Stock Market Today: October 11, 2019

After The Close

The stock market opened sharply higher this morning, extended its early gains through much of the afternoon, but then softened into the close. Of note, earlier today, Wall Street seemed optimistic that some progress would result from the current round of negotiations taking place between the United States and China. Later in the day, it was reported that some positive steps had actually been achieved. By the end of the session, the Dow Jones Industrial Average was up nearly 320 points; the broader S&P 500 Index was ahead 32 points; and the NASDAQ was higher by 106 points.

Market breadth showed widespread support for equities today, as winners outnumbered losers by an overwhelming margin on the NYSE. All of the major market sectors forged ahead, with notable strength in the industrial, technology, and basic materials issues. In contrast, the defensive utility names lagged the other sectors, as traders seemed willing to move capital into more dynamic stocks.

There were just a few economic reports released today. Specifically, export prices dipped 0.2%, while import prices rose 0.2%, during the month of September. These numbers did not comes as much of a surprise. Meanwhile, the University of Michigan’s Consumer Sentiment Index registered a preliminary reading of 96.0 for the month of October, which was a solid showing.

In the corporate arena, it was a relatively quiet day for reports. However, we did hear from Fastenal (FAST). Shares of the construction products company were up sharply in response to a better-than-anticipated release. Looking ahead, the third-quarter earnings season will soon be in full swing. Early next week, many large banks and financial companies are slated to weigh in with their numbers.

Technically, the stock market came roaring back today, putting the S&P 500 Index not too far from the 3,000 level. The bulls seem to be back in control, for now, but looking ahead Wall Street will likely want to see that progress is being made on the trade front, as well as some upbeat earnings reports.

– Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.

12:05 PM EDT

The President has intoned that good things are happening in the trade talks with China, and the bulls are running with those comments and driving the stock market sharply higher as the traders ready themselves for the lunch hour on Wall Street. In fact, as the noon hour approaches, the Dow Jones Industrial Average is knocking on the door of a 500-point advance.

And it is not just the Dow, which is up 1.8%, but the S&P 500, which is ahead by 51 points (also 1.8%), and the NASDAQ, which is surging by 133 points (or 2.0%) that are fueling the rally. All arrows are green as gaining stocks are overwhelming declining issues as the morning concludes.

To be sure, we are not talking of a wide-ranging deal on trade with China, but rather a limited accord. Still, is such a partially satisfactory outcome emerges, the increases in tariffs promised by the United States might not occur. Our economy, which is under some increased pressure these days, would clearly get relief should tariffs not go higher.     

The President's comments that the talks are going well has sparked solid gains in the tech sector, which explains the NASDAQ's strength, and particularly the chip arena. Meanwhile, in addition to the good trade news, the market also is getting a lift as the University of Michigan Consumer Sentiment Index came in higher than expected this morning.

– Harvey S. Katz, CFA

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.

Before The Bell