After The Close - Equities got off to a decent start this morning, weakened during the afternoon, but strengthened into the close. At the end of the day, the Dow Jones Industrial Average was ahead 28 points; the broader S&P 500 Index was up two points; and the NASDAQ was higher by three points. Market breadth was positive, as advancers outpaced decliners on the NYSE. The major sectors were divided, as gains in the utility and healthcare issues offset losses in the energy and consumer cyclical stocks.
Traders received a few economic reports today. The Conference Board’s Consumer Confidence Index slipped to 122.1 during the month of December, where analysts had been looking for a better showing. Meanwhile, pending home sales rose 0.2% in the month of November, coming in better than had been expected. Tomorrow, we will get a look at the weekly initial jobless claims. The EIA will also release its latest crude oil inventory figures.
Elsewhere, few corporations delivered quarterly financial results today. However, the fourth quarter of 2017 will soon be over, and the reporting season will bring plenty of news, especially as companies offer initial guidance for 2018.
Technically, the stock market put in another quiet session, as many traders are likely away until the new year commences. – Adam Rosner
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
Before The Bell - Wall Street started out the final week of a stellar year for equities on a mixed noted, with modest gains in the Dow Jones Industrial Average, the S&P Mid-Cap 400, and the small-cap Russell 2000, but with rather sharp losses in the tech-laden NASDAQ on a notable retreat in shares of technology icon Apple (AAPL – Free Apple Stock Report). The retreat in Apple (the pullback was about 2.5% in mid-morning) followed a report out of Taiwan that the company would cut its sales forecast for the iPhone X by 40% in 5he current quarter, to 30 million units. Apple has not publically disclosed sales forecasts for the phone.
Elsewhere, the stock market was being boosted by a further rise in energy prices and strong gains in oil and oil-related stocks. Commodity prices, in general, are rising, and that should be bullish for going into 2018. In all, the stock market, which seems intent on closing higher for a month in a row--something that has not been done since the days of the Eisenhower Administration in the late 1950s. This mixed early showing stateside followed similarly unprepossessing performance in the overnight hours in Asia and Europe on Christmas night.
The market, which often has strengthened following a weaker opening, did not turn around later yesterday morning. In fact, as we headed toward the noon hour in New York, the three large-cap indexes had all fallen below the breakeven line. Still, there were more gaining stocks than losing equities at that time, with the ratio being almost three-to-two, while eight of the 10 leading sectors remained higher for the session, led by energy. The lone losers were two high-profile groups, which have done well this year, the financial stocks and the technology equities, with the latter under pressure from the aforementioned drop in Apple shares.
The stock market then weakened a little more--especially the Dow--as the afternoon got under way. However, there was not much lasting deterioration, and stocks remained somewhat range-bound, with the blue chip composite off some 30 points, for the most part, as the final two hours of the trading day commenced. As before, the tech sector was being weighed down by losses in Apple, while higher oil prices were giving a boost to the energy stocks. Also, in the news, the retail group was prospering on reports noting strong holiday sales, both in store and over the Internet. For example, Kohl's (KSS) saw its stock jump 6% on the upbeat data.
Equities then firmed up somewhat as we moved further into the concluding hour of this post-Christmas session, with the Dow's and the NASDAQ's losses shrinking somewhat, while the smaller composites held their ground and remained modestly in the win column. It seems that investors are positioning themselves for the new year, either taking profits now or, more likely, waiting until next year to nail down gains, following the major tax changes that are on the way. As before, most of the 10 major equity groups were ahead on the day, led by energy, while gaining stocks still were holding onto a modest advantage.
Then, as the trading day came to an end, there was a slight additional buying flurry in the Dow, which enabled that index to end the session off just eight points. Little, however, changed with the other composites, as they ended as they had traded for much of the day. On point, the NASDAQ's loss remained at 24 points and the Russell 2000 held to a slight gain. Now, a new day begins, and we see that oil is slightly lower and bond yields are up nominally ahead of the key consumer confidence report scheduled for release some 30 minutes into the trading session. As to the U.S. equity futures, they are now pointing to a slightly higher opening. - Harvey S. Katz, CFA