From Briefing.com: 4:28 pm Closing Market Summary: Averages Escape Thursday Unscathed (:WRAPX) :
Investors had a slew of headlines to digest on Thursday as former FBI Director James Comey testified in front of the Senate Intelligence Committee, the European Central Bank announced its latest policy decision, and the Brits headed to the ballot box. However, in the end, the major averages were able to escape unscathed with the S&P 500 (unch) and the Dow (unch) finishing just a tick above their flat lines. The Nasdaq (+0.4%) outperformed its peers while the Russell 2000 did even better, adding 1.4%.
One of the big potential stumbling blocks for the stock market going into Mr. Comey's testimony was the February 14 meeting between Mr. Comey and President Trump. In this meeting, Mr. Trump allegedly told Mr. Comey that he hoped the FBI could let go of the investigation of former National Security Advisor Michael Flynn. When asked if he thought President Trump was trying to obstruct justice with said remark, Mr. Comey answered that it wasn't for him to say and that he would let others make that determination.
The rest of Mr. Comey's testimony didn't necessarily paint the president in a flattering light, but it didn't do anything to build a case for criminal charges against Mr. Trump either. The stock market advanced to a fresh session high near the end of the hearing with the heavily-weighted financial sector (+1.1%) leading the charge.
Financials underpinned the broader market from start to finish, further cementing its spot at the top of the weekly leaderboard. The sector's strength was broad-based with banks, insurers, asset managers, and consumer finance companies settling higher across the board.
A steepening of the yield curve helped the financial group in its positive performance, as did a pending House vote to repeal Dodd-Frank regulations. Longer-dated Treasuries slipped a bit, leaving the 10-yr yield two basis points higher at 2.19%, while shorter-dated issues settled flat with the 2-yr yield unchanged at 1.31%.
The top-weighted technology sector (+0.4%) also helped keep the broader market afloat thanks in large part to chipmakers, which pushed the PHLX Semiconductor Index higher by 1.8%. NVIDIA (NVDA 159.94, +10.82) led the semiconductor advance, jumping 7.3%, after its target price was raised to $180 from $145 at Citigroup.
Two other sectors--industrials (+0.3%) and materials (+0.3%)--also finished in positive territory, but the remaining groups settled with losses between 0.2% and 0.9%. The influential health care group finished lower by 0.2% despite a solid performance from the biotechnology industry; the iShares Nasdaq Biotechnology ETF (IBB 294.75, +1.77) added 0.6%.
In Europe, the ECB decided to leave interest rates unchanged, as expected, however, the central bank did drop language from its policy statement that suggested rates could be cut further. In addition, ECB President Mario Draghi acknowledged that risks to the outlook are now broadly balanced, but noted that inflation remains low and has yet to show a convincing pickup. The euro (1.1216) ticked down a bit following the news, but quickly recovered thereafter, settling 0.4% lower against the U.S. dollar.
Meanwhile, the pound (1.2945) shed 0.1% against the greenback ahead of the UK election results. The Conservatives are expected to come away victorious, but polls conducted in recent weeks suggested a narrower margin of victory than previously expected.
On the data front, investors received only one economic report--Initial Claims--on Thursday:
The latest weekly initial jobless claims count totaled 245,000 while the Briefing.com consensus expected a reading of 240,000. Today's tally was below the revised prior week count of 255,000 (from 248,000). As for continuing claims, they declined to 1.917 million from the revised count of 1.919 million (from 1.915 million).
The key takeaway from the report is that the level of initial claims remains consistent with a tight labor market.
Economic data will be light once again tomorrow with April Wholesale Inventories (Briefing.com consensus -0.1%) being the only item on the docket. The report will cross the wires at 10:00 ET.
Nasdaq Composite +17.4% YTD
S&P 500 +8.7% YTD
Dow Jones Industrial Average +7.2% YTD
Russell 2000 +4.3% YTD
Tech Stocks from Briefing.com
Both the Dow and the Nasdaq notched new all-time highs today following testimony from former FBI Director James Comey in front of the Senate Intelligence Committee. That being said, the Nasdaq Composite performed the best today by adding 24.38 points (+0.39%) on its way to 6321.76. The Dow Jones Industrial Average gained 8.84 points (+0.04%) to 21182.53, while the S&P 500 was up less than a point (+0.03%) when the bell rang to end 2433.79.
The Technology (XLK 57.44, +0.13 +0.23%) space finished higher, albeit in a 'worst-of-the-best' scenario among other S&P sectors. Component Yahoo! (YHOO 55.71, +5.16 +10.21%) jumped out of the gate and never looked back; shares were stronger today in sympathy to Alibaba's (BABA 142.34, +16.70 +13.29%) guidance from its investor day. Financials XLF +1.15% were the best performing sector today in the S&P, followed by XLB +0.33%, XLI +0.33%, IYZ +0.30%, XLV -0.27%, XLE -0.29%, XLRE -0.47%, XLY -0.65%, XLP -0.75%, XLU -0.83%.
In the S&P 500 Information Technology (984.72, +3.48 +0.35%) space, trading finished near highs. Component NVIDIA (NVDA 159.95, +10.83 +7.26%) was higher today on general strength in semiconductors in addition to a target raise of the stock at Citigroup. Other names in the space which outperformed today included FSLR +2.33%, FFIV +2.23%, ADI +2.07%, STX +1.98%, NTAP +1.88%, TXN +1.75%, LRCX +1.65%, ADS +1.58%, SWKS +1.40%, WDC +1.21%, CSRA +1.06%, FB +1.04%.
Other notable news items among sector components:
Pandora Media (P 8.42, -0.06 -0.71%) and KKR (KKR 18.64, +0.10 +0.54%) agreed to a brief extension of the pre-closing period and Pandora's termination right; will allow Pandora to explore interest expressed by a strategic investor in making a substantial minority investment.
GrubHub (GRUB 43.81, -0.07 -0.16%) to acquire Foodler; terms not disclosed.
Microsoft (MSFT 71.94, -0.44 -0.61%) acquired Hexadite for a reported $100 million.
DragonWave (DRWI 1.17, +0.06 +5.41%) confirmed was notified that the Nasdaq Hearings Panel granted the Company's request for continued listing on Nasdaq.
Intel (INTC 36.48, +0.22 +0.61%) CFO, Robert Swan, disclosed purchase of 13,888 shares worth more than $500K pursuant to Rule 10b5-1.
Alibaba (BABA) gave FY18 revenue growth guidance of 45-49% at its Investor Day.
Sprint (S 8.60, -0.04 -0.46%) and TIDAL announced a partnership where Sprint customers receive an all-access pass to TIDAL; Beginning June 9, new and existing customers can get six months of TIDAL HiFi for no charge.
In reaction to quarterly results:
Comtech Telecom (CMTL 17.79, +2.79 +18.60%) reported Q3 EPS of $0.13 on worse than expected revenues of $127.8 million. The company also guided FY17 EPS of $0.33 on revenues of $550.0-555.0 million from $570-580 million.
Okta (OKTA 27.15, +1.46 +5.68%) reported a better than expected Q1 loss of $0.50 per share on better than expected revenues of $53 million. The company also guided Q2 EPS of ($0.26)-($0.25) and revenues of $55-56 million. For FY18, the company sees EPS and revenues ahead of market expectations at ($1.15)-($1.11) and $233-236 million, respectively.
Verint Systems (VRNT 43.45, +1.35 +3.21%) reported better than expected Q1 EPS and revenues of $0.49 and $265.7 million, respectively. For FY18, VRNT sees EPS and revenues in-line at $2.70 and $1.14 billion, plus or minus 2%.
Companies scheduled to report quarterly results tonight: DTRM, PAY, XTLY
Analyst actions:
ORCL was upgraded to Positive from Mixed at OTR Global;
CTSH was downgraded to Hold from Buy at HSBC;
ERIC was initiated with a Buy at Citigroup,
NOK was initiated with a Neutral at Citigroup,
MULE was initiated with a Perform at Oppenheimer,
TMUS was initiated with a Buy at Drexel Hamilton,
KN was initiated with a Buy at Dougherty
