Market Snapshot
briefing.com
| Dow | 34326.46 | +482.54 | (1.43%) | | Nasdaq | 14566.70 | +118.12 | (0.82%) | | SP 500 | 4357.04 | +49.50 | (1.15%) | | 10-yr Note | +24/32 | 1.468 |
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| | NYSE | Adv 2238 | Dec 975 | Vol 912.2 mln | | Nasdaq | Adv 2643 | Dec 1608 | Vol 4.6 bln |
Industry Watch
| Strong: Energy, Communication Services, Materials, Financials |
| | Weak: Utilities, Health Care |
Moving the Market
-- Investors nibbled back into the market at the end of a rough week
-- Merck (MRK) announced promising data for its investigational COVID-19 oral antiviral
-- September ISM Manufacturing Index was better than expected, PCE Prices remained elevated in August
-- 10-yr yield retraced below 1.50%
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Positive end to a negative week
01-Oct-21 16:20 ET
Dow +482.54 at 34326.46, Nasdaq +118.12 at 14566.70, S&P +49.50 at 4357.04
[BRIEFING.COM] The S&P 500 advanced 1.2% on Friday, ending a rough week on a high note amid dip-buying efforts, encouraging news out of Merck (MRK 81.45, +6.34, +8.4%), and hopeful-sounding infrastructure headlines. The Dow Jones Industrial Average (+1.4%) and Russell 2000 (+1.7%) outperformed while the Nasdaq Composite rose 0.8%.
The session started with an early morning fade into negative territory on no specific news, but the market steadily rebounded throughout the day. The S&P 500 energy (+3.3%), communication services (+1.8%) and materials (+1.6%) sectors led the advance with decent gains, while the utilities sector (-0.04%) closed fractionally lower.
In the health care sector (+0.1%), Merck (MRK) announced positive data for its COVID-19 oral antiviral with immediate plans to seek emergency use authorization from the FDA. The antiviral reduced the risk of hospitalization or death by approximately 50% for patients with mild or moderate disease.
While the news was good for Merck, and cyclically-oriented stocks, it undercut shares of vaccine makers. Notably, Moderna (MRNA 341.09, -43.77, -11.4%) and Novavax (NVAX 181.99, -25.32, -12.2%) dropped 11-12%.
In Washington, President Biden visited Capitol Hill to try to get Democrats on the same page regarding his economic agenda. Progressive leader Rep. Pramila Jayapal (D-WA) said both sides were making progress on the larger reconciliation package, according to CNBC.
Dip-buying efforts also made their way to the Treasury market, even as the September ISM Manufacturing Index came in better than expected with a reading of 61.1% (Briefing.com consensus 59.5%) and the core-PCE Price Index for August reached a 30-year high (3.6% yr/yr). The latter was up 0.3% m/m (Briefing.com consensus +0.2%).
The 10-yr yield retraced six basis points to 1.47% while the 2-yr yield retraced three basis points to 0.26%. The U.S. Dollar Index decreased 0.2% to 94.04. WTI crude futures increased 1.1%, or $0.80, to $75.87/bbl.
Separately, Amazon.com (AMZN 3283.26, -1.78, -0.1%), Alphabet (GOOG 2729.25, +63.94, +2.4%), and Facebook (FB 343.01, +3.62, +1.1%) were initiated with Outperform ratings at RBC Capital Mkts. Zoom Video (ZM 267.56, +6.06, +2.3%) and Five9 (FIVN 167.26, +7.52, +4.7%) terminated their merger agreement.
Reviewing Friday's big batch of economic data:
- Personal income increased 0.2% month-over-month in August (Briefing.com consensus +0.2%) and personal spending increased 0.8% (Briefing.com consensus +0.7%). The PCE Price Index was up 0.4% month-over-month, leaving it up 4.3% year-over-year (a 30-year high), and the core PCE Price Index was up 0.3% (Briefing.com consensus +0.2%), leaving it up 3.6% year-over-year (a 30-year high).
- The key takeaway from the report was the recognition that real disposable personal income declined 0.3%, showing the effects of inflation and underscoring that consumers spent out of savings to drive the increase in personal spending. The personal savings rate fell to 9.4% from 10.1%.
- The September ISM Manufacturing Index checked in at 61.1% (Briefing.com consensus 59.5%), up from 59.9% in August. A number above 50.0% is indicative of expansion. September marked the 16th straight month of expansion for the manufacturing sector.
- The key takeaway from the report is still the same. Demand is strong, but manufacturers and suppliers continue to struggle to meet increasing demand levels due to a range of factors that includes record-long raw material lead times, shortages of basic materials, transportation difficulties, worker absenteeism, and difficulty filling positions.
- The final print for the University of Michigan's Index of Consumer Sentiment was bumped up to 72.8 (Briefing.com consensus 71.0) from the preliminary reading of 71.0. The final reading for August was 70.3. In September 2020, the Index of Consumer Sentiment stood at 80.4.
- The key takeaway from the report is the finding that consumers are postponing purchase activity, particularly for higher-priced homes, vehicles, and durables, on a belief that price spikes will be transient. A decline in real income expectations is also feeding the potential for reduced spending activity in coming months.
- Total construction spending was flat m/m in August (Briefing.com consensus +0.4%) following an unrevised 0.3% increase in July.
- The key takeaway from the report is the decline seen in new single family and multifamily construction. That is most likely the consequence of ongoing supply chain pressures.
- The final IHS Market Manufacturing PMI for September checked in at 60.7, up from 60.5 in the preliminary reading.
Looking ahead, investors will receive Factory Orders for August on Monday.
- S&P 500 +16.0% YTD
- Russell 2000 +13.5% YTD
- Nasdaq Composite +13.0% YTD
- Dow Jones Industrial Average +12.2% YTD
Crude futures settle higher
01-Oct-21 15:25 ET
Dow +590.89 at 34434.81, Nasdaq +141.73 at 14590.31, S&P +61.46 at 4369.00
[BRIEFING.COM] The S&P 500 is up 1.4% to trade at fresh session highs. The benchmark index has reduced its weekly decline to 1.9%.
One last look at the sectors shows green across the board. The energy (+3.4%), financials (+2.2%), communication services (+2.1%), and materials (+2.0%) sectors are up at least 2.0%. The health care sector underperforms on a relative basis with a 0.4% gain.
WTI crude futures settled higher by 1.1%, or $0.80, to $75.87/bbl.
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