From Briefing.com: 4:20 pm Closing Market Summary: Stocks Fail To Reach Green Territory in Afternoon Rally (:WRAPX) :
An afternoon rally erased much of the stock market's morning loss, but it just wasn't enough to bring the major averages all the way back to their unchanged marks. The S&P 500 opened the second quarter of 2017 with a modest loss of 0.2% while the Nasdaq and the Dow settled lower by 0.3% and 0.1%, respectively. Meanwhile, the small-cap Russell 2000 (-1.2%) underperformed.
Stocks held close to their flat lines at the opening bell, but it didn't take long for the financial sector (-0.3%) to disrupt the equilibrium. Action within the Treasury market prompted the sector's retreat as unequally distributed buying left longer-dated issues notably higher than their shorter-dated peers. However, the yield curve balanced out a bit in the afternoon, allowing the financial group, and the broader market, to come up from its worst level of the day. The 10-yr yield (2.35%) finished four basis points lower while the 2-yr yield (1.24%) gave up only two basis points.
The remaining cyclical groups settled with modest losses. The consumer discretionary space (-0.5%) closed at the bottom of the day's leaderboard following the largely disappointing auto sales figures for the month of March. Large-cap names like Ford Motor (F 11.44, -0.20), General Motors (GM 34.17, -1.19), Fiat Chrysler (FCAU 10.41, -0.52), Toyota Motor (TM 108.52, -0.10), and Honda Motor (HMC 30.13, -0.13) finished with losses between 0.1% (Toyota) and 4.8% (Fiat Chrysler). Used-car retailer CarMax (KMX 56.67, -2.55) also struggled, dropping 4.3%, to settle as one of the worst-performing SPDR S&P Retail ETF (XRT 41.60, -0.64) components. The XRT finished lower by 1.5%.
However, the auto sales results weren't all bad as electric automaker Tesla (TSLA 298.52, +20.22) jumped 7.3% after reporting a 69.0% year-over-year increase in first quarter deliveries. TSLA shares settled at a fresh all-time high as the company surpassed Ford in market capitalization to become the second biggest automaker in the U.S.
On the countercyclical side, defensive groups generally finished ahead of the broader market as investors gave preference to the less-risky equities. The health care sector (+0.1%) finished with the telecom services space (+0.4%) atop the day's leaderboard as managed health care names like UnitedHealth (UNH 165.59, +1.58), Aetna (AET 128.74, +1.19), and Anthem (ANTM 166.49, +1.11) provided a pocket of strength.
On the data front, investors received the March ISM Index and February Construction Spending:
The ISM Index for March declined to 57.2 from an unrevised reading of 57.7 in February while the Briefing.com consensus expected a downtick to 57.0.
The key takeaway from the report is that all 18 industries reported growth in new orders for the month of March.
The key takeaway from the report is that all 18 industries reported growth in new orders for the month of March.
The Construction Spending report for February showed an increase of 0.8% while the Briefing.com consensus expected an increase of 1.0%. The prior month's reading was revised to -0.4% from -1.0%.
The key takeaway from the report is that increases were seen in both private construction spending (+0.8%) and public construction spending (+0.6%).
The key takeaway from the report is that increases were seen in both private construction spending (+0.8%) and public construction spending (+0.6%).
Tomorrow, February Trade Balance (Briefing.com consensus -$44.7 billion) and February Factory Orders (Briefing.com consensus 0.9%) will cross the wires at 8:30 ET and 10:00 ET, respectively.
Nasdaq Composite +9.5% YTD
S&P 500 +5.4% YTD
Dow Jones Industrial Average +4.5% YTD
Russell 2000 +0.9% YTD
The broader market closed out the first session of April, and Q2, with modest losses. Action began Monday in the green, but quickly turned lower as sellers took the markets to near three-day lows before midday. A steady recovery would see the three major averages reclaim a portion of the morning fall, but ultimately all three ended in the red. Leading the lower action, the Nasdaq Composite declined 17.06 points (-0.29%) to 5894.68. The S&P 500 was down 3.88 points (-0.16%) to 2358.84, while the Dow Jones Industrial Average lost about 13.01 points (-0.06%) to 20650.21.
Today's economic data included the ISM Index for March which declined to 57.2 from an unrevised reading of 57.7 in February. Additionally, the Construction Spending report for February showed an increase of 0.8%, while the prior month's reading was revised to -0.4% from -1.0%.
The Technology (XLK 53.26, -0.05 -0.09%) space closed out Monday with slight losses, failing to break out several times in the final moments. Components FTR -4.21% CSRA -3.43% WU -2.85% FSLR -2.84% AKAM -2.68% CTSH -2.13% TDC -2.12% FLIR -1.87% were pressured today. In the S&P, only the Real Estate XLRE +0.13% and the Healthcare spaces XLV +0.08% managed to escape Monday with gains, followed by XLU -0.02% XLP -0.16% XLE -0.17% XLF -0.21% XLI -0.22% XLB -0.38% XLY -0.40% IYZ -0.59%.
In the S&P 500 Information Technology (904.89, -1.32 -0.15%) space, trading also closed the first session of Q2 lower. Component Accenture (ACN 117.64, -2.24 -1.87%) was one of the worst performing names; news was out that the company acquired Genfour for an undisclosed sum. Other names in the space which closed lower today included GPN -1.67%, HPQ -1.62%, MSI -1.61%, QCOM -1.46%, SYMC -1.43%, STX -1.37%, ADSK -1.25%, APH -1.24%, XLNX -1.23%.
Other notable news items among sector components:
DXC Technology (DXC 67.95, -1.25 -1.81%) has been formed following completion of the merger between CSC (CSC 69.01, -2.14 -3.01%) and the Enterprise Services Division of Hewlett Packard Enterprise (HPE 17.57, -0.19 -1.07%).
Apple (AAPL 143.70, +0.04 +0.03%) said to have ordered 70 million OLED panels from Samsung (SSNLF 1500.00, flat) for the iPhone 8, according to the Nikkei Asian Review.
Accenture (ACN) acquired Genfour. Financial terms of the deal were not disclosed.
Sierra Wireless (SWIR 26.30, -0.25 -0.94%) acquired substantially all of the assets of GlobalTop Technology's Global Navigation Satellite System embedded module business for total cash consideration of approx. $3.2 million.
FactSet (FDS 164.22, -0.69 -0.42%) completed its acquisition of the Interactive Data Managed Solutions business from Intercontinental Exchange (ICE 59.32, -0.55 -0.92%), updates Q3 outlook.
Analyst actions:
BBRY was upgraded to Outperform from Neutral at Macquarie,
ELLI was upgraded to Outperform from Market Perform at William Blair;
ANET was downgraded to Hold from Buy at Stifel,
ACN was downgraded to Sell from Neutral at Goldman,
PCLN was downgraded to Neutral at MoffettNathanson,
NTRI was downgraded to Neutral from Buy at Sidoti;
SNAP was initiated with a Hold at Argus,
CGNX was initiated with a Buy at Goldman,
PSDO was initiated with an Outperform at Evercore ISI,
IPAS was initiated with a Buy at Ladenburg Thalmann,
AUXO was initiated with a Buy at Craig Hallum
