After The Close - The U.S. stock market put in a choppy performance today. Specifically, the major averages moved nicely higher by late morning, but pulled back around midday, ending the session on a mixed note. At the close of trading, the Dow Jones Industrial Average was down 32 points; the broader S&P 500 Index was unchanged; and the NASDAQ was higher by 20 points. Market breadth was favorable, for the most part, as winners were ahead of losers on the NYSE. From a sector perspective, the basic materials issues assumed the leadership position today. The consumer cyclical issues and healthcare names also made progress. However, the energy and utility stocks lagged the broader market.
Traders received just one economic news item today. Of note, wholesale inventories rose 1.0% during the month of November, compared to the slight decline posted in October. Tomorrow will also be a light day for economic reports. However, the pace will pick up on Thursday, as the December import and export prices are released. In addition, the latest weekly initial jobless claims numbers are due to out, which may provide information about the nation’s employment situation. This report may interest traders, as the job market is watched closely by the Federal Reserve as it looks to set policy.
In the corporate arena, few companies delivered their results over the past 24 hours. However in the technology space, we heard from Barracuda Networks (CUDA). That issue advanced slightly in response to a solid report. Elsewhere, things should soon get quite a bit busier, as the fourth-quarter earnings season will soon start up. Perhaps, as investors get a better sense of the situation, the market, which was quite volatile today, will take on a more definitive course. - Adam Rosner
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
12:00 PM EST - After a modest setback yesterday, on a sparse day of news for the economy, the bears began the current session in similarly underwhelming fashion, with the major averages all trending lower at the start. However, once again the early losses were rather incidental, with the Dow Jones Industrial Average, after failing once more to push past 20,000 yesterday, easing by some 50 points in the first few minutes of trading.
But once the sellers could really not get going, the bulls entered the fray, hesitantly at first, but now with a little more enthusiasm. Thus, as we move through the latter stages of the morning in New York, we see that the major equity averages are all comfortably in the plus column, raising hopes that after the Dow seemingly troughed at 19,836 earlier today, that a move up to the thus far elusive 20,000 level might yet be at hand later today or at some point this week.
As to influences on the markets in the present session, the big story, after this past Friday's ho-hum jobs report and ahead of the end-of-month Federal Open Market Committee meeting, is the pending release of fourth-quarter earnings reports,. The results will be led later this week by Dow component JPMorgan Chase (JPM - Free JPMorgan Chase Stock Report). The beat will then pick up over the next two weeks as hundreds of large, high-profile companies will issue their latest results and guidance for 2017.
As to the market at this juncture, the buying spurt in late morning has the Dow now up 47 points, the S&P 500 Index ahead by seven points, and the NASDAQ, which rose yesterday and is at one more record high, better by 28 points. The latest multi-session spurt on the NASDAQ now has that composite modestly above 5,550. In the meantime, the stock market's latest spurt has the Big Board now showing about twice as many gaining stocks as losing issues.
Breaking the market's advance down, we see that seven of the 10 leading equity sectors are now advancing, led by a near two-percent gain in the basic materials group. The other nine groups are showing just incremental changes, with the financials notably reversing course from an early morning setback to a modest uptick at present. Among the latter components, we see a nice gain now in shares of Bank of America (BAC). However, a key member of the financial services group, Goldman Sachs (GS - Free Goldman Sachs Stock Report) is still under some pressure.
Finally, in other news, on this otherwise quiet day for the economy, U.S Treasuries are up slightly, with the yield on the benchmark 10-year Treasury note falling to 2.37%. Also, wholesale inventories rose 1% in the latest month, which was slightly above estimates. However, that was not a market moving report. So, as we stand now, the market could be ready to make yet one more move on Dow 20,000. Stay tuned. - Harvey S. Katz
At the time of this article's writing, the author did not have positions in any of the companies mentioned.
Before The Bell - After narrowly missing 20,000 on the Dow Jones Industrial Average on Friday, with the bulls actually coming within less than a point of that much-anticipated record-high figure, that 30-stock composite fell back some 70 points in early trading yesterday in some obvious profit taking after its long run to fresh high ground. But this incremental dip ahead of the kickoff to fourth-quarter earnings season had little to it, and most of the gains secured after the Presidential election were still intact.
Even with the early pullback, as noted, the stock market retains most of the strength generated over the past two months, as hopes persist President-Elect Trump will support policies that will accelerate economic growth. Such policies are expected to include tax cuts and increased infrastructure spending, assuming that Congress goes along with the proposals. Meantime, even before this morning setback, the market had shown some signs of plateauing, as the Dow had knocked on the door of 20,000 several times.
As to yesterday's market, there appeared to be some nervousness ahead of reporting season, which this week will feature issuances from Dow component JPMorgan Chase (JPM - Free JPMorgan Stock Report) and from former Dow member Bank of America (BAC). Such uneasiness aside, the selling ebbed as the morning rolled on, as the bears couldn't mount a sustained effort to take stocks lower. In fact, as we neared the noon hour in New York, the NASDAQ was already in positive territory and the Dow's loss had been pared notably.
However, the stock market's attempt at a mid-session recovery stalled as the afternoon got under way, and the Dow weakened some in the early-to-mid-afternoon hours. However, the NASDAQ's strength increased and the small morning uptick gained notably on strength in the technology sector. Then, after meandering about with a loss in the Dow of some 30 to 50 points, that 30-stock composite weakened into the close, with stocks ending matters near the day's low.
In all, buffeted by last-minute selling, the Dow fell further from 20,000, ending matters at 19,887. That close meant that the index had fallen 76 points. The S&P 500 ended off eight points, but the NASDAQ, on the strength in tech, especially in some high-profile names, wound up ahead by 11 points, about half its mid-session gain. However, the small-cap-weighted Russell 2000 fell 10 points. Among other groups, oil stocks weakened on falling crude prices; retailers also fell once more.
Looking ahead to a new day now, we find that stocks in Asia were weaker overnight, while the bourses are mixed in Europe so far this morning. It is much the same story here, with our futures showing little direction on a day that like yesterday will feature little in the way of hard economic news. Meantime, oil prices are creeping a little higher and that should prove supportive. But for now, especially with the monthly jobs report out of the way and the next Fed meeting still a few weeks off, the immediate focus will be on earnings. So, stray tuned. - Harvey S. Katz