After the Close
The U.S. stock market meandered about through much of the day, ending the session on a softer note. At the close of trading, the Dow Jones Industrial Average was down 65 points; the broader S&P 500 Index was off five points; and the NASDAQ was down nominally. Market breadth showed a favorable bias to the session, with advancers ahead of decliners on the NYSE. The major equity groups were weaker on balance, having softened late in the day, as the session and quarter came to a close.
The economic news issued this morning was reasonably constructive, but probably did not influence traders too much. Specifically, personal incomes rose 0.4% in February, while spending increased 0.1% during month. These figures were largely in line with the consensus view. Elsewhere, the Chicago PMI provided a reading of 57.7 for the month of March, which was a bit better than had been expected. Finally, the University of Michigan’s consumer sentiment survey was finalized at 96.9 for the month of March.
Meanwhile, in the corporate arena, there were a few items worth mentioning. Specifically, shares of BlackBerry Limited (BBRY) jumped after the mobile device maker delivered better-than-expected results. Also, shares of FMC (FMC) moved sharply higher on some M&A news. Specifically, DuPont (DD – Free DuPont Stock Report) will sell FMC a portion of its crop protection business, while FMC will provide DuPont with its health and nutrition assets. These deals should help DuPont pass regulatory scrutiny, as it works to finalize its merger with competitor Dow Chemical (DOW).
Technically, stocks have hung in there over the past several sessions. However, it remains to be seen, if this resilience can continue into next week, and then through the first-quarter earnings season. – Adam Rosner
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
Mid-Day Update - 12:05 PM EDT
The major stock indexes are trading in uninspired fashion on this last day of the month, following a nice run for the quarter as a whole. Right around the noon hour on the East Coast, the Dow Jones Industrial Average is off 40 points; the NASDAQ is up four points; and the S&P 500 is largely unchanged. Market breadth is showing a firmer undertone, though, with advancing issues topping decliners on both the New York Stock Exchange and the NASDAQ.
This morning’s business news included a reading on February consumer spending from the Commerce Department. Personal consumption for the period rose less than expected, partly owing to lower fuel outlays as a result of mild winter weather. But personal income rose in line with expectations. Meantime, an inflation gauge closely watched by the Federal Reserve came in at 2.1% for the preceding 12 months. That is close to the Fed’s 2% inflation target, and suggests the central bank will stick to its plan to raise interest rates twice more in 2017.
Among the stock market’s various sectors, the defensive utilities and consumers staples groups are showing relative strength today.
Elsewhere, oil prices are slightly lower, but the benchmark domestic grade is holding above $50 a barrel. There is some thinking that refiners will soon accelerate purchases of crude oil, in anticipation of the upcoming driving season. There is also a possibility that OPEC will extend the production cuts initiated by the cartel late last year.
In corporate news, shares of chemicals manufacturer FMC Corp. (FMC) are surging on word that the company will be selling most of its health and nutrition unit to DuPont (DD - Free DuPont Stock Report). As part of the deal, FMC will be acquiring part of DuPont’s crop protection business. DuPont’s goal with the transactions is to satisfy the concerns of European Union regulators’ overseeing its planned merger with Dow Chemical (DOW).
Broadly, stocks have enjoyed a favorable trend since the start of the year, but now appear to be awaiting some confirmation of the optimism felt toward corporate earnings estimates, the economy, and the Trump Administration’s agenda. First-quarter earnings season will get going in earnest in a couple of weeks. - Robert Mitkowski
At the time of this writing, the author did not have positions in any of the companies mentioned.
Before the Bell
The stock market, which has seen up-and-down action recently, particularly over the past fortnight, got out of the gate in mixed fashion yesterday morning, despite the issuance of constructive economic data. On point, revised fourth-quarter gross domestic product growth showed that the nation's economy had expanded by a better-than-expected 2.1% in that period, up from the 1.9% gain tabulated in a prior release last month, and ahead of the 2.0% uptick forecast. Strength in consumer spending and additional inventory accumulation led to the improvement, which probably will be more or less matched during the now-ending quarter.
Also helping the market was a dip in weekly jobless claims and a further rise in crude oil prices. Mixed showings in Asia and Europe earlier in the day did little to influence trading, nor did the latest news out of a fractious Washington. So, stocks, after a brief selling flurry early on, started to tidy things up within a half hour or so of the open, and the market commenced a nice rally to end a mixed month. In all, as we neared the noon hour in New York, the Dow Jones Industrial Average had jumped to a gain of some 80 points. Similar percentage increases were tallied by the S&P 500, with the NASDAQ's rise a bit smaller.
Further breaking down the morning's activity, we see that the S&P Mid-Cap 400 and the small-cap Russell 2000 were marching in step with the Dow and the S&P 500 on a percentage basis. So it was a broad-based advance to that point, with seven of the top 10 sectors advancing in prices along with almost twice as many individual stocks as not. As to the economy, in addition to the better claims data, the solid revision in GDP, and a recent report showing rising home prices, there was a key issuance on Tuesday, which detailed a strong in consumer confidence. That report helped fuel Tuesday's big market gain.
Things then changed little after lunch, even though there were several brief profit-taking episodes. Overall, though, the Dow's gain stayed within 50 to 90 points, for the most part. The NASDAQ, meantime, after a slow start just about matched the Dow's increase, while the small-cap Russell 2000 raced out to a session-best percentage gain of almost three-quarters of a percent. The number of groups gaining in price, meantime, dipped somewhat late in the day, with a five-to-five split evolving as we moved into the final hour of the session. Also gaining stocks retained their lead on the NYSE, only a somewhat lesser one than in the morning.
The advance then held intact during the closing few minutes, with the selling that has often occurred lately not taking hold. Thus, as the closing bell sounded, the Dow remained ahead by 69 points; the S&P 500 Index was better by seven points, thereby remaining well up on its 50-day moving average; and the NASDAQ was in the plus column by 17 points. As before, the Russell 2000 was the big winner, with a gain of close to a full percentage point. Notwithstanding some headwinds last week, Wall Street likely will end the week and the opening quarter with a nice extension of last fall's post-election rally.
Now, the quarter concludes, and with the last look at the period on this final day of this three-month span, we look out to Asia and see that stocks were generally lower in overnight trading. In Europe, meanwhile, the key bourses are ending the quarter with some red ink, as well. Also of note, oil a winner in New York yesterday, is off this morning in early dealings; interest rates are higher; and the U.S. futures are showing some initial weakness. So, we could end a solid quarter on a softer note as we look out to the further unfolding of the early spring and to the pending start of first-quarter earnings season. – Harvey S. Katz
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
