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Market Snapshot

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

Dow 34960.69 -382.59 (-1.08%)
Nasdaq 14525.90 -130.27 (-0.89%)
SP 500 4400.27 -47.81 (-1.07%)
10-yr Note -1/32 1.276
NYSE Adv 915 Dec 2284 Vol 798.6 mln
Nasdaq Adv 1703 Dec 2554 Vol 3.8 bln

Industry Watch
Strong: Consumer Discretionary
Weak: Energy, Health Care, Information Technology

Moving the Market

-- Stocks slumped into the close on no specific catalyst

-- FOMC Minutes from the July meeting were in-line with recent commentary: tapering should begin later this year after substantial further progress has been met

-- Mixed housing data

-- Some relief in retail stocks amid earnings news

Stocks slump into the close
18-Aug-21 16:15 ET
Dow -382.59 at 34960.69, Nasdaq -130.27 at 14525.90, S&P -47.81 at 4400.27

[BRIEFING.COM] The S&P 500 fell 1.1% on Wednesday amid a flush of selling interest into the close on no specific news. The market traded relatively flat for most of the day, as investors digested earnings news from retailers, mixed economic data, and a July FOMC Minutes report that was largely in-line with expectations.

The Nasdaq Composite (-0.9%), Dow Jones Industrial Average (-1.1%), and Russell 2000 (-0.8%) declined between 0.8-1.1%.

Eight of the 11 S&P 500 sectors declined at least 1.0%, including energy (-2.4%), which fell more than 2.0%. The consumer discretionary sector (+0.2%) was the lone holdout amid some relief in retail stocks and Tesla (TSLA 688.99, +23.28, +3.5%).

Retail stocks drew support from better-than-expected earnings reports from Lowe's (LOW 199.70, +17.44, +9.6%), Target (TGT 247.95, -7.10, -2.8%), and TJX Cos. (TJX 73.31, +4.36, +6.0%). In addition, Lowe's raised its FY22 revenue guidance above consensus, and Target's CEO said he hasn't seen any slowdown due to the Delta variant. TGT shares closed lower, though.

The broader market didn't really react to the earnings news or to mixed housing starts and building permits data for July. Briefly, total housing starts were weaker than expected at 1.534 million units (Briefing.com consensus 1.610 million) while building permits were better than expected at 1.635 million (Briefing.com consensus 1.610 million). Both figures are seasonally adjusted annual rates.

Instead, there was a slight overreaction to the FOMC Minutes from the July meeting, which indicated that several Fed members thought tapering should begin later this year after substantial further progress has been met. This was in-line with recent Fed commentary when the market was hitting all-time highs.

The major indices briefly pushed toward session highs immediately following the minutes at 2:00 p.m. ET, then quickly turned around. The bulk of the selling interest happened well after the minutes were released. It's worth mentioning that trading volume at the NYSE was on the lighter side, which might have contributed to the weak price action.

The Treasury market was well behaved throughout the session. The 10-yr yield increased two basis points to 1.27%, and the 2-yr yield was unchanged at 0.21%. The U.S. Dollar Index was little changed at 93.15. WTI crude futures fell 1.7%, or $1.16, to $65.44/bbl, which reflecting lingering growth concerns.

Reviewing Wednesday's economic data:

Total housing starts declined 7.0% month-over-month to a seasonally adjusted annual rate of 1.534 million units (Briefing.com consensus 1.610 million) while building permits increased 2.6% month-over-month to a seasonally adjusted annual rate of 1.635 million (Briefing.com consensus 1.610 million).
The key takeaway from the report is that permits and starts for single-family units both declined, which speaks to some of the resistance of prospective buyers to high prices and some of the hesitancy to build new homes due to the high costs for materials, land, and labor.
The weekly MBA Mortgage Applications Index decreased 3.9% following a 2.8% increase in the prior week.
Weekly crude oil inventories decreased by 3.23 mln barrels after decreasing by 447,000 barrels during the previous week.

Looking ahead, investors will receive the weekly Initial and Continuing Claims report, the Conference Board's Leading Economic Index for August, and the Philadelphia Fed Index for August on Thursday.

S&P 500 +17.2% YTD
Dow Jones Industrial Average +14.2% YTD
Nasdaq Composite +12.7% YTD
Russell 2000 +9.3% YTD

Crude futures settle lower, weigh on energy stocks
18-Aug-21 15:30 ET
Dow -206.37 at 35136.91, Nasdaq -34.42 at 14621.75, S&P -23.48 at 4424.60

[BRIEFING.COM] The S&P 500 is trading lower by 0.4% near session lows.

One last look at the S&P 500 sectors shows energy (-1.6%), health care (-1.1%), and consumer staples (-1.1%) sectors down more than 1.0% while the consumer discretionary sector (+0.6%) sectors is the only sector trading higher.

WTI crude futures settled lower by 1.7%, or $1.16, to $65.44/bbl. On a related note, weekly crude oil inventories decreased by 3.23 mln barrels after decreasing by 447,000 barrels during the previous week.