Sector Investing

[ReturntoSender]

Late selling snaps winning streak in S&P 500 and Dow
11-Aug-20 16:15 ET
Dow -104.53 at 27686.91, Nasdaq -185.53 at 10782.89, S&P -26.78 at 3333.69

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

[BRIEFING.COM] The S&P 500 advanced as much as 0.6% on Tuesday on the back of continued strength in the value and cyclical stocks, but broad-based selling in the last hour of trading left the benchmark index down 0.8% for the session to snap a seven-session winning streak. The Nasdaq Composite underperformed with a 1.7% decline.

The Dow Jones Industrial Average declined 0.4% after rising as much as 1.3% intraday, and the Russell 2000 declined 0.6% after rising as much as 1.2% intraday.

The late-day selling was attributed to comments from Senate Majority Leader McConnell (R-KY), who told Fox News that White House officials have yet to reconvene with congressional Democrats regarding fiscal relief for households and businesses. The news appeared to be a good excuse to tame the market as the S&P 500 came within 0.4% of its all-time high today.

Growth and defensive-oriented stocks saw increased selling that weighed on the S&P 500 information technology (-1.8%), utilities (-2.2%), real estate (-1.9%), and communication services (-1.3%) sectors. Conversely, the financials (+1.3%) and industrials (+0.5%) sectors managed to close higher due to their perceived value.

Notably, U.S. Treasuries and precious metals succumbed to sizable pullbacks. The 2-yr yield increased three basis points to 0.16%, while the 10-yr yield increased eight basis points to 0.66% -- this curve-steepening activity was a boon for the financial stocks. Gold futures fell 4.5% to $1946.90/ozt. The U.S. Dollar Index increased 0.2% to 93.72. WTI crude futures declined 0.7% to $41.66/bbl.

In other macro developments, President Trump floated the idea of cutting taxes on capital gains and middle-income families to further stimulate the economy, and Russia jumped ahead key testing stages to approve a COVID-19 vaccine. Note, it appears unlikely that Congress would approve such legislation or that people would seek out the Russian vaccine.

Separately, Qualcomm (QCOM 108.83, +2.47, +2.3%) shares bucked the negative trend in the tech space after the company reportedly won an appeal in its FTC antitrust case.

Reviewing Tuesday's economic data:

The Producer Price Index for final demand increased 0.6% in July (Briefing.com consensus 0.3%) after decreasing 0.2% in May. Excluding food and energy, the index for final demand rose 0.5% (Briefing.com consensus 0.1%) after decreasing 0.3% in May.
The key takeaway from the report is that inflation pressures at the producer level have increased, but they remain low at this time.
The NFIB Small Business Optimism Index decreased to 98.8 in July from 100.6 in June.

Looking ahead, investors will receive the Consumer Price Index for July, the Treasury Budget for July, and the weekly MBA Mortgage Applications Index on Wednesday.

Nasdaq Composite +20.2% YTD
S&P 500 +3.2% YTD
Dow Jones Industrial Average -3.0% YTD
Russell 2000 -5.6% YTD

Market Snapshot
Dow 27686.91 -104.53 (-0.38%)
Nasdaq 10782.89 -185.53 (-1.69%)
SP 500 3333.69 -26.78 (-0.80%)
10-yr Note -27/32 0.636
NYSE Adv 1473 Dec 1467 Vol 956.0 mln
Nasdaq Adv 1266 Dec 1900 Vol 4.3 bln

Industry Watch
Strong: Financials, Industrials
Weak: Information Technology, Utilities, Real Estate, Communication Services

Moving the Market

-- Late-day selling takes market lower, snapping winning streaks in S&P 500 and Dow

-- Value and cyclical stocks outperformed, growth stocks lagged

-- Treasury yields rose in curve-steepening trade

-- President Trump floated idea of tax cuts on capital gains, middle-income families; Russia approved COVID-19 vaccine

WTI crude settles lower, stock market turns negative
11-Aug-20 15:25 ET
Dow +16.65 at 27808.09, Nasdaq -120.80 at 10847.62, S&P -14.45 at 3346.02

[BRIEFING.COM] The market has succumbed to some late-day selling in the final hour of trading. The S&P 500 is down 0.4%, with some attributing the decline to comments from lawmakers that stimulus talks have yet to resume between both sides.

One last look at the S&P 500 sectors shows information technology (-1.1%), utilities (-1.9%), real estate (-1.5%), and communication services (-0.8%) leading the decline, while the financials (+1.7%), industrials (+0.8%), and energy (+0.3%) sectors still trade higher.

WTI crude futures settled lower by 0.7%, or $0.29, to $41.66/bbl.