7.5% largely due to continued support from its largest component—Exxon Mobil (XOM 50.31, +1.89, +3.9%)—after the stock was upgraded to Overweight from Equal Weight with a $56 target at Barclays. Crude oil, meanwhile, rallied $0.67, or 1.3%, to $53.59/bbl.
Bank stocks benefited from more curve steepening, as the 2s30s spread expanded by three basis points to 171 bps while the 2s10s spread expanded by two basis points to 97 bps. Citigroup (C 69.01, +2.15, +3.2%) and Wells Fargo (WFC 34.75, +0.95, +2.8%) hit their best levels in ten months while JPMorgan Chase (JPM 141.17, +0.82, +0.6%) touched a fresh record high ahead of tomorrow's release of their Q4 results.
Treasuries finished on their lows, sending the 10-yr yield higher by four basis points to 1.13%.
Economic data released today was limited to jobless claims and import/export prices:
For the week ending January 9, initial claims spiked by 181,000 to 965,000 (Briefing.com consensus 780,000). That's the highest claims number since August. Continuing claims for the week ending January 2 increased by 199,000 to 5.271 million.
The key takeaway from the report for the market is that it simply paints the need for additional stimulus; hence, this bad news gets interpreted as good news.
Import prices rose 0.9% in December while the November increase was revised up to 0.2% from 0.1%. Excluding oil, import prices rose 0.4% after decreasing a revised 0.2% (from -0.3%) in November. Export prices rose 1.1% in December while the November increase was revised up to 0.7% from 0.6%. Excluding agriculture, export prices rose 1.3% after increasing 0.3% in November.
December PPI (Briefing.com consensus 0.4%; prior 0.1%), Core PPI (Briefing.com consensus 0.1%; prior 0.1%), December Retail Sales (Briefing.com consensus -0.2%; prior -1.1%), Retail Sales ex-auto (Briefing.com consensus -0.2%; prior -0.9%), November Business Inventories (Briefing.com consensus 0.5%; prior 0.7%), and January Empire State Manufacturing (Briefing.com consensus 6.0; prior 4.9) will be reported tomorrow at 8:30 ET, followed by December Industrial Production (Briefing.com consensus 0.4%; prior 0.4%) and Capacity Utilization (Briefing.com consensus 73.5%; prior 73.3%) at 9:15 ET and the preliminary Michigan Consumer Sentiment Survey for January (Briefing.com consensus 80.0; prior 80.7) at 10:00 ET.
Russell 2000 +9.1% YTD
Nasdaq Composite +1.7% YTD
Dow Jones Industrial Average +1.3% YTD
S&P 500 +1.1% YTD
Market Snapshot
Dow 30991.46 -68.95 (-0.22%)
Nasdaq 13112.65 -16.31 (-0.12%)
SP 500 3795.54 -14.30 (-0.38%)
10-yr Note -7/32 1.129
NYSE Adv 2182 Dec 958 Vol 1.04 bln
Nasdaq Adv 2687 Dec 1073 Vol 6.60 bln
Industry Watch
Strong: Energy, Industrials, Financials, Real Estate
Weak: Utilities, Consumer Staples, Technology, Consumer Discretionary, Communication Services
Moving the Market
Biden administration will reportedly seek $2 trln in fiscal spending
Initial claims reach highest level since late August
Tech Sector Leads Stocks Higher
13-Jan-21 16:10 ET
Dow -8.22 at 31060.41, Nasdaq +56.52 at 13128.96, S&P +8.65 at 3809.84
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The stock market finished Wednesday on a slightly higher note. The Nasdaq (+0.4%) outperformed throughout the day while the S&P 500 (+0.2%) and Dow (unch) finished closer to their flat lines. The Russell 2000 (-0.8%) underperformed after a strong start to the week.
Equities recorded the bulk of their gains in morning trade while afternoon action saw some backtracking from highs. The modest advance unfolded in quiet fashion as gains among influential sectors like technology (+0.7%), health care (+0.3%), and consumer discretionary (+0.2%) outweighed losses in financials (-0.2%) and industrials (-0.9%).
Smaller sectors ended at the extremes of the performance table as utilities (+1.9%) and real estate (+1.4%) claimed the top two spots while materials (-1.1%) and energy (-0.8%) finished at the bottom.
The technology sector received an early boost from Intel (INTC 56.95, +3.71, +7.0%) after the company announced that its CEO will be replaced by VMWare's (VMW 133.20, -9.71, -6.8%) current CEO in February. Intel's strength did not invite significant buying interest in other chipmakers, as nearly two thirds of the names in the PHLX Semiconductor Index (+0.1%) finished in the red.
The consumer discretionary sector (+0.2%) also contributed to today's advance, but that was largely thanks to a strong gain in Amazon (AMZN 3165.89, +45.06, +1.4%), which reclaimed its 50-day moving average. Homebuilders received an early boost from a better than expected quarterly report from KB Home (KBH 35.01, +0.86, +2.5%), but the stock surrendered the bulk of its gain as the day went on while the iShares U.S. Home Construction ETF (ITB 56.50, -0.19, -0.3%) finished with a modest loss after backing down from a two-week high.
On the downside, the energy sector (-0.8%) narrowed this week's gain to 4.3% while crude oil slipped $0.28, or 0.5%, to $52.92/bbl after reaching a fresh 11-month high. Exxon Mobil (XOM 48.42, +0.54, +1.1%) outperformed within the energy sector, climbing in response to an upgrade to Overweight from Neutral with a $56 target at JP Morgan.
In Washington, the House of Representatives began voting on the impeachment of President Trump as the Wall Street session drew to its close.
Treasuries rebounded after six days of losses in longer tenors, sending the 10-yr yield down five basis points to 1.09%. The U.S. Dollar Index rose 0.3% to 90.36.
Reviewing today's economic data:
Total CPI increased 0.4% m/m in December (Briefing.com consensus 0.4%) while core CPI increased 0.1% m/m (Briefing.com consensus 0.1%). The uptick in total CPI was driven largely by an 8.4% increase in the gasoline index, which accounted for more than 60% of the overall increase.
The key takeaway from the report is that it won't trigger inflation alarm bells in an aggregate sense. Total CPI is up just 1.4% yr/yr, versus 1.2% in November, while core CPI held steady at 1.2% yr/yr for the third straight month. The latter views notwithstanding, inflation worries -- both real and imagined -- promise to be a pressing issue throughout the year.
The December Treasury Budget showed a $143.6 bln deficit, versus a $13.3 bln deficit in the same period a year ago. The budget data is not seasonally adjusted, so the December deficit can't be compared to the November deficit of -$145.3 bln.
Total receipts of $346.1 bln were $10.3 bln more than the same period last year. Individual income taxes were the largest source of receipts at $144 bln.
The weekly MBA Mortgage Index jumped 16.7% as the Refinance Index spiked 20.1% while the Purchase Index rose 8.0%.
Weekly Initial Claims (Briefing.com consensus 780,000; prior 787,000), Continuing Claims (prior 5.072 mln), December Import Prices (prior 0.1%), Export Prices (prior 0.6%), Import Prices ex-oil (prior -0.3%), and Export Prices ex-agriculture (prior 0.3%) will be reported tomorrow at 8:30 ET.
Russell 2000 +6.9% YTD
Nasdaq Composite +1.9% YTD
Dow Jones Industrial Average +1.5% YTD
S&P 500 +1.4% YTD
Market Snapshot
Dow 31060.41 -8.22 (-0.03%)
Nasdaq 13128.96 +56.52 (0.43%)
SP 500 3809.84 +8.65 (0.23%)
10-yr Note +11/32 1.088
NYSE Adv 1661 Dec 1477 Vol 944.7 mln
Nasdaq Adv 1698 Dec 2036 Vol 6.96 bln
Industry Watch
Strong: Real Estate, Utilities, Technology, Consumer Staples, Consumer Discretionary, Health Care
Weak: Energy, Financials, Industrials, Materials
Moving the Market
Intel (INTC) spikes after CEO announces his departure
House of Representatives expected to vote on impeaching President Trump today
December CPI matches expectations
Crude Oil Dips
13-Jan-21 15:30 ET
Dow +2.72 at 31071.35, Nasdaq +62.18 at 13134.62, S&P +10.28 at 3811.47
[BRIEFING.COM] The S&P 500 trades higher by 0.3% with 30 minutes remaining in the trading day.
The benchmark index has backed down from its session high in recent action, but it remains on track to finish with the bulk of today's gain. Given its current level, the index is on course to end 12 points below its record high from Friday.
In commodities, crude oil finished the pit session down $0.28, or 0.5%, at $52.92/bbl after backing down from a fresh 11-month high. The energy sector, meanwhile, is down 0.8%.
Treasuries finished the day just below their highs with the 10-yr yield falling five basis points to 1.09%.
No quit in the recovery trade, Russell 2000 closes at record high
12-Jan-21 16:15 ET
Dow +60.00 at 31068.63, Nasdaq +36.00 at 13072.44, S&P +1.58 at 3801.19
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 finished little changed on Tuesday, as gains in cyclical stocks helped offset losses in growth stocks and health care names. The Russell 2000 (+1.7%) extended its hot start to the year and closed at a fresh record high, while the Dow Jones Industrial Average (+0.2%) and Nasdaq Composite (+0.3%) posted smaller gains.
Investors remained committed to the so-called recovery trade, which meant that small-caps, cyclical stocks, oil prices ($53.20/bbl, +1.01, +1.9%), and longer-dated Treasury yields were up on expectations for improved economic growth. Hopes that the vaccine rollout in the U.S. could soon speed up was cited as a positive factor.
The energy sector (+3.5%) set the winning pace with a 3.5% gain in a continuation of its recent outperformance. The materials (+1.4%), consumer discretionary (+1.3%), financials (+1.1%), and industrials (+1.0%) sectors advanced at least 1.0%. In addition, advancing issues outpaced declining issues by healthy margins at the NYSE and Nasdaq.
The downside was that growth stocks were pressured by the continued rise in long-term interest rates since their high valuations have been largely supported by extremely low rates. The 10-yr yield peaked at 1.18% amid increased selling interest, but it finished one basis point higher at 1.14% after a $38 billion 10-yr note government auction was met with strong demand.
The S&P 500 information technology sector (-0.4%), which is home to many growth stocks, pared losses as Treasury yields started to come off session highs. The communication services (-1.5%) and health care (-1.1%) sectors closed near session lows.
Separately, the financial and energy sectors received additional support from positive-minded analyst recommendations in stocks like Wells Fargo (WFC 33.94, +0.70, +2.1%), Charles Schwab (SCHW 61.20, +0.95, +1.6%), Chevron (CVX 93.34, +1.74, +1.9%), and Occidental Petroleum (OXY 22.62, +2.54, +12.7%).
The 2-yr yield decreased one basis point to 0.14%. The U.S. Dollar Index fell 0.5% to 90.04 amid relative strength in the euro and British pound.
Reviewing Tuesday's economic data:
Job openings decreased slightly to 6.527 million in November from 6.652 million in October.
The NFIB Small Business Optimism Index decreased to 95.9 in December from 101.4 in November.
Looking ahead, investors will receive the Consumer Price Index for December, the Treasury Budget for December, the Fed's Beige Book for January, and the weekly MBA Mortgage Applications Index on Wednesday.
Russell 2000 +7.8% YTD
Dow Jones Industrial Average +1.5% YTD
Nasdaq Composite +1.4% YTD
S&P 500 +1.2% YTD
Market Snapshot
Dow 31068.63 +60.00 (0.19%)
Nasdaq 13072.44 +36.00 (0.28%)
SP 500 3801.19 +1.58 (0.04%)
10-yr Note 0/32 1.141
NYSE Adv 2086 Dec 1051 Vol 1.1 bln
Nasdaq Adv 2586 Dec 1167 Vol 7.0 bln
Industry Watch
Strong: Energy, Consumer Discretionary, Financials, Industrials
Weak: Utilities, Health Care, Communication Services, Information Technology
Moving the Market
-- Russell 2000 outperforms while large-cap indices trade little changed
-- Strength in energy and financial stocks
-- Longer-dated Treasury yields continue to rise
Higher oil prices fuel energy stocks
12-Jan-21 15:25 ET
Dow +67.95 at 31076.58, Nasdaq +31.61 at 13068.05, S&P +1.49 at 3801.10
[BRIEFING.COM] The S&P 500 is trading higher by 0.1% at around the 3800 level. It was down as much as 0.6% earlier today.
One last look at the sector performances shows energy (+3.3%), consumer discretionary (+1.6%), materials (+1.5%), and financials (+1.0%) in the lead, while the health care (-1.0%) and communication services (-1.0%) sectors are both down 1.0%.
WTI crude futures settled higher by 1.9%, or $1.01, to $53.20/bbl.
Negative start to the week as profit-taking hits tech stocks
11-Jan-21 16:15 ET
Dow -89.28 at 31008.63, Nasdaq -165.54 at 13036.44, S&P -25.07 at 3799.61
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 declined 0.7% on Monday in a tech-driven decline that was more pronounced in the Nasdaq Composite (-1.3%). The Dow Jones Industrial Average (-0.3%) and Russell 2000 (-0.03%) finished closer to their flat lines amid relative strength in health care and cyclical stocks.
Technology stocks succumbed to profit-taking interest amid a continued rise in interest rates and renewed regulatory concerns after a host of companies like Facebook (FB 256.84, -10.73, -4.0%) and Twitter (TWTR 48.18, -3.30, -6.4%) restricted President Trump's online influence over the weekend.
Accordingly, the communication services (-1.8%), consumer discretionary (-1.9%), and information technology (-0.9%) sectors joined the rate-sensitive real estate (-1.7%) and utilities (-0.9%) sectors at the bottom of the standings. Tesla (TSLA 811.19, -68.83, -7.8%) shares pulled back 8% despite BoA Securities raising its price target on the stock to a Street-high $900 from $500.
Outside these groups, investors continued to put faith in an economic recovery, evident by the outperformances of the cyclical energy (+1.6%), financials (+0.4%), and materials (unch) sectors. The Philadelphia Semiconductor Index advanced 1.1%.
The health care sector (+0.5%) also finished higher amid a litany of upbeat guidance issued out of the JPMorgan Health Care Conference and strength in Eli Lilly (LLY 185.94, +19.53, +11.7%) following positive Phase 2 clinical results for treating Alzheimer's disease.
Exxon Mobil (XOM 46.84, +1.38, +3.0%) powered the energy space after Morgan Stanley upgraded the stock to Overweight from Equal Weight. Walgreens Boots Alliance (WBA 47.70, +2.49, +5.5%), meanwhile, was upgraded to the equivalent of a Buy rating at Guggenheim and Robert W. Baird.
U.S. Treasuries extended last week's retreat, driving yields higher across the curve, amid lingering expectations for more fiscal stimulus. The 2-yr yield increased two basis points to 0.15%, and the 10-yr yield increased three basis points to 1.13%. The U.S. Dollar Index increased 0.5% to 90.51. WTI crude futures declined 0.1% to $52.19/bbl.
Investors did not receive any economic data on Monday. Looking ahead to Tuesday, investors will receive the Consumer Price Index for December, the Treasury Budget for December, the Fed's Beige Book for January, and the weekly MBA Mortgage Applications Index.
Russell 2000 +5.9% YTD
Dow Jones Industrial Average +1.3% YTD
Nasdaq Composite +1.2% YTD
S&P 500 +1.2% YTD
Market Snapshot
Dow 31008.63 -89.28 (-0.29%)
Nasdaq 13036.44 -165.54 (-1.25%)
SP 500 3799.61 -25.07 (-0.66%)
10-yr Note -1/32 1.134
NYSE Adv 1238 Dec 1883 Vol 962.0 mln
Nasdaq Adv 1712 Dec 2046 Vol 6.8 bln
Industry Watch
Strong: Health Care, Energy, Financials, Materials
Weak: Information Technology, Communication Services, Consumer Discretionary, Real Estate
Moving the Market
-- Technology stocks hit by profit-taking interest and higher interest rates
-- Health care and cyclical stocks outperformed
-- Political headwinds
Crude futures settle little changed
11-Jan-21 15:25 ET
Dow -98.16 at 30999.75, Nasdaq -182.48 at 13019.50, S&P -28.58 at 3796.10
[BRIEFING.COM] The S&P 500 is down 0.7% while the Russell 2000 is down 0.1%.
One last look at the S&P sectors shows communication services (-1.9%), consumer discretionary (-1.9%), real estate (-1.7%), information technology (-1.0%), and utilities (-1.0%) leading the broader decline, while the energy (+1.5%), health care (+0.4%), and financials (+0.3%) sectors still trade higher.
WTI crude futures settled lower by 0.1%, or $0.06, to $52.19/bbl.
Market looks past December job losses in record-setting advance
08-Jan-21 16:15 ET
Dow +56.84 at 31097.91, Nasdaq +134.50 at 13201.98, S&P +20.89 at 3824.68
https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 (+0.6%), Nasdaq Composite (+1.0%), and Dow Jones Industrial Average (+0.2%) closed at fresh record highs on Friday despite a weak December employment report. The Russell 2000 (-0.3%) set an intraday all-time high at the open but closed lower.
Briefly, December nonfarm payrolls decreased by 140,000 (Briefing.com consensus +112,000), private sector payrolls decreased by 95,000 (Briefing.com consensus +100,000), and the unemployment rate was unchanged at 6.7%, as expected. The unexpected decline in payrolls was partially offset by large upward revisions to November payrolls.
The market presumably interpreted the report as a blip in the labor market recovery due to ongoing vaccination efforts and less consequential to the economic growth outlook due to prospects for more fiscal stimulus. It was also backwards-looking based on the renewed lockdown measures enacted to curb the spread of the coronavirus.
In the stock market, the S&P 500 consumer discretionary (+1.8%), real estate (+1.1%), information technology (+0.8%), and utilities (+0.9%) sectors carried the market higher, with Tesla (TSLA 880.02, +63.98, +7.8%) disproportionately aiding the consumer discretionary sector and Nasdaq.
On the downside, the materials (-0.5%), financials (-0.2%), industrials (-0.2%), and energy (-0.1%) sectors finished in the red. Micron (MU 77.42, -1.69, -2.1%) shares gave up an early 6% gain and closed lower despite reporting positive earnings results and upbeat guidance.
Separately, the S&P 500 briefly turned negative on reports that Senator Joe Manchin (D-WV) said he will not support $2000 stimulus checks, but Mr. Manchin quickly clarified that "if the next round of stimulus checks goes out, they should be targeted to those who need it." Stocks recovered.
President-elect Biden said he will propose a complete economic package next week that will include a range of issues and said the "price tag will be high."
Longer-dated Treasuries continued to face selling pressure amid expectations for economic growth and possibly inflation. The 10-yr yield increased another three basis points to 1.11%, while the 2-yr yield decreased one basis point to 0.13%. The U.S. Dollar Index increased 0.3% to 90.06. WTI crude futures increased 2.8%, or $1.44, to $52.25/bbl.
Reviewing Friday's economic data:
The December employment report disappointed on the headline level as nonfarm payrolls declined by 140,000 (Briefing.com consensus 112,000) against expectations for an increase. However, the drop was partially offset by a large upward revision to November figures and an increase in December average hourly earnings. December private sector payrolls decreased by 95,000 (Briefing.com consensus 100,000). December unemployment rate was unchanged at 6.7% (Briefing.com consensus 6.7%)
Capital markets are likely to look past this report and focus on the expected increase in fiscal spending once a new administration is inaugurated, but the December report shows that the labor market is facing an uphill climb.
Consumer credit increased by $15.3 bln in November after increasing a revised $4.5 bln (from $7.2 bln) in October.
The key takeaway from the report is that revolving credit decreased for the eighth time over the last nine months dating back to February, which preceded the initial pandemic lockdown period taking hold in the U.S.
Wholesale inventories were unchanged in November (Briefing.com consensus -0.1%) following an upwardly revised 1.3% increase (from +1.1%) in October.
Investors will not receive any notable economic data on Monday.
Russell 2000 +5.9% YTD
Nasdaq Composite +2.4% YTD
S&P 500 +1.8% YTD
Dow Jones Industrial Average +1.6% YTD
Market Snapshot
Dow 31097.91 +56.84 (0.18%)
Nasdaq 13201.98 +134.50 (1.03%)
SP 500 3824.68 +20.89 (0.55%)
10-yr Note -25/32 1.118
NYSE Adv 1604 Dec 1470 Vol 1.0 bln
Nasdaq Adv 1936 Dec 1784 Vol 7.1 bln
Industry Watch
Strong: Consumer Discretionary, Real Estate, Information Technology, Utilities
Weak: Financials, Materials, Industrials, Energy
Moving the Market
-- S&P 500, Nasdaq, and Dow close at fresh record highs
-- December employment report showed unexpected decline in payrolls
-- Lingering hopes for additional fiscal stimulus
Crude futures settle above $52 per barrel
08-Jan-21 15:30 ET
Dow +9.77 at 31050.84, Nasdaq +94.49 at 13161.97, S&P +13.28 at 3817.07
[BRIEFING.COM] The S&P 500 is trading higher by 0.3%, while the Russell 2000 is trading lower by 0.4%.
One last look at the S&P 500 sectors shows mixed results. Consumer discretionary (+1.2%), real estate (+1.0%), and utilities (+0.7%) are in the leadership positions, while the materials (-0.9%), industrials (-0.5%), and financials (-0.4%) sectors lag in negative territory.
WTI crude futures settled higher by 2.8%, or $1.44, to $52.25/bbl.