Sector Investing

[ReturntoSender]

Reversing Course
27-Mar-18 16:30 ET
Dow -344.89 at 23857.71, Nasdaq -211.73 at 7008.81, S&P -45.93 at 2612.62

https://www.briefing.com/investor/markets/stock-market-update/2018/3/27/reversing-course.htm

[BRIEFING.COM] Equities tried to extend Monday's rebound at the start of Tuesday's session, but ended up giving back the bulk of Monday's gains instead. Technology shares led the retreat, pushing the tech-heavy Nasdaq lower by 2.9%. The S&P 500 and the Dow finished with losses of 1.7% and 1.4%, respectively.

FAANG names -- Facebook (FB 152.19, -7.87), Amazon (AMZN 1497.05, -58.81), Apple (AAPL 168.34, -4.43), Netflix (NFLX 300.69, -19.66), and Alphabet (GOOG 1005.10, -48.11) -- dropped between 2.6% and 6.1% on Tuesday, while market darling NVIDIA (NVDA 225.52, -18.96) tumbled 7.8% after announcing that it has temporarily suspended autonomous driving tests in order to learn more about last week's fatal Uber crash. Tesla (TSLA 279.18, -25.00), which is a leader in autonomous driving technology, dropped 8.2%, and Twitter (TWTR 28.07, -3.84) tumbled 12.0% in reaction to some cautious commentary from Citron Research.

Unsurprisingly, the S&P 500’s top-weighted technology sector, which houses most of the aforementioned names, finished at the bottom of Tuesday’s sector standings with a loss of 3.5%. The second-most influential sector, financials, also underperformed, losing 2.0%, and the consumer discretionary sector, which houses Amazon, lost 1.9%.

In total, seven of eleven S&P groups finished Tuesday in negative territory. Less-risky countercyclical sectors like consumer staples (+0.1%), utilities (+1.5%), and telecom services (+0.5%) were the top performers. Real estate (+0.1%) also had a relatively strong session, benefitting from a decline in Treasury yields; investors increased their purchases of U.S. Treasuries amid the equity sell off, pushing the benchmark 10-yr yield six basis points lower to 2.79% -- a seven-week low.

The S&P 500 finished a step above its session low, closing about 25 points above its 200-day simple moving average (2587). The index was up 0.6% at its best mark of the day and down 2.4% at its worst.

Reviewing Tuesday's economic data, which was limited to the Conference Board's Consumer Confidence Index for March and the S&P Case-Shiller Home Price Index for January:

The consumer confidence reading for March decreased to 127.7 (Briefing.com consensus 129.5) from the prior month's revised reading of 130.0 (from 130.8)
The key takeaway from the report is that, outside of a slight moderation in business expectations, consumers have not reported major changes to their outlook.
The S&P Case-Shiller Home Price Index for January increased 6.4%, which is slightly more than the Briefing.com consensus of +6.3%.

On Wednesday, investors will receive the weekly MBA Mortgage Applications Index at 7:00 AM ET, both the Advance International Trade in Goods report for February (Briefing.com consensus -$74.2 billion) and the third estimate for fourth quarter GDP (Briefing.com consensus 2.6%) at 8:30 AM ET, and Pending Home Sales for February (Briefing.com consensus +2.5%) at 10:00 AM ET.

Nasdaq Composite: +1.5% YTD
S&P 500: -2.3% YTD
Dow Jones Industrial Average: -3.5% YTD
Russell 2000: -1.4% YTD