After the Close - Stocks turned in a listless session today, save for more notable action in a couple of sectors and some individual names. At the end of the day, the Dow Jones Industrial Average was down 21 points; the S&P 500 slipped nearly a point; the NASDAQ lost three points, and the Russell 2000 small-cap index gave back two points. The broader market fared worse, with decliners handily topping advancers on both the New York Stock Exchange and the NASDAQ.

The lack of bullishness on the part of investors likely stemmed from several factors. One of those may be a pause ahead of Friday’s big employment report, in which the nation is expected to have added 215,000 jobs. Another concern is valuations. Stocks aren’t cheap, and investors trained to buy the dips may well be waiting for another opportunity to snap up comparative bargains. There is also a dose of caution regarding the weak direction Europe seems to be headed in.

Nevertheless, there were clearly some bright spots among the day’s trading. Those included shares of the automakers, such as General Motors (GM) and Ford (F), after the automobile industry reported better-than-expected May sales, especially at the former. Reports pointed to a double-digit increase in sales for May, suggesting a full recovery since the severe 2007-2009 recession.

The upturn in auto sales fits in with the thinking that demand was pent-up following the severe weather this past winter, and provided reason to believe that the U.S. economy was strengthening after some backsliding in the first quarter. 

Other sectors that did well included oil and utilities, in a continuation of the shift to so-called value stocks that has taken place for much of this year.

Elsewhere, shares of companies involved in mergers and acquisitions remained in the news, with Hillshire Brands (HSH) stock climbing sharply Pilgrim’s Pride (PPC) made a higher offer for the food processor than TysonFoods (TSN).

Tomorrow brings a handful of economic reports to consider, with data on the international trade deficit, the nation’s productivity, and the nonmanufacturing (i.e., service) sector on tap. A preliminary report on jobs added in May is also expected from AutomaticDataProcessing (ADP). Whether these figures prove sufficient to arouse investors from an early case of the summer doldrums remains to be seen. – Robert Mitkowski

At the time of this writing, the author did not have positions in any of the companies mentioned. 


12:20 PM EDT - The U.S. stock market opened lower this morning, and has been unable to meaningfully reverse course. At just past noon in New York, the Dow Jones Industrial Average is off 35 points; the broader S&P 500 Index is down four points; and the NASDAQ, which is quite weak, is lower by 14 points. Market breadth shows a negative bias to the session, as declining issues are outnumbering advancers by about two to one on the NYSE. Weakness can be found throughout most of the market sectors. Specifically, the basic materials and industrials stocks are trading notably lower. Nonetheless, the energy issues are in positive territory. Too, the utilities, while down, are showing some relative strength.

In general, stocks have been able to hold their ground recently, as the S&P 500 Index and the Dow Jones Industrials are now near all time highs. However, trading volumes have been light lately, and some stock groups have not participated fully in the recent advance. This may suggest that the market is not as strong as the major averages suggest.

There was little economic news released this morning, and this provided limited encouragement for traders. However, factory orders rose 0.7% in April, coming in just a bit better than had been expected. Orders for computers were quite strong, while demand for motor vehicles were weak. Tomorrow will be a busier day for economic news. The ISM Non-Manufacturing Index for May is due to be released. We are also set to receive that the ADP Employment Change Report for the month of May, as well as the nation’s April Trade Balance report.

Elsewhere, investors received a few corporate news items to mull over. After yesterday’s close, we heard from Krispy Kreme (KKD). That stock is trading lower, after the donut maker posted weaker-than-expected results. Also, things did not go well for Quicksilver (ZQK). That low-price stock is plunging further, as the clothing company posted a wider-than-expected loss. Meanwhile, this morning, Dollar General (DG) posted its figures. That issue is up, as investors remain confident in the retailer’s outlook. Later today, we will hear from Ascena Retail Group (ASNA). - Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned. 


Stocks to Watch from The SurveyThere is some earnings news out today, though much of it was not well received by investors. Indeed, shares of Quiksilver (ZQK) are plunging ahead of the bell, after the action-sports related apparel and accessories company delivered a wider-than-expected loss in the April interim. Restaurant operator Krispy Kreme Doughnuts (KKD) also issued a disappointing release. Earnings were in line with estimates, but revenues were light and management trimmed its guidance. KKD stock is moving notably lower in the premarket, as a result. However, April-period financials from discount retailer Dollar General (DG) were met with a warmer reception on Wall Street, and that stock is up slightly in pre-market trading.

Elsewhere, on the M&A front, shares of Hillshire Brands (HSH) are indicating a nicely higher opening this morning, after the food processing company received a $55-a-share takeover bid from industry peer Pilgram’s Pride (PPC), which topped a competing offer from fellow suitor Tyson Foods (TSN). – Matthew E. Spencer

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.

Before The Bell - The stock market, fresh off of a solid May, which laid to rest at least for one month, the six-month maxim that goes "Sell in May and go away'', started off the new month in likewise bullish form posting a modest and selective gain after some early session slippage, brought on in part, we believe, by the release of initially inaccurate industrial-sector results.

That early weakness, as suggested, was likely engendered by a weaker, and incorrect as it turned out, look at the latest month's manufacturing sector. The report, issued by the Institute for Supply Management (ISM), intoned that its survey registered a reading of 53.2 for last month. Now, the initial report still showed that this sector was expanding, as the result was above the 50.0 border between an expanding and a contracting industrial sector. However, the score was below both the April survey result (54.9) and May's expected tally (55.5).

However, after rumors persisted that this estimate was off target, the ISM went in and corrected the survey to show an actual reading of 55.4. That was, as noted, in line with expectations (55.5) and above both April and the inaccurate early result. The revised data  seemed to give the market a lift, and stocks were soon heading irregularly higher, albeit not aggressively so, with gains in the Dow Jones Industrial Average (up 26 points), the Standard and Poor's 500 Index (ahead by a point and a half), and the S&P Mid-Cap 400 (up nearly four points). However, losses in the NASDAQ (five points) and the small-cap Russell 2000 (six points) persisted, giving the session a rather mixed and indecisive tone. Also, the advance-decline line was not overly bullish, with more decliners than gaining issues, on both the Big Board and the NASDAQ, and that did not lead to more buying as the day progressed. Still, the Dow and the S&P 500 each did set a record during the day, which has been a fairly regular occurrence thus far in 2014. 

The corrected data signaled that the nation's economy is still healing itself following the painful winter experience that saw demand interrupted in both the business and consumer markets and the costs of doing business rising throughout the affected months of January and February, in particular. The reasonably benign start to the month for the economy and the market could be a positive omen for the weeks ahead and, indeed, many market pundits do expect Wall Street to continue rallying for a while. Also, there was some merger-related activity in the news, and that also gave the market an early lift. We are in a heavy business release week and there is still some anxiousness after the distressing winter. Thus, the initially bearish reaction to the inaccurate ISM data. 

As to the rest of the week, as far as the economy is concerned, the news will be headlined today by reports on factory orders, which are due out early in the trading session, and on car sales for May, which will be released throughout the day. Those reports will then be followed by issuances tomorrow on non-manufacturing activity, released by the same ISM, and results on the trade gap front (issued by the Commerce Department), as well as figures on productivity and unit labor costs. Then on Thursday, the government will provide the weekly report on jobless claims, while on Friday, the U.S. Labor Department will provide surveys on non-farm payrolls for May and in a separate survey, data on the unemployment rate for last month. In between, the Federal Reserve will come out tomorrow afternoon with its Beige Book summary of recent U.S. economic activity.             

As to other news, yesterday's slightly aggregate stock market saw uneven performances by the basic materials groups, with the aluminums (notably Alcoa, (AA)) pressing higher, while some prominent steels, including Nucor (NUE) and U.S. Steel (X) worked their way modestly lower. Also, the financials and the big drug stocks were suitably mixed, ahead of what will be a busy week for both economic tidings and Federal Reserve assessments. 

Looking out to a new day, now, we see that the stock markets in Asia were mostly lower overnight, save for Japan's Nikkei, which rose once again. Meantime, in Europe, the major bourses are all pressing lower at this time, as skittish investors wait for the European Central Bank meeting. Hopes there are that the ECB will bring in new monetary easing measures. Finally, on our shores, the early read on the equity futures is notably lower, as some investors here might be getting a bit nervous given the rarified air in which stocks are now trading. Or this weakness could simply be a prelude to a Monday-Tuesday reversal. Stay tuned.     

At the time of this article's writing, the author did not have positions in any of the companies mentioned.