| | | Stocks rise concurrently with longer-dated Treasuries
04-Aug-20 16:20 ET
Dow +164.07 at 26828.47, Nasdaq +38.37 at 10941.24, S&P +11.90 at 3306.51
briefing.com
[BRIEFING.COM] The S&P 500 gained 0.4% on Tuesday to close at session highs in a tight-ranged session, even as negotiations surrounding the next coronavirus relief bill remained deadlocked. The Nasdaq Composite (+0.4%) kept pace with the benchmark index to close at a record high, while the Dow Jones Industrial Average (+0.6%) and Russell 2000 (+0.7%) outperformed.
According to media reports, Treasury Secretary Mnuchin said negotiators are no closer to a deal than a week ago while Senator Perdue (R-GA) estimated that stimulus talks could last an additional two weeks. While discouraging, the broad market was not deterred by the news, as nine of the 11 S&P 500 sectors closed higher.
The energy sector rose 2.5% amid higher oil prices ($41.68/bbl, +0.66, +1.6%), followed by gains in the real estate (+1.4%), utilities (+1.4%), and materials (+1.3%) sectors. The health care (-0.5%) and financials (-0.4%) sectors were the lone holdouts.
Financial stocks were pressured by some curve-flattening activity in the Treasury market, which reflected some growth-related angst given that lawmakers remained divided over stimulus talks. The 2-yr yield increased one basis point to 0.12%, while the 10-yr yield fell five basis points to 0.52%.
Within the tech space, Microsoft (MSFT 213.29, -3.25, -1.5%) cooled off from yesterday's TikTok-driven rally, while Advanced Micro Devices (AMD 85.04, +7.37) surged 9.5% to fresh record highs. AMD shot higher after Jefferies raised its price target on the stock to $95 from $86 on a view that it will capitalize on Intel's (INTC 49.13, +0.83, +1.7%) production issues.
Gold futures ($2020.80/ozt, +$33.80, +1.7%) also rallied to new highs above $2000/ozt. The U.S. Dollar Index declined 0.1% to 93.27 after trading higher in the morning.
Tuesday's economic data was limited to the Factory Orders report for June, which increased 6.2% m/m (Briefing.com consensus 5.2%) following a downwardly revised 7.7% increase (from 8.0%) in May.
- The key takeaway from the report is the affirmation that business spending picked up in June as economies reopened, evidenced by a 3.4% increase in new orders for nondefense capital goods excluding aircraft that was up slightly from the 3.3% increase noted in the Advance Durable Goods Orders report.
Looking ahead, investors will receive the ADP Employment Change Report for July, the Trade Balance report for June, and the weekly MBA Mortgage Applications Index on Wednesday.
- Nasdaq Composite +21.9% YTD
- S&P 500 +2.3% YTD
- Dow Jones Industrial Average -6.0% YTD
- Russell 2000 -9.1% YTD
Market Snapshot
| Dow | 26828.47 | +164.07 | (0.62%) | | Nasdaq | 10941.24 | +38.37 | (0.35%) | | SP 500 | 3306.51 | +11.90 | (0.36%) | | 10-yr Note | +27/32 | 0.504 |
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| | NYSE | Adv 1902 | Dec 1057 | Vol 863.3 mln | | Nasdaq | Adv 1938 | Dec 1288 | Vol 3.9 bln |
Industry Watch
| Strong: Energy, Utilities, Real Estate, Consumer Discretionary |
| | Weak: Health Care, Financials, Information Technology |
Moving the Market
-- Stocks trade mixed, while Treasury market strengthens
-- Little progress on coronavirus relief bill negotiations, according to reports
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Energy stocks follow oil prices higher
04-Aug-20 15:25 ET
Dow +110.91 at 26775.31, Nasdaq +1.19 at 10904.06, S&P +4.61 at 3299.22
[BRIEFING.COM] The S&P 500 is up 0.1%, while the Russell 2000 outperforms with a 0.5% gain.
One last look at the S&P 500 sectors shows energy (+2.4%), materials (+1.7%), utilities (+1.7%), and real estate (+1.3%) in the leadership positions, while the financials (-0.6%), health care (-0.7%), and information technology (-0.2%) sectors still trade lower.
WTI crude futures settled higher by 1.6% (+$0.66) to $41.68/bbl. |
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