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Market Snapshot

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

Dow 34564.59 +344.23 (1.01%)
Nasdaq 13643.58 +272.02 (2.03%)
SP 500 4446.59 +49.14 (1.12%)
10-yr Note +3/32 2.698
NYSE Adv 2373 Dec 858 Vol 790.0 mln
Nasdaq Adv 3348 Dec 1222 Vol 4.8 bln

Industry Watch
Strong: Consumer Discretionary, Information Technology, Communication Services
Weak: Financials, Utilities

Moving the Market

-- Not deterred by EPS miss from JPMorgan Chase (JPM) or hotter-than-expected PPI data for March

-- Investors buy the dip

-- Treasury yields decline for second straight day

Undeterred by JPM earnings miss and hot PPI data
13-Apr-22 16:15 ET
Dow +344.23 at 34564.59, Nasdaq +272.02 at 13643.58, S&P +49.14 at 4446.59

[BRIEFING.COM] The S&P 500 rose 1.1% on Wednesday in a relatively broad-based advance led by the growth stocks. The Dow Jones Industrial Average (+1.0%) rose comparably, while the Nasdaq Composite (+2.0%) and Russell 2000 (+1.9%) outperformed with roughly 2% gains.

Investors assumed a dip-buying mindset, undeterred by a larger than expected 1.4% m/m increase in the Producer Price Index (PPI) for March (Briefing.com consensus 1.2%) and an earnings miss from JPMorgan Chase (JPM 127.30, -4.24, -3.2%).

The S&P 500 reclaimed its 50-day moving average (4422) on a closing basis amid gains in nine of its 11 sectors. Six sectors advanced at least 1.0%, including a 2.5% gain for the consumer discretionary sector (+2.5%).

Airline stocks were particularly strong after Delta Air Lines (DAL 41.02, +2.40, +6.2%) beat top and bottom-line estimates and Delta's CEO provided upbeat bookings commentary. The U.S. Global Jets ETF (JETS 21.65, +1.09) rose 5.3%.

Conversely, the financials (-0.1%) and utilities (-0.2%) sectors closed lower, with the former pressured by JPM's disappointing earnings results and a second-straight decline in Treasury yields.

The 2-yr yield decreased five basis points to 2.34%, and the 10-yr yield decreased four basis points to 2.69%. The U.S. Dollar Index fell 0.4% to 99.88.

The decline in rates helped alleviate some of the valuation concerns in the growth stocks, including the mega-caps. The Vanguard Mega Cap Growth ETF (MGK 225.04, +4.02) rose 1.8%, versus a 1.1% gain for the Invesco S&P 500 Equal Weight ETF (RSP 156.60, +1.75).

Demand for Treasuries was presumably influenced by the peak inflation narrative and cautious-sounding commentary from JPM CEO Jamie Dimon about the economic challenges ahead. The PPI report wasn't that surprising, either, after the hot CPI report yesterday, suggesting the report was already priced in.

WTI crude futures, meanwhile, flirted with $105 per barrel ($104.25, +3.56, +3.5%) despite bearish inventory data from the EIA and a downwardly revised 2022 global demand growth forecast from the IEA.

Reviewing Wednesday's economic data:

The Producer Price Index for final demand jumped 1.4% month-over-month in March (Briefing.com consensus 1.2%) following an upwardly revised 0.9% increase (from 0.8%) in February. The index for final demand, less foods and energy, rose 1.0% month-over-month (Briefing.com consensus 0.5%) following an upwardly revised 0.4% increase (from 0.2%) in February. On a year-over-year basis, the index for final demand was up 11.2% while the index for final demand, less foods and energy, was up 9.2%. The accompanying tables for the report show a lengthy list of double-digit percentage increases on a year-over-year basis for many categories.
The key takeaway from the report is that it is a signpost of potential profit margin pressures that are going to intensify if consumers start showing more resistance to price increases. Beyond that, it's another reminder that the Fed needs to get aggressive with its policy to get these rampant inflation pressures in check.
The weekly MBA Mortgage Applications Index decreased 1.3% following a 6.3% decline in the prior week.

Looking ahead to Thursday, investors will receive Retail Sales for March, weekly Initial and Continuing Claims, the preliminary University of Michigan Index of Consumer Sentiment for April, Import and Export Prices for March, and Business Inventories for February.

Dow Jones Industrial Average -4.9% YTD
S&P 500 -6.7% YTD
Russell 2000 -9.8% YTD
Nasdaq Composite -12.8% YTD

Crude futures stay above $100
13-Apr-22 15:30 ET
Dow +329.22 at 34549.58, Nasdaq +283.23 at 13654.79, S&P +49.69 at 4447.14

[BRIEFING.COM] The S&P 500 is up 1.2% and on track to close above its 50-day moving average (4422).

One last look at the S&P 500 sectors shows consumer discretionary (+2.6%), information technology (+1.7%), and communication services (+1.4%) in the top three positions, while the financials (-0.2%) and utilities (-0.3%) underperform with modest losses.

WTI crude futures settled higher by $3.56 (+3.5%) to $104.25/barrel.