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S&P 500 Closes Out the Week on Higher Note, Led by Industrials
18-Apr-19 16:20 ET
Dow +110.00 at 26559.54, Nasdaq +1.98 at 7998.05, S&P +4.58 at 2905.03

https://www.briefing.com/investor/markets/stock-market-update/2019/4/18/s-and-p-500-closes-out-the-week-on-higher-note-led-by-industrials.htm

[BRIEFING.COM] The S&P 500 increased 0.2% on Thursday to close out the holiday-shortened trading week. Leadership from the industrials sector (+1.1%) and a turnaround in the health care sector (+0.1%) contributed to the upside bias, as most sectors finished little changed.

The Nasdaq Composite finished flat, and the Russell 2000 lost 0.1%. The Dow Jones Industrial Average outperformed with a gain of 0.4%, helped in part by the positive reactions to earnings reports from American Express (AXP 113.67, +1.91, +1.7%) and Travelers (TRV 138.93, +3.06, +2.3%).

The industrials sector also benefited from a host of solid earnings reports, which included those from Union Pacific (UNP 176.66, +7.38, +4.4%), Honeywell (HON 169.06, +6.17, +3.8%), United Rentals (URI 136.00, +10.24, +8.1%), Danaher (DHR 126.77, +1.89, +1.5%), Dover (DOV 97.78, +0.98, +1.0%), and Snap-On (SNA 168.07, +10.23, +6.5%).

Upbeat results from the economically-sensitive sector, coupled with better-than-expected retail sales for March and a decline in weekly initial claims, provided investors with some assurance that the U.S. economy remains in good shape.

The health care sector increased just 0.1%, but the group had been down as much as 1.3% shortly after giving up its early advance. Yesterday's decline in the sector wiped out its yearly gain, and its resiliency to follow-through selling amid political concerns helped the broader market overcome early weakness.

In IPO news, Zoom Video Communications (ZM 62.00, +26.00, +72.2%) and Pinterest (PINS 24.40, +5.40, +28.4%) made their public debuts on Thursday. Zoom opened at $65.00 after pricing at $36.00, and Pinterest opened at $23.75 after pricing at $19.00.

U.S. Treasuries finished on a higher note, pushing yields lower across the curve. The 2-yr yield declined two basis points to 2.38%, and the 10-yr yield declined three basis points to 2.56%. The U.S. Dollar Index rose 0.5% to 97.46. WTI crude increased 0.4% to $64.03/bbl, overcoming some intraday weakness.

Reviewing Thursday's batch of economic data, which included Retail Sales for March, the weekly Initial and Continuing Claims report, the Philadelphia Fed Index for April, Business Inventories for February, and the Conference Board's Leading Economic Index for March:

Total retail sales in March increased 1.6% (Briefing.com consensus +0.9%) after an unrevised 0.2% decline in February. Excluding autos, they were up 1.2% (Briefing.com consensus +0.7%) following an upwardly revised 0.2% decline (from -0.4%) in February.
The key takeaway from the report is that the sales strength was broad-based with nice gains seen across discretionary spending categories. This data will compute well in the calculation of the goods component for personal consumption expenditures in the Q1 GDP report.
Initial claims for the week ending April 13 decreased by 5,000 to 192,000 (Briefing.com consensus 208,000), which is the lowest level since September 6, 1969. Continuing claims for the week ending April 6 decreased by 63,000 to 1.653 million.
The key takeaway from the initial claims data (a leading indicator) remains unchanged: it shows employers are reluctant to let go of employees, either because they can't find qualified workers or because they see demand being strong enough to justify the size of their existing work force.
The Philadelphia Fed Index dipped to 8.5 in April (Briefing.com consensus 11.0) from 13.7 in March. The New Orders Index, however, surged to 15.7 from 1.9.
The key takeaway from the report was found in the diffusion index for future general activity, which fell to its lowest level (to 19.1 from 21.8) since February 2016, suggesting there is some fading optimism in future business activity.
Business inventories increased 0.3% in February (Briefing.com consensus +0.4%) following an upwardly revised 0.9% increase (from +0.8%) in January. Business sales increased 0.1% on the heels of an unrevised 0.3% increase in January.
The key takeaway from the report is that the inventory boost will be a positive input for Q1 GDP forecasts.
The Conference Board's Leading Economic Index increased 0.4% in March, as expected, following a downwardly revised 0.1% increase (from 0.2%) in February.
The key takeaway from the report is that there weren't any negative contributions from index components in March; however, the index is reflecting a slower pace of growth, having increased 0.4% for the six-month period ending March 2019 versus growth of 2.8% during the previous six months.

As a reminder, the stock market will be closed tomorrow for Good Friday. Investors will receive Existing Home Sales for March on Monday.

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