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Stock Market Update

Stocks extend weekly decline amid continued turmoil in oil market
21-Apr-20 16:15 ET
Dow -631.56 at 23018.88, Nasdaq -297.50 at 8263.24, S&P -86.60 at 2736.56

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

[BRIEFING.COM] The S&P 500 fell 3.1% on Tuesday, closing near session lows for its second straight decline, as risk sentiment remained suppressed by the ongoing turmoil in the oil futures market. The Dow Jones Industrial Average declined 2.7%, the Nasdaq Composite declined 3.5%, and the Russell 2000 declined 2.3%.

The May WTI contract officially expired at $10.01/bbl after falling negative yesterday, but the fundamental problems that drove the contract into negative territory continued to plague the rest of the WTI futures curve. The June WTI contract plunged 43.0%, or $8.70, to $11.57/bbl, although it did touch $6.50/bbl at its low.

Remarkably, the S&P 500 energy sector (-1.7%) performed relatively well despite the risking risks of credit defaults, dividend cuts, and job losses facing many of its components. President Trump may have alleviated some worries on the jobs front after vowing to protect energy companies with appropriate funding.

As for the broader market, there might have been a general sense that it was due for a breather following the incredible rally from the March 23 lows, with the angst in the oil market allowing for some rethinking about the economic outlook.

The information technology sector (-4.1%) underperformed in a rare outing amid broad-based selling, which included an earnings-related decline in IBM (IBM 116.76, -3.65, -3.0%). The utilities (-1.6%) and real estate (-1.6%) sectors declined the least today.

In other earnings news, Dow components Coca-Cola (KO 45.31, -1.22, -2.6%) and Travelers (TRV 101.78, unch) finished mixed following their earnings reports.

Separately, news that Congressional leaders and the Trump administration reached a stimulus bill agreement, which reportedly includes $310 billion in small business funding, was encouraging but not market moving. The Senate and House will still need to vote on the bill.

In the U.S. Treasury market, longer-dated tenors continued to exhibit strength in a safety trade. The 2-yr yield declined one basis point to 0.20%, and the 10-yr yield declined six basis points to 0.57%. The U.S. Dollar Index increased 0.2% to 100.17.

Reviewing Tuesday's economic data:

Existing home sales declined 8.5% m/m in March to a seasonally adjusted annual rate of 5.27 million (Briefing.com consensus 5.35 million). Total sales were up 0.8% year-over-year, marking the ninth straight month that they have increased on a year-over-year basis.
The key takeaway from the report is that it showed existing home sales activity was relatively soft before the COVID-19 impact, with low inventory and high prices crimping sales. Existing home sales are counted when the deals are closed, so the sales activity for March is predicated mostly on contracts signed in January and February.

Looking ahead, investors will receive the weekly MBA Mortgage Applications Index and the FHFA Housing Market Index for April on Wednesday.

Nasdaq Composite -7.9% YTD
S&P 500 -15.3% YTD
Dow Jones Industrial Average -19.3% YTD
Russell 2000 -29.0% YTD

Market Snapshot
Dow 23018.88 -631.56 (-2.67%)
Nasdaq 8263.24 -297.50 (-3.48%)
SP 500 2736.56 -86.60 (-3.07%)
10-yr Note +4/32 0.562
NYSE Adv 588 Dec 2275 Vol 1.0 bln
Nasdaq Adv 803 Dec 2418 Vol 3.7 bln

Industry Watch
Strong: Energy, Utilities, Real Estate
Weak: Information Technology

Moving the Market

-- Stocks extend weekly declines, close near session lows

-- WTI crude contract for June tanks 43% to $11.57/bbl

-- Relative weakness in the information technology sector

June WTI contract tanks 43%
21-Apr-20 15:30 ET
Dow -499.77 at 23150.67, Nasdaq -243.77 at 8316.97, S&P -71.87 at 2751.29

[BRIEFING.COM] The S&P 500 is down 2.6%, extending its weekly decline to 4.4%.

One last look at the S&P 500 sectors shows energy (-0.7%) down the least despite the turmoil in the oil futures market. The information technology sector (-3.5%) remains at the bottom of the standings amid broad-based selling interest.

WTI crude futures (June) tanked $8.70 (-43.0%) to $11.57/bbl amid the same issues that took the May WTI contract negative yesterday.