Negative start to the week as profit-taking hits tech stocks
11-Jan-21 16:15 ET
Dow -89.28 at 31008.63, Nasdaq -165.54 at 13036.44, S&P -25.07 at 3799.61 https://www.briefing.com/stock-market-update
[BRIEFING.COM] The S&P 500 declined 0.7% on Monday in a tech-driven decline that was more pronounced in the Nasdaq Composite (-1.3%). The Dow Jones Industrial Average (-0.3%) and Russell 2000 (-0.03%) finished closer to their flat lines amid relative strength in health care and cyclical stocks.
Technology stocks succumbed to profit-taking interest amid a continued rise in interest rates and renewed regulatory concerns after a host of companies like Facebook (FB 256.84, -10.73, -4.0%) and Twitter (TWTR 48.18, -3.30, -6.4%) restricted President Trump's online influence over the weekend.
Accordingly, the communication services (-1.8%), consumer discretionary (-1.9%), and information technology (-0.9%) sectors joined the rate-sensitive real estate (-1.7%) and utilities (-0.9%) sectors at the bottom of the standings. Tesla (TSLA 811.19, -68.83, -7.8%) shares pulled back 8% despite BoA Securities raising its price target on the stock to a Street-high $900 from $500.
Outside these groups, investors continued to put faith in an economic recovery, evident by the outperformances of the cyclical energy (+1.6%), financials (+0.4%), and materials (unch) sectors. The Philadelphia Semiconductor Index advanced 1.1%.
The health care sector (+0.5%) also finished higher amid a litany of upbeat guidance issued out of the JPMorgan Health Care Conference and strength in Eli Lilly (LLY 185.94, +19.53, +11.7%) following positive Phase 2 clinical results for treating Alzheimer's disease.
Exxon Mobil (XOM 46.84, +1.38, +3.0%) powered the energy space after Morgan Stanley upgraded the stock to Overweight from Equal Weight. Walgreens Boots Alliance (WBA 47.70, +2.49, +5.5%), meanwhile, was upgraded to the equivalent of a Buy rating at Guggenheim and Robert W. Baird.
U.S. Treasuries extended last week's retreat, driving yields higher across the curve, amid lingering expectations for more fiscal stimulus. The 2-yr yield increased two basis points to 0.15%, and the 10-yr yield increased three basis points to 1.13%. The U.S. Dollar Index increased 0.5% to 90.51. WTI crude futures declined 0.1% to $52.19/bbl.
Investors did not receive any economic data on Monday. Looking ahead to Tuesday, investors will receive the Consumer Price Index for December, the Treasury Budget for December, the Fed's Beige Book for January, and the weekly MBA Mortgage Applications Index.
Russell 2000 +5.9% YTD
Dow Jones Industrial Average +1.3% YTD
Nasdaq Composite +1.2% YTD
S&P 500 +1.2% YTD
Dow 31008.63 -89.28 (-0.29%)
Nasdaq 13036.44 -165.54 (-1.25%)
SP 500 3799.61 -25.07 (-0.66%)
10-yr Note -1/32 1.134
NYSE Adv 1238 Dec 1883 Vol 962.0 mln
Nasdaq Adv 1712 Dec 2046 Vol 6.8 bln
Strong: Health Care, Energy, Financials, Materials
Weak: Information Technology, Communication Services, Consumer Discretionary, Real Estate
Moving the Market
-- Technology stocks hit by profit-taking interest and higher interest rates
-- Health care and cyclical stocks outperformed
-- Political headwinds
Crude futures settle little changed
11-Jan-21 15:25 ET
Dow -98.16 at 30999.75, Nasdaq -182.48 at 13019.50, S&P -28.58 at 3796.10
[BRIEFING.COM] The S&P 500 is down 0.7% while the Russell 2000 is down 0.1%.
One last look at the S&P sectors shows communication services (-1.9%), consumer discretionary (-1.9%), real estate (-1.7%), information technology (-1.0%), and utilities (-1.0%) leading the broader decline, while the energy (+1.5%), health care (+0.4%), and financials (+0.3%) sectors still trade higher.
WTI crude futures settled lower by 0.1%, or $0.06, to $52.19/bbl.