After The Close
The stock market put in a mixed-to-weak performance today, as investors digested the latest batch of corporate profit reports. At the end of the session, the Dow Jones Industrial Average was down 135 points (after a sharper drop of more than 285 points earlier this morning). The S&P 500 Index closed off nominally, as well. However, the NASDAQ managed to advance 17 points. Market breadth showed some weakness to today’s session, as decliners outnumbered advancers by a narrow margin on the NYSE. Specifically, the industrials weighed on the market, while the utilities and healthcare names managed to make some progress.
In economic news, initial jobless claims moved up to 230,000 for the week of March 20th. This reading was a bit higher than had been expected, and also well above the prior week’s number. Elsewhere, durable goods orders increased 2.7% in the month of March, which was a solid improvement. (The core number, which excludes transportation, was up 0.4%, a more moderate gain). Tomorrow, we will get a look at the advance estimate for first-quarter GDP. This report will likely be of some importance for traders.
In the corporate arena, the first-quarter earnings season is now in full swing. Over the past 24 hours, many large companies weighed in with their numbers. Of note, 3M Company (MMM – Free 3M Stock Report) put out a disappointing report, sending that stock sharply lower and pressuring the Dow Jones Industrial Average. This was partially balanced by a solid showing from Microsoft (MSFT – Free Microsoft Stock Report).
Technically, the stock market continues to hold up well, and seems to be getting some support from the current earnings season, so far. However, many companies have yet to report.
- 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
As to influences, the major one again was earnings. For the most part, results have been favorable, with the majority of companies beating their targets for the latest period. The market also is benefiting from stability in Federal Reserve interest-rate policies. In the meantime, as we moved into the second hour of trading, the Dow and the NASDAQ joined the S&P 500 and the smaller indexes in the green. It would seem that additional records are on the way. With regard to earnings, Dow component Caterpillar (CAT – Free Caterpillar Stock Report) posted better-than-expected results yesterday morning, but the stock faltered in the early going.
In other news, Boeing (BA – Free Boeing Stock Report) has suspended its 2019 guidance and halted its buyback program. Still, the issue was ahead by more than 1% on the day during mid-morning,after having fallen notably following the tragic crash of its 737 MAX 8 airliner. The stock market then would go back and forth around the neutral line as the morning progressed. That in-and-out activity would then carry into the noon hour in New York, with the composites generally in the plus column, but dipping into the red at times as sentiment shifted. The market is overbought, but seemingly not ready to backtrack with any seriousness.
The first part of the afternoon then would bring modestly lower prices, with the Dow generally sustaining a deficit of between 25 points and 50 points. The other indexes held near breakeven. As we reached the final hour of trading, some buyers reappeared and eased the declines somewhat. Investors remained rather nervous ahead of a succession of earnings reports that were due out both after the stock market closed for the day and ahead of the opening this morning. In all, yesterday was the busiest day of the cycle for earnings reports.
The market then meandered about progressively lower prices as the session wound down to a close, with prices falling back some in the last half hour of trading. There seemed to be no news developments for the late selling, although as we did note, the market is somewhat overbought and ripe for some profit taking, and that seems to be what transpired as the final bell approached. In all the Dow would give back 59 points; the S&P 50o would end off six points; and the NASDAQ would shed 19 points. However, the smaller-cap composites would hang onto small increases.
Now, a new day commences, as looking across the world to Asia we see that stocks were mixed in the overnight hours, while in Europe, the early read is lower. Elsewhere, oil prices, off yesterday on our shores, are now gaining and Treasury note yields, which also backed off yesterday, are now flat. Finally, on another earnings-driven day, U.S. equity futures are now signaling a mixed start to the new session.
