Sector Investing

[ReturntoSender]

Market Snapshot

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

Dow 34269.16 -473.66 (-1.36%)
Nasdaq 13389.46 -12.43 (-0.09%)
SP 500 4152.10 -36.33 (-0.87%)
10-yr Note -1/32 1.615

NYSE Adv 875 Dec 2389 Vol 994.5 mln
Nasdaq Adv 1565 Dec 2405 Vol 4.7 bln


Industry Watch
Strong: Materials

Weak: Energy, Financials, Industrials


Moving the Market
-- Cyclical/non-technology stocks succumbed to profit-taking interest

-- Growth stocks pared early losses as investors finally started to buy the dip

-- Pestering inflation expectations manifested in Treasury market and commodities





Non-technology stocks get hit, while growth stocks pare losses
11-May-21 16:20 ET

Dow -473.66 at 34269.16, Nasdaq -12.43 at 13389.46, S&P -36.33 at 4152.10
[BRIEFING.COM] The S&P 500 lost 0.9% on Tuesday in a relatively broad-based decline, although growth stocks benefited from a buy-the-dip mindset following a weak open. The Nasdaq Composite decreased 0.1% after starting with a 2.2% decline, and the Russell 2000 decreased 0.3% after starting with a 2.5% decline.

The Dow Jones Industrial Average underperformed and closed lower by 1.4% following yesterday's record-setting session.

For a change of pace this month, selling interest was concentrated in the cyclical/non-technology stocks, including those within the energy (-2.6%), financials (-1.7%), and industrials (-1.4%) sectors. The materials sector (+0.4%) was an exception and was the only sector in the S&P 500 that closed higher today.

Arguably, cyclical stocks were due for some profit taking after a strong start to the month, even though longer-dated Treasury yields and commodities continued to reflect inflation expectations. Inflation expectations were partially due to China's April PPI (+6.8% yr/yr) hitting its highest level since 2017 ahead of the U.S. April CPI report tomorrow.

The 10-yr yield increased two basis points to 1.62%, and the 2-yr yield increased one basis point to 0.16%. WTI crude futures increased 0.7%, or $0.45, to $65.25/bbl. Copper futures rose 1.5%, or $0.07, to $4.79/lb. The U.S. Dollar Index was little changed at 90.18.

Growth stocks, meanwhile, had a pitiful start that was attributed to negative momentum and the uptick in long-term interest rates. Fortunately, the weak open was viewed as an opportunistic entry point considering many of these stocks were down substantially from their record highs.

The ARK Innovation ETF (ARKK 106.12, +2.14, +2.1%) rose 2% after being down 5% intraday (and 38% off its record high), and the Philadelphia Semiconductor Index gained 0.3% after being down 3.2% intraday. The Vanguard Mega Cap Growth ETF (MGK 214.14, -0.50) declined just 0.2% after being down 1.9% intraday.

Roblox (RBLX 77.33, +13.33, +20.8%), which never traded lower today, rose 21% following its earnings report and the bargain-hunting mindset in growth stocks. Palantir (PLTR 20.21, +1.74, +9.4%) was initially down about 8% following its earnings report but closed higher by 9%.

Reviewing Tuesday's economic data:

Job openings increased to 8.123 million in March from a revised 7.526 million in February (from 7.367 million).
The NFIB Small Business Optimism Index for April increased to 99.8 from 98.2 in March.

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

Dow Jones Industrial Average +12.0% YTD
Russell 2000 +11.8% YTD
S&P 500 +10.5% YTD
Nasdaq Composite +3.9% YTD



Crude futures settle above $65 per barrel
11-May-21 15:30 ET

Dow -411.71 at 34331.11, Nasdaq +15.46 at 13417.35, S&P -29.48 at 4158.95
[BRIEFING.COM] The S&P 500 is down 0.7%, and the Russell 2000 is down 0.4%.

One last look at the S&P 500 sectors shows energy (-2.3%), industrials (-1.4%), financials (-1.4%), and utilities (-1.4%) leading the decline, while the materials sector (+0.4%) bucks the negative trend with a 0.4% gain. For a change this month, non-technology stocks are underperforming.

WTI crude futures settled higher by 0.7%, or $0.45, to $65.25/bbl.