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Wall Street dragged by technology sector
16-Jul-20 16:20 ET
Dow -135.39 at 26734.71, Nasdaq -76.66 at 10473.92, S&P -10.99 at 3215.57

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

[BRIEFING.COM] The S&P 500 declined 0.3% on Thursday amid relative weakness in the technology sector, but the market did close near its best levels of the session. The Dow Jones Industrial Average declined 0.5%, the Nasdaq Composite declined 0.7%, and the Russell 2000 declined 0.7%.

Earnings news and economic data were mostly better than expected, but today's price action appeared to be more influenced by unrelated moves in the mega-cap technology stocks. The Nasdaq, for instance, was down as much as 1.8% intraday, but it staged a decent rebound in the afternoon as shares of Amazon (AMZN 2999.90, -8.97, -0.3%) nearly recouped an early 3.0% decline.

The top-weighted S&P 500 information technology sector, however, struggled all session with a 1.2% decline amid a lack of leadership from Apple (AAPL 386.09, -4.81, -1.2%) and Microsoft (MSFT 203.92, -4.12, -2.0%). The utilities (+1.3%), materials (+0.4%), communication services (+0.3%), and consumer staples (+0.2%) sectors closed higher.

Earnings reactions were mixed to better-than-expected results from Bank of America (BAC 23.93, -0.67, -2.7%), Morgan Stanley (MS 52.64, +1.29, +2.5%), Johnson & Johnson (JNJ 149.25, +0.99, +0.7%), and Abbott Labs (ABT 96.40, -0.33, -0.3%).

On the data front, retail sales increased 7.5% m/m in June (Briefing.com consensus 5.2%), and weekly initial jobless claims decreased by 10,000 to 1.300 million (Briefing.com consensus 1.260 million). Market reaction was muted.

In other developments, high-profile accounts on Twitter (TWTR 35.28, -0.39, -1.1%) were compromised in a bitcoin scam, Dell (DELL 59.10, +6.42, +12.2%) confirmed it's exploring a potential spin-off of its stake in VMware (VMW 139.87, +0.17, +0.1%), and American Airlines (AAL 12.45, -0.99, -7.4%) warned it could furlough or lay off up to 25,000 employees.

U.S. Treasuries finished the session mostly higher but closed near their flat lines. The 2-yr yield increased one basis point to 0.15%, while the 10-yr yield declined two basis points to 0.61%. The U.S. Dollar Index increased 0.3% to 96.33. WTI crude futures fell 0.9%, or $0.37, to $40.76/bbl.

Reviewing Thursday's economic data, which included Retail Sales for June and the weekly Initial and Continuing Claims report:

Initial jobless claims for the week ending July 11 decreased by 10,000 to 1,300,000 (Briefing.com consensus 1.260 million). Continuing claims for the week ending July 4 decreased by 422,000 to 17,338,000.
The key takeaway from the report is that initial jobless claims continue to run at extremely high levels relative to where they were before the COVID shutdown period began in March, which is a reminder that the labor market recovery still has a long, long way to go.
Retail sales increased 7.5% m/m in June (Briefing.com consensus 5.2%) following an upwardly revised 18.2% increase (from 17.7%) in May. Excluding autos, retail sales rose 7.3% (Briefing.com consensus 5.0%) on the heels of a downwardly revised 12.1% increase (from 12.4%) in May.
The key takeaway from the report is that the pace of growth slowed in June, which is important knowing that retail sales activity in July will be crimped by efforts to pause or roll back reopening activity in response to a surge in coronavirus case counts. In other words, the good news for June will be offset by an expectation for less good -- or even bad -- retail sales for July.
The NAHB Housing Market Index for July increased to 72 (Briefing.com consensus 58) from 58 in June.
The Philadelphia Fed Index for July decreased to 24.1 (Briefing.com consensus 22.5) from the 27.5 reading in June.
Business inventories declined 2.3% in May, as expected, following a revised 1.4% decline in April (from -1.3%).

Looking ahead, investors will receive Housing Starts and Building Permits for June and the preliminary University of Michigan Index of Consumer Sentiment for July on Friday.

Nasdaq Composite +16.7% YTD
S&P 500 -0.5% YTD
Dow Jones Industrial Average -6.3% YTD
Russell 2000 -12.0% YTD

Market Snapshot
Dow 26734.71 -135.39 (-0.50%)
Nasdaq 10473.92 -76.66 (-0.73%)
SP 500 3215.57 -10.99 (-0.34%)
10-yr Note +23/32 0.615
NYSE Adv 1363 Dec 1572 Vol 776.9 mln
Nasdaq Adv 1334 Dec 1905 Vol 4.2 bln

Industry Watch
Strong: Utilities, Materials, Communication Services, Consumer Staples
Weak: Information Technology, Real Estate, Energy

Moving the Market

-- Wall Street dragged by the information technology sector, but market closes well off session lows

-- Earnings news and economic data were mostly better than expected

-- Retail sales increased 7.5% m/m in June (Briefing.com consensus +5.2%), weekly initial jobless claims decreased by 10,000 to 1.300 million (Briefing.com consensus 1.260 million)

Energy stocks weighed down by lower oil prices
16-Jul-20 15:25 ET
Dow -185.48 at 26684.62, Nasdaq -91.81 at 10458.77, S&P -16.11 at 3210.45

[BRIEFING.COM] The S&P 500 is down 0.5%, while the Russell 2000 is down 1.1%. Updating the prior comment, Texas Governor Abbott denied rumors that he is considering a statewide shutdown of the state.

One last look at the S&P 500 sectors shows losses across most sectors. The information technology (-1.3%) and real estate (-1.1%) sectors are down more than 1.0%, while the utilities (+1.2%) and materials (+0.2%) sectors are the only sectors in the green.

WTI crude futures settled lower by $0.37 (-0.9%) to $40.76/bbl. The lower oil prices have weighed on the energy sector (-0.7%).