Market Summary
from Briefing.comIndustry Watch
Strong: Consumer Discretionary, Energy, Financials, Materials, Industrials, Telecom Services
Weak: Consumer Staples, Health Care, Utilities
Market Moving Factors
- European markets rally after Financial Times suggests Greece has softened its stance; however, Greek FM Varoufakis says there has been 'no U-turn'
- Nasdaq Composite and health care sector pressured by biotechnology
Dow +196.09
at 17361.04,
Nasdaq +41.45
at 4676.69,
S&P +25.86
at 2020.85
[BRIEFING.COM] The stock market began the new trading week on a higher note. The S&P 500 spiked 1.3% while the Nasdaq (+0.9%) and Russell 2000 (+0.9%) underperformed.
Overall, the Monday session was fairly quiet with the market spending some time on each side of its unchanged level. The S&P 500 began with a slim gain, but relative weakness among high-beta biotechnology and chipmaker names kept heavily-weighted health care (+0.6%) and technology (+1.0%) sectors on the defensive. The S&P 500 tried to overcome that weakness, but was rebuffed by its 100-day moving average in the 2,010 area. However, a second effort in the late afternoon sent the S&P 500 well above the 100-day average to end the day.
All ten sectors finished in the green with energy (+3.0%) spending the entire session in the lead. The sector benefitted from a 2.8% advance in crude oil ($49.59/bbl) while also drawing strength from ExxonMobil (XOM 89.58, +2.16). Shares of XOM jumped 2.5% in reaction to better than expected earnings thanks to a $1 billion non-cash windfall resulting from deferred tax items and a favorable ruling for expropriated Venezuela assets.
Elsewhere among cyclical sectors, financials (+1.6%) and industrials (+1.5%) displayed relative strength throughout the day after posting respective losses of 7.0% and 3.7% in January. Meanwhile, the top-weighted technology sector (+1.0%) spent the day behind the broader market, but narrowed the gap during afternoon action.
For the most part, large cap tech names fared well, but Google (GOOGL 532.20, -5.35) and Facebook (FB 74.99, -0.92) lost 1.0% and 1.2%, respectively. Similarly, chipmakers struggled as a group, which limited the PHLX Semiconductor Index to an uptick of 0.3%.
The underperformance of semiconductor names kept the Nasdaq behind the broader market, but so did biotechnology. The iShares Nasdaq Biotechnology ETF (IBB 319.58, -2.07) lost 0.6% while the health care sector advanced 0.6%.
Similar to health care, the utilities sector (+0.4%) underperformed while consumer staples (+1.3%) and telecom services (+2.5%) fared well.
Treasuries registered modest losses with the 10-yr yield climbing three basis points to 1.68%.
Economic data included Personal Income/Spending data, ISM Index, and Construction Spending:
Overall, the Monday session was fairly quiet with the market spending some time on each side of its unchanged level. The S&P 500 began with a slim gain, but relative weakness among high-beta biotechnology and chipmaker names kept heavily-weighted health care (+0.6%) and technology (+1.0%) sectors on the defensive. The S&P 500 tried to overcome that weakness, but was rebuffed by its 100-day moving average in the 2,010 area. However, a second effort in the late afternoon sent the S&P 500 well above the 100-day average to end the day.
All ten sectors finished in the green with energy (+3.0%) spending the entire session in the lead. The sector benefitted from a 2.8% advance in crude oil ($49.59/bbl) while also drawing strength from ExxonMobil (XOM 89.58, +2.16). Shares of XOM jumped 2.5% in reaction to better than expected earnings thanks to a $1 billion non-cash windfall resulting from deferred tax items and a favorable ruling for expropriated Venezuela assets.
Elsewhere among cyclical sectors, financials (+1.6%) and industrials (+1.5%) displayed relative strength throughout the day after posting respective losses of 7.0% and 3.7% in January. Meanwhile, the top-weighted technology sector (+1.0%) spent the day behind the broader market, but narrowed the gap during afternoon action.
For the most part, large cap tech names fared well, but Google (GOOGL 532.20, -5.35) and Facebook (FB 74.99, -0.92) lost 1.0% and 1.2%, respectively. Similarly, chipmakers struggled as a group, which limited the PHLX Semiconductor Index to an uptick of 0.3%.
The underperformance of semiconductor names kept the Nasdaq behind the broader market, but so did biotechnology. The iShares Nasdaq Biotechnology ETF (IBB 319.58, -2.07) lost 0.6% while the health care sector advanced 0.6%.
Similar to health care, the utilities sector (+0.4%) underperformed while consumer staples (+1.3%) and telecom services (+2.5%) fared well.
Treasuries registered modest losses with the 10-yr yield climbing three basis points to 1.68%.
Economic data included Personal Income/Spending data, ISM Index, and Construction Spending:
- Personal income increased 0.3% for a second consecutive month in December following a negative revision (from 0.4%) in November while the Briefing.com consensus expected personal income an increase of 0.3%
- Personal spending declined 0.3% after increasing a downwardly revised 0.5% (from 0.6%) in November while the consensus expected a decrease of 0.3%
- The ISM Manufacturing Index dropped to 53.5 in January from 55.1 in December while the Briefing.com consensus expected a decline to 54.7
- Production growth decelerated as the related index fell to 56.5 in January from 57.7 in December. The drop coincided with a decline in new orders (52.9 from 57.8) and a large contraction (46.0 from 52.5) in unfilled orders
- Construction spending increased 0.4% in December after declining an upwardly revised 0.2% (from -0.3%) in November while the Briefing.com consensus expected an increase of 0.8%
- Nasdaq Composite -1.3% YTD
- S&P 500 -1.9% YTD
- Russell 2000 -2.4% YTD
- Dow Jones Industrial Average -2.6% YTD
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Economic Data
from Briefing.com
| Date | ET | Release | For | Actual | Briefing.com Forecast | Briefing.com Consensus | Prior | Revised From |
|---|---|---|---|---|---|---|---|---|
| Feb 02 | 08:30 | Personal Income | Dec | 0.3% | 0.3% | 0.3% | 0.3% | 0.4% |
| Feb 02 | 08:30 | Personal Spending | Dec | -0.3% | -0.2% | -0.2% | 0.5% | 0.6% |
| Feb 02 | 08:30 | PCE Prices - Core | Dec | 0.0% | 0.0% | 0.0% | 0.0% | |
| Feb 02 | 10:00 | ISM Index | Jan | 53.5 | 55.0 | 54.7 | 55.1 | 55.5 |
| Feb 02 | 10:00 | Construction Spending | Dec | 0.4% | 0.9% | 0.8% | -0.2% | -0.3% |
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Technical Update
DOW
NASDAQ
S&P500
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Market Internal
NYSE :Higher than average volume @ 910.9M vs 834.782M
Advancers outpaced Decliners(adv/dec): 2283M/826M
New highs outpaced low(high/low): 169/62
NASDAQ :
Higher than average volume @ 1984.8M vs 1778.078M
Advancers outpaced Decliners(adv/dec): 1762M/1000M
New lows outpaced highs(high/low): 28/86
Advancers outpaced Decliners by 2.22 to 1 on higher volumes 2895.7 (+10.82%) than avg 2613 (+0.82%)
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Bonds, Currencies & Commodities
from Briefing.comBonds
Down, but Far From Out:- With the exception of the 2-yr note, Treasury securities spent the entirety of Monday's session in negative territory with just modest losses
- 2-yr yield +2 bps at 0.48%
- 5-yr yield +3 bps at 1.19%
- 10-yr yield +2 bps at 1.67%
- 30-yr bond +2 bps at 2.25%
- There were some supportive influences for continued buying interest, yet the lack of strong response to those influences suggested there was a bid to take some profits on the other side of Friday's hard-charging rally into the weekend
- The January ISM Index at 53.5 was weaker than expected (Briefing.com consensus 54.7)
- The PCE Price Index for December was up just 0.7% year-over-year while core PCE was up just 1.3%, both moving away from the Fed's inflation objective of 2.0%
- Construction Spending for December was up 0.4%, which was weaker than expected (Briefing.com consensus +0.8%)
- The U.S. stock market continued to have difficulty sustaining buying interest
- The January manufacturing PMI report for China, at 49.8, marked the first contraction reading in 2 1/2 years
- President Obama's FY16 budget proposed a higher capital gains tax and a tax on foreign profits
- The 2-yr note most notably ebbed and flowed with stocks and the data
- Intraday yield range was 0.43% to 0.49%
- Settled +2 bps at 0.48%
- 2-10-yr spread held steady at 119 basis points
- Oil prices continued to rebound, briefly moving above $50.00/bbl before being met with resistance
- WTI settled up $1.33, or 2.8%, at $49.57
- The move in oil was helped along by some weakening of the dollar, which slipped against both the yen and the euro
- USD/JPY -0.1% at 117.30
- EUR/USD +0.6% at 1.1348
- U.S Dollar Index -0.4% at 94.44
- Tuesday Data: December Factory Orders report (10:00 ET); January Auto and Truck sales
- Fed speak: St. Louis Fed President Bullard (non-FOMC voter) at 09:50 ET on U.S. and International Economies and Monetary Policy; Minneapolis Fed President Kocherlakota (non-FOMC voter) at 12:45 ET on Goal-Based Monetary Policy report
Currencies
Manufacturing Misses Expectations, Focus Turns to Week End Jobs Data: The Dollar Index has rolled over from overnight highs. The DXY has been running into resistance just under the 95 level the past few sessions. But it does continue to hold this 94.40 area. There are a few items at play. Perhaps the one having the biggest impact is some of the recent U.S. economic data which has been showing signs of the global slow down having an impact. That has led to a pause in the dollar rally at this 95 area. This morning the markets saw weaker than expected Personal Spending, Construction Spend and ISM Manufacturing numbers. Macro focus will start to turn toward the jobs data expected at the back end of the week.
- The euro has moved back into the middle of the 1.13 range as it sees some short covering. Aiding the move higher was also the Manufacturing PMI data which was slightly better than expected as a whole. The focus for the euro area remains on Greece with officials from both sides throwing out headline commentary. This is likely to continue throughout February. February 28 remains a key date for the two sides as that marks the end of the country's involvement in the current Troika bailout.
- The pound is seeing a 60 pip move off the 1.50 level. Sterling was able to hold the key level once again in overnight trade. The U.K. Manufacturing PMI came in better than expected and has provided a bid to cable.
- The yen was able to hold 118 and is pushing to session highs as markets see some early risk off trade. The yen will continue to trade against macro back drops as the Bank of Japan is not expected to make any changes to its current monetary policy or asset purchase programs in the immediate future.
Commodities
Oil Extends Gains:- WTI crude oil extended Friday's rally and is now up $5 or 11.1% in the last two trading sessions, getting a boost from Friday's rig count cut, but partially offset from some refinery employees being on strike in the U.S.
- Natural gas was in the red today and finished the session $0.01 lower at $2.68/MMBtu
- Precious metals were largely flat today, with Feb gold falling $1.50 to $1277.40/oz and Mar silver gaining $0.04 to $17.25/oz
- Mar copper ended unchanged at $2.49/lb
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Preview: Tuesday, 3 Feb 2015
Economic Data
| Date | ET | Release | For | Actual | Briefing.com Forecast | Briefing.com Consensus | Prior | Revised From |
|---|---|---|---|---|---|---|---|---|
| Feb 03 | 10:00 | Factory Orders | Dec | -2.4% | -2.0% | -0.7% | ||
| Feb 03 | 14:00 | Auto Sales | Jan | NA | NA | 5.9M | ||
| Feb 03 | 14:00 | Truck Sales | Jan | NA | NA | 7.9M |
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