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Stocks Slip After Trump Cancels North Korea Summit
24-May-18 16:25 ET
Dow -75.05 at 24811.76, Nasdaq -1.53 at 7424.43, S&P -5.53 at 2727.76

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

[BRIEFING.COM] The stock market was on track for a sizable loss on Thursday following President Trump's decision to cancel his June 12 summit with North Korean leader Kim Jong Un, but nearly reclaimed all of that loss in an intraday rebound. The S&P 500 was down as much as 1.0% before ending the session lower by 0.2%. Meanwhile, the Dow finished lower by 0.3%, and the Nasdaq closed just a tick beneath its flat line.

In a letter to Mr. Kim, President Trump said he felt it was "inappropriate" to go through with their planned meeting based on the "tremendous anger and open hostility" displayed in a recent statement directed at Vice President Mike Pence. The cancellation is obviously a blow to U.S.-North Korea relations, which appeared to be warming before North Korea started reverting to old habits in recent weeks, but it also might be a blow to U.S.-China relations as Mr. Trump has insinuated that Chinese President Xi might have had something to do with North Korea's change in attitude.

Also out of Washington, President Trump officially signed the Dodd-Frank reform bill on Thursday, which rolled back regulations on small and medium-sized lenders put in place following the 2008 financial crisis. The president also added that the rollback may be extended to larger banks in the future. Separately, The Wall Street Journal reported that the Trump administration is considering import tariffs on automobiles that could be as high as 25%. American automakers Ford Motor (F 11.62, +0.18) and General Motors (GM 38.39, +0.54) rallied more than 1.0% the news, while foreign automakers slid.

The S&P 500 sectors finished Thursday mostly lower, with seven of eleven closing in the red. The energy sector (-1.7%) was the weakest space, suffering amid another decline in the price of crude oil, which has now dropped for three sessions in a row amid fears that OPEC may boost production due to supply concerns out of Iran and Venezuela. WTI crude futures ended 1.6% lower at $70.71 per barrel. The heavily-weighted financial sector (-0.7%) was also relatively weak as Treasury yields declined for the second day in a row. The benchmark 10-yr yield ended two basis points lower at 2.98%.

On a positive note, the consumer discretionary (+0.2%), industrials (+0.6%), telecom services (+0.6%), and utilities (+0.8%) sectors finished in the green. General Electric (GE 14.60, +0.42) led the industrial sector higher, adding 3.0%, after CNBC's David Faber reported that the company does not plan to cut its dividend (refuting reports from earlier in the week). Meanwhile, in the consumer discretionary space,electronics retailer Best Buy (BBY 70.90, -5.05) slid 6.7% despite reporting above-consensus earnings and revenues for the first quarter.

Reviewing Thursday's economic data, which included weekly Initial Claims, Existing Home Sales for April, and the FHFA Housing Price Index for March:

The latest weekly initial jobless claims count totaled 234,000, while the Briefing.com consensus expected a reading of 220,000. Today's tally was above the revised prior week count of 223,000 (from 222,000). As for continuing claims, they rose to 1.741 million from a revised count of 1.712 million (from 1.707 million).
While initial claims were higher than expected, the key takeaway from the report is that it won't do anything to upset the favorable perspective on the initial claims trend.
Existing home sales decreased 2.5% in April to an annualized rate of 5.46 million units (Briefing.com consensus 5.57 million). The March reading was left unrevised at 5.60 million.
The key takeaway from the report remains the same: notable supply constraints continue to act as a drag on overall sales. The limited inventory -- and the high prices on available inventory -- is crimping affordability, particularly for first-time buyers; moreover, all prospective buyers are going to feel added affordability pressures from rising mortgage rates.
The FHFA Housing Price Index rose 0.1% in March (Briefing.com consensus +0.6%), and the February increase was left unrevised at 0.6%.

Looking ahead to Friday, investors will receive April Durable Orders and the final reading of the University of Michigan Consumer Sentiment Index for May.

Nasdaq Composite +7.6% YTD
Russell 2000 +6.0% YTD
S&P 500 +2.0% YTD
Dow Jones Industrial Average +0.4% YTD