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Stock Market Update

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

Market Snapshot
Dow 34200.67 +164.68 (0.48%)
Nasdaq 14052.37 +13.58 (0.10%)
SP 500 4185.47 +15.05 (0.36%)
10-yr Note 0/32 1.582
NYSE Adv 1824 Dec 1422 Vol 1.2 bln
Nasdaq Adv 1883 Dec 2220 Vol 4.4 bln

Industry Watch
Strong: Materials, Utilities, Health Care
Weak: Information Technology, Energy

Moving the Market

-- S&P 500 and Dow close at record highs in mechanical grind higher to end the week

-- Better-than-expected housing starts and building permits data for March

-- Market respects bullish trend

Market respects the bullish trend
16-Apr-21 16:15 ET
Dow +164.68 at 34200.67, Nasdaq +13.58 at 14052.37, S&P +15.05 at 4185.47

[BRIEFING.COM] The S&P 500 (+0.4%) and Dow Jones Industrial Average (+0.5%) set intraday and closing record highs on Friday in a mechanical grind higher to end the week. The Nasdaq Composite (+0.1%) and Russell 2000 (+0.3%) posted smaller gains.

There's a saying on Wall Street that loosely goes, "the trend is your friend until the end." Well, the trend in the S&P 500 has been extremely bullish over the past three weeks, and despite an absence of strong buying conviction today, the market found a way to respect the trend.

Nine of the 11 S&P 500 sectors contributed the advance, including the lightly-weighted materials sector (+1.2%) as the only sector to gain more than 1.0%. Value stocks outpaced growth stocks, evidenced by the 0.6% gain in the iShares S&P 500 Value ETF (IVE 145.60, +0.82), versus the 0.2% gain in the iShares S&P 500 Growth ETF (IVW 69.98, +0.16).

The SPDR S&P Homebuilders ETF (XHB 75.11, +1.59, +2.2%) was a pocket of strength, rising 2% to all-time highs, following the better-than-expected housing starts and building permits report for March, which showcased a 30.8% m/m surge in multi-unit starts.

On the downside, the information technology sector (-0.03%), which is the most heavily-weighed sector in the S&P 500, limited the index performance with a fractional decline amid a rebound in long-term interest rates. The energy sector (-0.9%) was the weakest performer amid lower oil prices ($63.16, -0.28, -0.4%).

The 10-yr yield increased four basis points to 1.57% after dropping 11 basis points on Thursday. The rebound appeared to be technically-oriented since the Treasury market barely reacted to the encouraging housing data. The 2-yr yield increased two basis points to 0.16%. The U.S. Dollar Index decreased 0.2% to 91.54.

This curve-steepening activity provided support for the financials sector (+0.7%), which included disappointing reactions to better-than-expected earnings reports from Morgan Stanley (MS 78.59, -2.23, -2.8%), BNY Mellon (BK 46.07, -1.94, -4.0%), and State Street (STT 80.47, -6.04, -7.0%).

In other corporate news, Cisco (CSCO 52.80, +1.16, +2.3%) was upgraded to Outperform from Peer Perform at Wolfe Research. Boeing (BA 148.18, -2.93, -1.2%) struggled after Reuters reported that aircraft inspectors found wider electrical issues with the 737 MAX than originally suspected.

Reviewing Friday's economic data:

Housing starts surged 19.4% month-over-month in March to a seasonally adjusted annual rate of 1.739 million units (Briefing.com consensus 1.621 million), bolstered by a 15.3% increase in single-family starts. Building permits increased 2.7% month-over-month to 1.766 million (Briefing.com consensus 1.750 million), helped by a 4.6% increase in single-family permits.
The key takeaway from the report is that it reflects a quick snapback from the weather-induced downturn in February, which is indicative of otherwise strong industry conditions that are being driven by strong demand for new homes.
The preliminary reading for the University of Michigan Consumer Sentiment Index for April checked in at 86.5 (Briefing.com consensus 88.0), up from the final reading of 84.9 for March. This is the highest reading in a year and was paced by improved attitudes on current conditions that were helped by job gains, rising vaccination rates, low interest rates, and fiscal stimulus.
The key takeaway from the report is the disclosure that year-ahead inflation expectations of 3.7% are the highest they have been in nearly a decade; however, inflation expectations over the next five years were lower at 2.7%.

Looking ahead, there is no economic data of note on the calendar until Wednesday.

Russell 2000 +14.6% YTD
Dow Jones Industrial Average +11.7% YTD
S&P 500 +11.4% YTD
Nasdaq Composite +9.0% YTD

WTI crude futures settle slightly lower
16-Apr-21 15:30 ET
Dow +172.28 at 34208.27, Nasdaq +11.67 at 14050.46, S&P +15.93 at 4186.35

[BRIEFING.COM] The S&P 500 is up 0.4% and on track to close at another record high. The same goes for the Dow (+0.5%) and Nasdaq 100 (+0.1%).

One last look at the S&P 500 sectors shows nine sectors trading higher and two trading lower. The materials (+1.3%) and utilities (+1.0%) sectors are up by at least 1.0%, while the information technology (-0.1%) and energy (-0.7%) sectors trade lower.

WTI crude futures settled lower by 0.4%, or $0.28, to $63.16/bbl.