After The Close
The stock market managed to make some progress during the morning, but softened as the day drew to a close. For the most part, investors were busy sifting through the latest batch of earnings reports, while looking at the broader corporate outlook. At the end of trading, the major averages closed in negative territory. The Dow Jones Industrial Average was down 39 points; the broader S&P 500 Index was off 11 points; and the NASDAQ was lower by 59 points. Market breadth was mixed, with advancers about even with decliners on the NYSE. From a sector perspective, the industrial names and basic materials issues moved higher, while the technology stocks weighed heavily on the market.
Meanwhile, just one notable economic report was released today. Specifically, existing home sales dipped to 5.38 million units, annualized, during the month of September. Analysts had been looking for a slightly higher figure. For investors watching the housing market, the new home sales numbers will be released on Thursday.
In the corporate arena, the third-quarter earnings season continues. Among the widely-watched companies, shares of Hasbro (HAS) lost ground today. The toymaker posted disappointing results, as strained trade relations with China put a damper on business. Furthermore, shares of McDonald’s (MCD – Free McDonald’s Stock Report) moved lower, after the fast-food restaurant operator logged weaker-than-anticipated numbers. Elsewhere, Biogen (BIIB) stock surged in price, after the biotechnology giant delivered a respectable report, and announced plans to advance a drug for the treatment of Alzheimer’s disease.
Technically, today’s selling puts the S&P 500 Index just below the 3,000 mark. No doubt, this will be a key level to watch in the coming days.
– Adam Rosner
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
Before The Bell
The stock market opened the trading week on a slightly firmer note yesterday morning, following a steep selloff on Friday, as optimism returned on the trade front and continued to a degree on corporate earnings for the third quarter. But most of the early strength was reflected in solid gains on the tech-laden NASDAQ, which after the first two hours of trading was up by better than 60 points. The S&P 500 Index also pushed ahead strongly, adding some 17 points during that two-hour span.
But it was another story for the Dow Jones Industrial Average. That index was in and out of the red throughout the morning, finally edging into the plus column as we approached the noon hour, albeit most gingerly. Helping the stock market through much of the early going was optimism on trade after the United States and China showed some signs of progress in bridging their differences. Upbeat comments from the White House suggesting that a deal could be signed off within a month helped sentiment.
On the other hand, shares of beleaguered aircraft maker Boeing (BA - Free Boeing Stock Report) fell again, putting that stock, a component of the Dow, on track for its worst two-day fall in more than a decade after multiple brokerage houses were critical of the issue. In all, the stock was off 14 points, or more than 4% in late morning, bringing considerable pressure on the Dow Industrials. Even with the Dow's sluggishness, the overall trend in the market was positive, with more than twice as many stocks rising as falling in price as the noon hour arrived in New York.
The upbeat tone would extend into the early afternoon, with the Dow joining the higher parade as we moved a bit further into the session with its gain passing the 50-point plateau, while the NASDAQ was better by some 70 points, as the halfway point of the session was reached. The Dow, up grudgingly to that point, then would remain in the green through the balance of the session, weaving slowly higher on that selective optimism. As for earnings, they are doing fairly well, but not dramatically so.
This advance would, as noted, persist into the close. And when all of the tallies were in, the Dow would be higher by 57 points. But while that was near the day's high, it also trailed the gains in the NASDAQ, the Russell 2000, and the S&P 500. Overall, it was a constructive session, led by the technology group, a category that would stand to do quite well should a meaningful trade accord be inked with China. As for this group, the big winner on the day would be shares of Apple Inc. (AAPL - Free Apple Stock Report). That issue, in fact, climbed to an all-time high yesterday.
Now, a new day begins, and we look across to Asia, where equities are nicely higher in overnight dealings on trade deal hopes. Meantime, in Europe, the leading bourses are more mixed so far this morning. In other markets, oil prices are edging upward; Treasury yields are slightly lower; and U.S. equity futures point to an unprepossessing start to the session.
– Harvey S. Katz, CFA
At the time of this article’s writing, the author held positions in one or more of the companies mentioned.
