Market Snapshot
briefing.com
| Dow | 35028.65 | -339.82 | (-0.96%) | | Nasdaq | 14340.25 | -166.64 | (-1.15%) | | SP 500 | 4532.76 | -44.35 | (-0.97%) | | 10-yr Note | +4/32 | 1.834 |
|
| | NYSE | Adv 1016 | Dec 2292 | Vol 942.1 mln | | Nasdaq | Adv 1443 | Dec 2879 | Vol 4.6 bln |
Industry Watch
| Strong: Consumer Staples, Utilities |
| | Weak: Financials, Consumer Discretionary, Information Technology |
Moving the Market
-- Investors sell into early strength and market closes at session lows in weak finish
-- Inability to rebound with lower interest rates and encouraging earnings news
-- Selling momentum
|
Stocks close lower in disappointing session
19-Jan-22 16:20 ET
Dow -339.82 at 35028.65, Nasdaq -166.64 at 14340.25, S&P -44.35 at 4532.76
[BRIEFING.COM] The S&P 500 fell 1.0% on Wednesday, fading an early 0.8% gain despite encouraging earnings news and a decline in interest rates. The Nasdaq Composite (-1.2%) and Dow Jones Industrial Average (-1.0%) performed comparably to the benchmark index, while the Russell 2000 lagged with a 1.6% decline.
Nine of the 11 S&P 500 sectors closed lower, as selling interest accelerated into the close on no specific news. The consumer discretionary (-1.8%), financials (-1.7%), and information technology (-1.4%) sectors led the retreat, while the consumer staples (+0.7%) and utilities (+0.5%) sectors closed higher.
Early on, there was optimism surrounding the EPS beats from Procter & Gamble (PG 162.00, +5.27, +3.4%), UnitedHealth (UNH 462.52, +1.53, +0.3%), Bank of America (BAC 46.44, +0.18, +0.4%), and Morgan Stanley (MS 95.74, +1.73, +1.8%) insofar that they signaled more companies would successfully navigate the higher-cost business environment.
At the same time, interest rates had backed off from overnight highs and continued to push lower throughout the session. It looked like a good set-up for an equity rebound, but unfortunately, that didn't happen. The inability to rebound from sizable losses deterred risk sentiment, fueling a belief that more downside was ahead.
Presumably, investors bought the dip in Treasuries to hide out from the equity volatility, geopolitical uncertainty, and any impact from the Fed's tightening plans. As a reminder, the Fed meets next week to discuss monetary policy.
The 2-yr yield declined two basis points to 1.01% after flirting with 1.08% overnight, and the 10-yr yield declined four basis points to 1.83% after flirting with 1.90% overnight. The U.S. Dollar Index declined 0.2% to 95.56. WTI crude futures approached $87.00 per barrel ($86.86/bbl, +1.38, +1.6%).
Interestingly, homebuilding stocks were noticeably weak despite housing starts and building permits for December beating expectations. There might have been some disappointment that the increases were driven by multi-unit dwellings instead of single-unit dwellings.
The iShares US Home Construction ETF (ITB 71.73, -1.88) fell 2.6%, additionally pressured by KeyBanc Capital Markets downgrading several stocks in the space.
Reviewing Wednesday's economic data:
- Housing starts increased 1.4% month-over-month in December to a seasonally adjusted annual rate of 1.702 million (Briefing.com consensus 1.650 million) while permits increased 9.1% month-over-month to 1.873 million (Briefing.com consensus 1.702 million).
- The key takeaway from the report is that the increases were driven by multi-unit dwellings. Single-unit starts were down 2.3% and single-unit permits were up just 2.0% with little to no growth in the two largest homebuilding regions (the South and the West).
- The weekly MBA Mortgage Applications Index increased 2.3% following a 1.4% increase in the prior week.
Looking ahead, investors will receive the weekly Initial and Continuing Claims report, Existing Home Sales for December, and the Philadelphia Fed Index for January on Thursday.
- Dow Jones Industrial Average -3.6% YTD
- S&P 500 -4.9% YTD
- Russell 2000 -8.1% YTD
- Nasdaq Composite -8.3% YTD
Crude futures settle above $86 per barrel
19-Jan-22 15:30 ET
Dow -163.63 at 35204.84, Nasdaq -72.16 at 14434.73, S&P -16.73 at 4560.38
[BRIEFING.COM] The S&P 500 is down 0.2%, and the Russell 2000 is down 0.8%.
One last look at the sectors performances shows consumer discretionary (-1.2%) and financials (-1.0%) down at least 1.0%, while the consumer staples (+1.2%) and utilities (+1.0%) sectors are both up at least 1.0%.
WTI crude futures settled higher by 1.6%, or $1.38, to $86.86/bbl. |
