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Major indices extend weekly gains, close at new highs
06-Feb-20 16:10 ET
Dow +88.92 at 29379.68, Nasdaq +63.47 at 9572.17, S&P +11.09 at 3345.78

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

[BRIEFING.COM] The S&P 500 (+0.3%), Nasdaq Composite (+0.7%), and Dow Jones Industrial Average (+0.3%) added to their strong weekly gains and closed at fresh record highs on Thursday. The small-cap Russell 2000 (-0.3%) struggled to keep pace and closed lower.

The lead news item today was China announcing it will cut tariffs on $75 billion of U.S. imports by 50% on Feb. 14. This should not only help Beijing fulfill its pledges from the Phase One trade deal, but also provide additional economic stimulus. In the U.S., weekly jobless claims falling to their lowest level in nine months was another good sign for the economy.

Mega-cap technology stocks did the heavy lifting today, helping the S&P 500 communication services (+1.1%) and information technology (+0.9%) sectors outpace the broader market. The S&P 500, however, drifted with modest gains throughout the session, as investors presumably exercised some caution after a big week with the January employment report still due tomorrow.

The energy sector (-1.0%) was today's outright laggard after a rare outperformance yesterday.

Earnings were mixed and, keeping with recent trend, reactions were isolated to reporting companies. Twitter (TWTR 38.41, +5.02, +15.0%) and Cardinal Health (CAH 58.26, +5.58, +10.6%) stood out with impressive post-earnings gains, while Becton Dickinson (BDX 252.25, -33.74, -11.8%) and Kellogg (K 63.46, -5.90, -8.5%) were some of the laggards.

Separately, Boeing (BA 341.43, +11.88, +3.6%) shares outperformed on reports that the FAA will approve the company's design fixes to the 737 MAX. New software flaws were discovered but the goal to return to service by mid-year remained intact, according to Bloomberg.

U.S. Treasuries finished a quiet session little changed. The 2-yr yield was unchanged at 1.45%, and the 10-yr yield declined one basis point to 1.64%. The U.S. Dollar Index increased 0.2% to 98.49. WTI crude increased 0.2% to $50.97/bbl.

Reviewing Thursday's economic data:

Initial claims for the week ending February 1 decreased by 15,000 to 202,000 (Briefing.com consensus 218,000), which is a nine-month low. Continuing claims for the week ending January 25 increased by 48,000 to 1.751 million.
The key takeaway from the report is that the low level of initial claims, which are a leading indicator, is indicative of employers maintaining a positive view of the demand outlook.
The BLS reported that nonfarm business sector labor productivity increased 1.4% in the fourth quarter (Briefing.com consensus 1.7%). Unit labor costs were also up 1.4% (Briefing.com consensus 1.2%).
The key takeaway from the report is that productivity is still running below the long-term average from 1947 to 2019 (2.1%); however, the 1.7% growth in nonfarm business sector productivity in 2019 was the strongest since 2010 and above the 1.3% average for the period 2007-2019.

Looking ahead, investors will receive the Employment Situation Report for January, the Wholesale Inventories report for December, and the Consumer Credit report for December on Friday.

Nasdaq Composite +6.7% YTD
S&P 500 +3.6% YTD
Dow Jones Industrial Average +3.0% YTD
Russell 2000 +0.5% YTD

Market Snapshot
Dow 29379.68 +88.92 (0.30%)
Nasdaq 9572.17 +63.47 (0.67%)
SP 500 3345.78 +11.09 (0.33%)
10-yr Note +1/32 1.642
NYSE Adv 1359 Dec 1502 Vol 950.0 mln
Nasdaq Adv 1459 Dec 1703 Vol 2.3 bln

Industry Watch
Strong: Communication Services, Information Technology
Weak: Energy, Materials, Financials

Moving the Market

-- Stock market extends weekly gains and closes at new record highs

-- China said it will cut tariffs on $75 billion of U.S. imports by 50%

-- Weekly jobless claims drop below expectations to nine-month low

WTI crude inches higher
06-Feb-20 15:25 ET
Dow +40.17 at 29330.93, Nasdaq +44.87 at 9553.57, S&P +6.92 at 3341.61

[BRIEFING.COM] The S&P 500 is down from prior highs and is up just 0.2%.

One last look at the S&P 500 sectors before the close shows mixed results. Communication services (+1.1%) and information technology (+0.8%) outperform amid strength in the mega-cap technology stocks, while energy (-0.9%) and materials (-0.3%) underperform.

WTI crude increased $0.12 (+0.2%) to $50.97/bbl.