After the Close
The stock market put in a subdued performance today, as traders returned from a three-day holiday weekend. At the close of the session, the Dow Jones Industrial Average was down about 51 points; the S&P 500 Index was off three points; and the NASDAQ was lower by seven points. Market breadth showed a negative bias to today’s session, with decliners modestly ahead of advancers on the NYSE. The major market sectors were mixed, as gains in the telecom and technology issues were offset by losses in the financial and energy names.
Meanwhile, traders received a couple of economic news items this morning. Specifically, personal income increased 0.4% in April, with a similar rise in personal spending. These figures more or less matched analyst expectations. Further, the Conference Board’s Consumer Confidence Index settled at 117.9 for the month of May, falling just short of the consensus forecast. Tomorrow, a few more economic reports are due out. Specifically, we will get a look at pending homes sales for the month of April, a report on business conditions in the greater Chicago region, and in the early afternoon, the Federal Reserve will release its Beige Book summation for the month of May.
Meanwhile, few widely followed corporations delivered their financial results this morning. However, there was some M&A activity to report. Here, shares of Atwood Oceanics (ATW) soared on reports that the energy company will be bought by Ensco PLC (ESV) in an all-stock transaction.
Technically, the stock market took a bit of a pause today, as traders returned to Wall Street. The S&P 500 Index still sits above the 2,400 mark, which is likely a key area to watch. It remains to be seen how stocks will fare in the weeks ahead. Clearly, traders will be watching for corporate and political developments, while also keeping an eye on the Fed. – 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 - 12:10 PM EDT
Following the long Memorial Day weekend, in which Americans paused to reflect on the heroic sacrifice of hundreds of thousands of brave soldiers who died in defense of our country and democratic way of life over the past two-and-half centuries, the stock market opened the new week somewhat lower. To be sure, the leading large-cap composites, notably the Dow Jones Industrial Average, the Standard and Poor's 500 Index, and the NASDAQ are all at or very near record highs, so a certain degree of profit taking is in order. Indeed, the initial pullback was orderly, constructive, and relatively shallow.
As to the stock market, the focus was on the economy, with data out very early this morning affirming that personal income rose by 0.4% in April, which was in line with expectations, while consumer spending gained 0.4%, as well. Following this release and 30 minutes after the market's opening, the Conference Board reported that its Consumer Confidence Index had fallen back somewhat in May, coming in with a score of 117.9. Also on the economic docket today is a home price indicator and a manufacturing survey in the greater Dallas area.
The headline economic issuance this morning, meantime, was the consumer confidence survey. As noted, that index fell to 117.9 for this now-concluding month. That was below expectations of 119.8. It also was a little lower than the 120.3 score registered for April and the 125.6 tally booked in March, which had been the highest level since December of 2000. Still, this latest data showed further resilience in this category and, in that respect, was relatively consistent with the solid Consumer Sentiment reading issued by the University of Michigan.
However, the market did soften for a time after this Conference Board release, and within minutes of that survey coming out, the Dow was off by more than 50 points, then falling to a morning-worst 70 points. The S&P 500 Index, too, was somewhat weaker, as were the NASDAQ, the small-cap Russell 2000 and the S&P Mid-Cap 400. As has been the case often, however, the equity market managed to bounce off these lows, and by late in the morning, the losses were about halved. Helping the market was a housing price index showing a solid gain and lower interest rates, with the yield on the 10-year Treasury note down at 2.23%.
Breaking the morning's action down, we see that six of the 10 leading equity groups are lower, with oil down the most on weaker crude prices. All told, a barrel of crude is down more than a percentage point in New York. Meanwhile, losing stocks hold more than a three-to-two lead on gaining stocks on the NYSE. As for the indexes, as we reach the noon hour in New York, the Dow is now off 43 points; the S&P 500 is down three points; and the NASDAQ is lower by five points, notwithstanding the fact that Amazon (AMZN) has broken the $1,000 mark for the first time ever. – Harvey S. Katz
At the time of this article's writing, the author did not have positions in any of the companies mentioned.
Before the Bell
The holiday-shortened trading week will soon kick off with the U.S. equity futures pointing to a modestly lower opening. More specifically, the Dow futures currently presage an approximate 30 point drop (0.15%), while the S&P 500 Index is expected to open about 10 points lower (0.20%). This follows a solid showing from the major indexes last week, in which they advanced about 1%, overall.
Overnight, the Asian markets traded mostly flat. A lack of market-moving news can be blamed for the largely directionless session. On our shores, this morning, we will receive a fair amount of economic news that may well influence trading today. For starters, April’s data for personal income, consumer spending, and core inflation are soon to be released. Later this morning, Case-Shiller’s March report on home prices and May’s figures for the consumer confidence index are on tap. We will provide that information, as well as our thoughts on the data, during our midday update. Stay tuned. – Ian Gendler
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
