Stock market closes little changed, retail space hit
19-Nov-19 16:20 ET
Dow -102.20 at 27933.93, Nasdaq +20.72 at 8570.66, S&P -1.85 at 3120.18
briefing.com
[BRIEFING.COM] The S&P 500 declined 0.1% on Tuesday in a mixed session. The retail industry was under pressure following disappointing quarterly results and guidance from Home Depot (HD 225.86, -12.99, -5.4%) and Kohl's (KSS 47.02, -11.38, -19.5%).
The Dow Jones Industrial Average (-0.4%) also finished lower, while the Nasdaq Composite (+0.2%) and Russell 2000 (+0.4%) finished higher. The Nasdaq closed at another record high.
The session began with each of the large-cap indices setting intraday highs despite the negative sentiment in the retail space. The early advance quickly faltered but overall losses were modest, and transient, as the S&P 500 only dipped 0.3% below its flat line before buyers quickly stepped in to buy the dip.
The retail space didn't benefit from an opportunistic mindset, though, as the SPDR S&P Retail ETF (XRT 43.95, -0.87, -1.9%) finished near its lows like the S&P 500 energy (-1.5%) and consumer discretionary (-1.0%) sectors. Home Depot dragged on the consumer discretionary sector while a 3% drop in WTI crude ($55.21, -1.84, -3.2%) weighed on the energy space.
Gains were mainly found in the heavily-weighted S&P 500 health care (+0.7%), information technology (+0.2%), and financials (+0.2%) sectors. The real estate sector (+0.2%) also finished in positive territory.
TJX Companies (TJX 60.64, +1.09, +1.8%) was a bright spot among the retailers after it beat top and bottom-line estimates and raised its full-year guidance. TJX likely tempered some concerns about U.S. consumer spending for the holiday shopping season that may have been engendered by Home Depot and Kohl's.
Separately, shares of AT&T (T 38.00, -1.63, -4.1%) pulled back 4% after the stock was downgraded to Sell from Neutral at MoffettNathanson. Shares of Slack (WORK 21.18, -1.93, -8.4%) sold off on news that Microsoft's (MSFT 150.39, +0.05, unch) competitive product, Teams, increased daily active users by nearly 50% since July.
The U.S. Treasury market was relatively quiet, but demand for longer-dated bonds contributed to some curve-flattening activity. The 2-yr yield was unchanged at 1.59%, and the 10-yr yield declined two basis points to 1.79%. The U.S. Dollar Index increased 0.1% to 97.85.
Tuesday's economic calendar was limited to Housing Starts and Building Permits for October:
- Total housing starts increased 3.8% m/m to a seasonally adjusted annual rate of 1.314 million (Briefing.com consensus 1.300 million) while total building permits increased 5.0% m/m to a seasonally adjusted annual rate of 1.461 million (Briefing.com consensus 1.365 million).
- There was a sizable jump in starts (+8.6%) and permits (+8.2%) for multi-unit dwellings, yet the key takeaway from the report is that starts (+2.0%) and permits (+3.2%) increased for single-family units in an inventory-constrained environment for single-family homes.
Looking ahead, the FOMC Minutes from the October 30-31 meeting and the weekly MBA Mortgage Applications Index will be released on Wednesday.
- Nasdaq Composite +29.2% YTD
- S&P 500 +24.5% YTD
- Dow Jones Industrial Average +19.8% YTD
- Russell 2000 +18.5% YTD
Market Snapshot
| Dow | 27933.93 | -102.20 | (-0.36%) | | Nasdaq | 8570.66 | +20.72 | (0.24%) | | SP 500 | 3120.18 | -1.85 | (-0.06%) | | 10-yr Note | +3/32 | 1.784 |
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| | NYSE | Adv 1351 | Dec 1507 | Vol 842.4 mln | | Nasdaq | Adv 1806 | Dec 1278 | Vol 2.1 bln |
Industry Watch
| Strong: Health Care, Information Technology, Real Estate, Financials |
| | Weak: Consumer Discretionary, Energy |
Moving the Market
-- Stock market closes mixed; weakness in the retail space
-- Home Depot (HD), Kohl's (KSS) disappoint with quarterly results and guidance
-- Relative strength in the health care sector
-- WTI crude drops 3%, weighs on energy stocks
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