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S&P 500 rallies past 3300 in risk-on session
16-Jan-20 16:15 ET
Dow +267.42 at 29297.55, Nasdaq +98.44 at 9357.16, S&P +27.52 at 3316.81

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

[BRIEFING.COM] The S&P 500 rose 0.8% on Thursday in a broad-based advance that carried the benchmark index past the 3300 level for the first time. The Dow Jones Industrial Average (+0.9%) and Nasdaq Composite (+1.1%) also closed at record highs, while the Russell 2000 outperformed with a 1.4% gain.

It was a day replete with good news that helped extend the market's bullish momentum and, in turn, bolster risk sentiment. Morgan Stanley (MS 56.44, +3.50, +6.6%) provided strong earnings results, retail sales increased 0.3% in December as expected, weekly jobless claims continued to reverse a modestly rising uptrend, and the USMCA deal was passed in the Senate.

All 11 S&P 500 sectors started and finished in the green, with the broader market rallying into the close. The information technology sector (+1.4%) provided the leadership amid strength in its top-weighted components and the semiconductor stocks, which got a boost from the positive earnings results from Taiwan Semiconductor (TSM 58.75, +0.36, +0.6%).

It didn't end there, though. Charles Schwab (SCHW 49.00, +1.88, +4.0%) beat earnings estimates, Signet Jewelers (SIG 30.13, +8.64, +40.2%) provided upbeat holiday sales results and comparable sales guidance, Spirit Airlines (SAVE 42.65, +2.97, +7.5%) provided upside unit revenue guidance, and XPO Logistics (XPO 95.35, +12.53, +15.1%) said it may sell or spin-off some of its business units.

Altogether, it was enough to subdue valuation concerns for at least one more day. Underlying expectations for positive earnings guidance, persistently low Treasury yields, and modest economic growth without Fed intervention were not meaningfully undermined in today's session.

Notable laggards included BNY Mellon (BK 46.72, -3.97, -7.8%), Tesla (TSLA 513.49, -5.01, -1.0%), PPG Industries (PPG 127.41, -3.33, -2.6%). BNY missed revenue estimates, Tesla was downgraded to Underweight from Equal-Weight at Morgan Stanley, and PPG issued disappointing quarterly results and guidance.

U.S. Treasuries finished on a lower note amid the risk-on mindset in equities. The 2-yr yield increased two basis points to 1.57%, and the 10-yr yield increased two basis points to 1.81%. The U.S. Dollar Index increased 0.1% to 97.30. WTI crude rose 1.1%, or $0.62, to $58.48/bbl.

Reviewing Thursday's economic data, which featured the Retail Sales report for December:

Retail sales increased 0.3% m/m in December following an upwardly revised 0.3% increase (from 0.2%) in November. Retail sales, excluding autos, jumped 0.7% (Briefing.com consensus +0.5%) after a downwardly revised unchanged reading (from 0.1%) in November.
The key takeaway from the report is that the December sales increases were broad based, with the exception of motor vehicles and parts dealers (-1.3%) and department stores (-0.8%), breathing life into the notion that the consumer remains a driving force of growth for the U.S. economy.
Initial claims for the week ending January 11 dropped by 10,000 to 204,000 (Briefing.com consensus 217,000). Continuing claims for the week ending January 4 decreased by 37,000 to 1.767 million.
The key takeaway from the report is that it reflects a tight labor market and has helped squelch a modestly rising uptrend in initial claims.
Import prices for December were up 0.3%. Excluding fuel, they were flat. Export prices were down 0.2%. Excluding agricultural products, they were down 0.1%.
The key takeaway from the report is that there were no inflation pressures embedded in the data. Nonfuel import prices were down 1.4% yr/yr while nonagricultural export prices were down 0.6%.
Total business inventories declined 0.2% month-over-month in November, as expected, following a downwardly revised 0.1% increase (from 0.2%) in October. Total business sales were up 0.7% following a downwardly revised 0.2% decline (from -0.1%) in October.
The key takeaway from the report is that the gap between inventory growth on a yr/yr basis (+2.8%) and sales growth (+1.0%) should help keep prices in check.
The Philadelphia Fed Index for January jumped to 17.0 (Briefing.com consensus 3.0) from the revised 2.4 reading in December (from 0.3).
The NAHB Housing Market Index for January declined to 75 (Briefing.com consensus 74) from 76 in December.

Looking ahead, investors will receive Housing Starts and Building Permits for December, Industrial Production and Capacity Utilization for December, and the preliminary University of Michigan Index of Consumer Sentiment for January on Friday.

Nasdaq Composite +4.3% YTD
S&P 500 +2.7% YTD
Dow Jones Industrial Average +2.7% YTD
Russell 2000 +2.2% YTD

Market Snapshot
Dow 29297.55 +267.42 (0.92%)
Nasdaq 9357.16 +98.44 (1.06%)
SP 500 3316.81 +27.52 (0.84%)
10-yr Note -2/32 1.805
NYSE Adv 2003 Dec 846 Vol 846.2 mln
Nasdaq Adv 2388 Dec 796 Vol 2.4 bln

Industry Watch
Strong: Information Technology, Industrials, Consumer Discretionary
Weak: Energy

Moving the Market

-- S&P 500 rallies past 3300 in risk-on session

-- Broad-based advance led by the technology stocks

-- Morgan Stanley (MS) rises on impressive quarterly results

-- Upbeat economic data, including an expected 0.3% increase in retail sales for December

WTI crude gains 1% in risk-on session
16-Jan-20 15:25 ET
Dow +209.20 at 29239.33, Nasdaq +73.29 at 9332.01, S&P +20.70 at 3309.99

[BRIEFING.COM] The S&P 500 is up 0.9% and is on pace to close at a record high.

One last look at the S&P 500 sectors shows all 11 sectors still trading in the green. The information technology sector (+1.1%) remains on top, while the energy sector (+0.2%) has fallen back to the bottom of the standings.

WTI crude rose $0.62 (+1.1%) to $58.48/bbl.