Market Snapshot
briefing.com
| Dow | 30509.88 | -882.91 | (-2.81%) | | Nasdaq | 10817.99 | -522.03 | (-4.60%) | | SP 500 | 3752.49 | -148.37 | (-3.80%) | | 10-yr Note |
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| | NYSE | Adv 169 | Dec 3049 | Vol 718 mln | | Nasdaq | Adv 605 | Dec 3787 | Vol 4.7 bln |
Industry Watch
| Strong: -- |
| | Weak: Energy, Consumer Discretionary, Real Estate, Information Technology, Materials, Utilities, Communication Services |
Moving the Market
-- General growth concerns
-- Treasury note yield curve flattening on rate-hike worries
-- Cryptocurrency market taking a big hit after Celsius freezes asset withdrawals and transfers
-- Downside leadership from mega caps
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Closing Summary
13-Jun-22 16:25 ET
Dow -876.05 at 30516.74, Nasdaq -530.80 at 10809.22, S&P -151.23 at 3749.63
[BRIEFING.COM] Last week ended on a bad note, and the new week started on an even worse note. There were myriad concerns in today's trading mix that drove the Dow, Nasdaq, and S&P 500 to new 52-week lows and the S&P 500 back into bear market territory.
The troubling writing was on the wall for both the Treasury market and the stock market. The former got clobbered on rate-hike concerns while the latter got clobbered on a combination of rate-hike concerns and growth concerns.
By and large, both markets got knocked out today with repeated jabs of selling interest.
The 2-yr note yield settled the day up 23 basis points at 3.27%, and then climbed as high as 3.43% following the close of the cash session when The Wall Street Journal reported that the Fed is apt to consider a 75-basis point rate hike at this week's FOMC meeting given the bad inflation report seen last Friday. Similarly, the 10-yr note yield settled the day up 21 basis points at 3.37%, and also went to 3.43% following the close of the cash session.
There had already been concerns about the Fed taking a more aggressive rate-hike path, yet the timing of the article, and the source, lent some credence to the idea that the Fed could possibly "surprise" the market this week. That's not a given, but it is intended to explain why there was some knee-jerk selling interest late in the day following the report.
Stocks had already been struggling with the jump in yields, but they cascaded to new session lows, or close to session lows, in the final hour in a move that coincided with the extra spike in Treasury yields following the report.
It was a fitting end to a day where most stocks were treated like punching bags. The body blows came early, and were firing on the following influences:
- Worries about the Fed taking a more aggressive rate-hike path to fight inflation.
- Reports of renewed lockdowns/shutdowns in Shanghai and Beijing due to the detection of new COVID cases.
- A lack of confidence in valuations given that forward earnings estimates have yet to be cut in any meaningful way despite expectations for much slower growth and/or a recession in coming months.
- Massive losses for cryptocurrencies coinciding with news that crypto lender Celsius has paused customer withdrawals and transfers due to "extreme market conditions."
- As of this writing, Bitcoin was down 15.5% to $23,212.40 while Ethereum was down 17.2% to $1228.22.
- General growth concerns tied to rising interest rates and a flattening yield curve.
- Nervousness about forced selling due to margin calls.
The advance-decline line told the tale of a market lacking any strong buying interest. Declining issues outpaced advancing issues by by a 16-to-1 margin at the NYSE (that spread was 23-to-1 shortly after the open) and by a 7-to-1 margin at the Nasdaq (that spread was 11-to-1 shortly after the open).
All 11 S&P 500 sectors closed with losses that ranged from 2.2% (consumer staples) to 5.1% (energy). Nine of the 11 sectors fell at least 3.0%. The Vanguard Mega-Cap Growth ETF (MGK) dropped 4.5% while the Invesco S&P 500 Equal Weight ETF (RSP) fell 4.0%. The Russell 3000 Growth Index declined 4.5% and the Russell 3000 Value Index declined 3.8%.
In sum, it was a day where nothing worked outside of some individual stocks with company-specific news catalysts, like Duke Realty (DRE 50.32, +0.54, +1.1%), which is going to be acquired by Prologis (PLD 108.35, -8.89, -7.6%) in a $26 billion all-stock deal.
Reflecting the nervous state of the market, the CBOE Volatility Index surged 23.9% to 34.39.
There was no economic data of note today. Looking ahead, market participants will receive the May NFIB Small Business Optimism Index (6:00 a.m. ET) and May Producer Price Index report (8:30 a.m. ET) on Tuesday.
- Dow Jones Industrial Average: -16.4% YTD
- S&P 400: -19.3% YTD
- S&P 500: -21.3%
- Russell 2000: -23.6% YTD
- Nasdaq Composite: -30.9%
Treasury yields continue to climb
13-Jun-22 15:30 ET
Dow -882.91 at 30509.88, Nasdaq -522.03 at 10817.99, S&P -148.37 at 3752.49
[BRIEFING.COM] The indices are trolling near session lows heading into the close. The move back to lows has coincided with another spike in Treasury yields following a Wall Street Journal report that suggests the Fed will have to consider a 75 basis point rate increase at this week's meeting following Friday's worrisome CPI report.
The 2-yr note yield is up to 3.40% while the 10-yr note yield has climbed to 3.42%. The CBOE VIX Index meanwhile is up 20.5% to 33.45.
Looking ahead to Tuesday, market participants will receive the following economic data:
- 6:00 ET: NFIB Small Business Optimism
- 8:30 ET: PPI (Briefing consensus 0.8%) and core PPI (Briefing.com consensus 0.6%) which excludes food and energy
Consumer discretionary sector is the top laggard
13-Jun-22 14:55 ET
Dow -713.37 at 30679.42, Nasdaq -451.57 at 10888.45, S&P -126.41 at 3774.45
[BRIEFING.COM] The major indices have continued moving mostly laterally with some volatility in the mix. While the indices are off their lows, there still hasn't been much of a rush to buy the weakness with the FOMC decision looming on Wednesday.
The consumer discretionary sector (-4.3%) is currently the biggest laggard with energy (-4.2%) right behind. Only two components of the consumer discretionary sector trade in the green, Dollar Tree (DLTR 156.31, +0.31, +0.2%) and Dow component McDonald's (MCD 239.02, +1.64, +0.7%).
The biggest sector laggards are cruise lines Norwegian Cruise Line (NCLH 11.63, -1.54, -11.7%) and Carnival Corp. (CCL 9.90, -1.15, -10.4%), as well as casinos Caesars Entertainment (CZR 40.24, -5.26, -11.7%) and MGM Resorts (MGM 58.93, -2.85, -9.0%).
Duke Realty outperforms after Prologis offers to combine
13-Jun-22 14:30 ET
Dow -713.03 at 30679.76, Nasdaq -431.30 at 10908.72, S&P -121.22 at 3779.64
[BRIEFING.COM] The S&P 500 (-3.11%) sits firmly in second place, having moved mostly sideways in the last half hour.
S&P 500 constituents Penn Natl Gaming (PENN 29.15, -3.03, -9.42%), United Airlines (UAL 37.40, -3.76, -9.14%), and Paramount Global (PARA 25.94, -2.15, -7.65%) dot the bottom of today's action. PENN lags alongside other consumer discretionary (-4.08%) names, while UAL and PARA fall along with broader market weakness.
Meanwhile, Indiana-based REIT Duke Realty (DRE 50.89, +1.11, +2.23%) outperforms after peer Prologis (PLD 109.58, -7.66, -6.53%) offered to combine with the company.
Gold falls to three-week lows amid dollar, yield gains
13-Jun-22 14:00 ET
Dow -593.12 at 30799.67, Nasdaq -388.55 at 10951.47, S&P -105.92 at 3794.94
[BRIEFING.COM] Up-and-down action continued in the major averages in the last half hour, though the tech-heavy Nasdaq Composite (-3.43%) still remains at the bottom of the pile. To be clear, all three major averages trimmed their daily losses in the last 30 minutes, but only just so.
Gold futures settled $43.70 lower (-2.3%) to $1,831.80/oz, a more than three-week low, and yield and dollar gains applied pressure.
Meanwhile, the U.S. Dollar Index is up approx. +0.7% to $104.83.
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