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Market Snapshot

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

Dow 35457.31 +198.70 (0.56%)
Nasdaq 15129.08 +107.28 (0.71%)
SP 500 4519.63 +33.17 (0.74%)
10-yr Note -1/32 1.607
NYSE Adv 1834 Dec 1372 Vol 695.0 mln
Nasdaq Adv 2706 Dec 1711 Vol 4.4 bln

Industry Watch
Strong: Health Care, Energy, Utilities
Weak: Consumer Staples, Consumer Discretionary

Moving the Market

-- S&P 500 and Nasdaq up for the fifth straight day

-- Diversified batch of earnings news

-- Mega-cap support

-- Oil prices and 10-yr yield flirting with yesterday's highs

-- Procter & Gamble (PG) warns about higher commodity and freight costs

Market extends winning streak
19-Oct-21 16:25 ET
Dow +198.70 at 35457.31, Nasdaq +107.28 at 15129.08, S&P +33.17 at 4519.63

[BRIEFING.COM] The S&P 500 (+0.7%) and Nasdaq Composite (+0.7%) both advanced 0.7% on Tuesday and extended their winning streaks to five sessions. Risk sentiment was supported by better-than-expected earnings reports from a diversified group of companies while the market continued to weather supply chain challenges.

The Dow Jones Industrial Average increased 0.6%, and the Russell 2000 increased 0.4%.

The earnings lineup included EPS beats from Johnson & Johnson (JNJ 163.87, +3.75, +2.3%), Procter & Gamble (PG 140.66, -1.68, -1.2%), Travelers (TRV 155.39, +2.51, +1.6%), Dover (DOV 167.91, +1.12, +0.7%), and Steel Dynamics (STLD 63.50, +1.08, +1.7%). P&G, however, warned about higher commodity and freight costs this fiscal year.

P&G's warning pressured shares of the company and fed into the inflation concerns that have been driving oil prices ($83.01/bbl, +0.57, +0.7%) and long-term interest rates higher. The 10-yr yield rose five basis points to 1.64%, while the 2-yr yield fell three basis points to 0.39%.

Buyers in the stock market, however, looked past inflation/supply chain headwinds and took the earnings news at face value. Ten of the 11 S&P 500 sectors closed higher, led by utilities (+1.3%), health care (+1.3%), and energy (+1.2%) with gains over 1.0%.

The consumer discretionary sector (-0.3%) was the lone holdout amid weakness in the retail stocks, including Ulta Beauty (ULTA 363.35, -43.00, -10.6%), which provided disappointing long-term financial targets.

Aside from JNJ, other heavyweights like Apple (AAPL 148.76, +2.21, +1.5%), Facebook (FB 339.99, +4.64, +1.4%), and Walmart (WMT 144.69, +3.01, +2.1%) also provided key leadership. Walmart was added the Conviction Buy List at Goldman Sachs.

Separately, the market overlooked a disappointing housing starts and building permits report for September. The report featured a 7.7% m/m decline in building permits to a seasonally adjusted annual rate of 1.555 million units (Briefing.com consensus 1.620 million).

As highlighted earlier, the Treasury yield curve steepened amid selling interest in longer-dated maturities. Bank stocks, though, underperformed on a relative basis despite the potential benefit for net interest margins. The SPDR S&P Bank ETF (KBE 55.60, +0.14, +0.3%) increased just 0.3%. The U.S. Dollar Index fell 0.2% to 93.77.

Reviewing Tuesday's economic data:

Housing starts declined 1.6% month-over-month in September to a seasonally adjusted annual rate of 1.555 million units (Briefing.com consensus 1.620 million), but were up 7.4% year-over-year. Building permits were down 7.7% month-over-month to a seasonally adjusted annual rate of 1.589 million (Briefing.com consensus 1.670 million) and were flat year-over-year.
The key takeaway from the report is that it reflects a slowdown in the pace of new construction, which is a byproduct of supply shortages, labor constraints, and high prices.

Looking ahead, investors will receive the Fed's Beige Book for October and the weekly MBA Mortgage Applications Index on Wednesday.

S&P 500 +20.3% YTD
Nasdaq Composite +17.4% YTD
Dow Jones Industrial Average +15.9% YTD
Russell 2000 +15.2% YTD

WTI crude futures settle at $83 per barrel
19-Oct-21 15:30 ET
Dow +162.89 at 35421.50, Nasdaq +102.65 at 15124.45, S&P +30.40 at 4516.86

[BRIEFING.COM] The S&P 500 is up 0.7% to trade back at session highs. The benchmark index is on pace to close higher for the fifth straight day.

One last look at the S&P 500 sectors shows health care (+1.3%), utilities (+1.3%), and energy (+1.0%) up at least 1.0%, while the consumer discretionary (-0.2%) and consumer staples (-0.01%) sectors continue to trade lower.

WTI crude futures settled higher by 0.7%, or $0.57, to $83.01/bbl.