Market Summary
from Briefing.comIndustry Watch
Strong: Telecom Services, Utilities
Weak: Energy, Health Care, Technology, Industrials
Market Moving Factors
- No progress between Greece and creditors: Reuters reports Eurozone officials have discussed a default scenario in a 'theoretical' way
- S&P 500 revisits 50-day moving average (2,103)
Stocks End Week on Cautious Note With Greece in Focus
[BRIEFING.COM] The stock market ended the week on a lower note with the Dow Jones Industrial Average pacing the Friday decline. The price-weighted index lost 0.8%, but added 0.3% for the week, while the S&P 500 settled lower by 0.7%, narrowing its weekly gain to a slim 0.1%.
The Friday session started amid selling pressure in Europe and the U.S. as it became clear that another week will go by without a deal between Greece and its creditors. The continued uncertainty had markets in France and Germany down more than 2.0% apiece, but a well-timed rumor helped the indices slash a percentage point off their losses just in time for the close. Specifically, an unnamed Greek government official was quoted as saying a new counter-proposal has been sent to the lenders and the two sides are "closer than ever" to an agreement.
Despite the rumors, safe-haven demand boosted Germany's 10-yr bund, dropping its yield six basis points to 0.83%. Conversely, selling in Greek and Spanish debt securities caused their yields to spike. Greece's 10-yr yield surged 51 basis points to 11.56% while Spain's 10-yr yield jumped 12 basis points to 2.27%.
In addition to helping European equities trim their losses, the news helped the S&P 500 rally six points off its low, but the index returned to its worst level of the day during the afternoon, ending well below its 50-day moving average (2,103), which was violated at the open.
It is worth pointing out that today's trading volume was well below average with just 645 million shares changing hands at the NYSE floor, suggesting a fair share of participants chose to forego today's session altogether.
All ten sectors registered losses with energy (-1.2%) and health care (-1.1%) spending the day behind the remaining eight groups. The energy sector retreated alongside crude oil, which fell 1.3% to $59.93/bbl. For its part, the sector lost 0.9% for the week, while only two other groups registered weekly losses with technology and utilities surrendering 0.7% and 0.5%, respectively.
The technology sector underperformed for the second day in a row amid broad weakness. Large cap names like Apple (AAPL 127.17, -1.42), IBM (IBM 166.99, -1.79), Microsoft (MSFT 45.97, -0.47), and Qualcomm (QCOM 67.02, -0.57) lost between 0.9% and 1.1% while the high-beta PHLX Semiconductor Index fell 0.9% to end the week lower by 1.7%.
Generally speaking, today's session was devoid of corporate news, but Twitter (TWTR 35.90, +0.06) made headlines after Chief Executive Officer Dick Costolo announced he will step down from his post on July 1 with co-founder and Chairman Jack Dorsey taking Mr. Costolo's place in the interim. Shares of TWTR opened higher, but a daylong retreat resulted in a flat close for the stock.
Elsewhere, the financial sector (-0.4%) ended ahead of most other groups, locking in a 1.0% gain for the week with investors angling to take advantage of rising rates.
Speaking of rates, the 10-yr note rallied at the start, but reversed after the Greece-related rumor crossed in the late morning. The benchmark note registered a four-tick loss with its yield inching up a basis point to 2.39%. For the week, the benchmark yield slipped two basis points after testing the 2.49% level on Wednesday.
Economic data included PPI and Michigan Sentiment:
The major averages began the trading week on a cautious note with the S&P 500 (-0.6%) settling beneath its 100-day moving average (2,085) for the first time since late March. The benchmark index retreated into the afternoon while the Nasdaq Composite (-0.9%) underperformed throughout the day. Broadly speaking, the Monday session was very quiet with no corporate news to account for the decline; however, the continued lack of progress between Greece and its creditors weighed on investor sentiment in Europe and the U.S.
The stock market ended the Tuesday session near its flat line with the S&P 500 registering a slight gain (+0.04%) while the Nasdaq Composite (-0.2%) settled in the red. Equity indices slumped at the start with investor sentiment pressured by the continued lack of progress between Greece and its creditors. The ongoing uncertainty weighed on European markets, but they were able to climb off their lows into the close. Meanwhile, U.S. stocks hit their lows not long before Europe closed for the day before returning to their flat lines. The ensuing rebound helped stocks turn positive during afternoon action, but the S&P 500 could not overtake its 100-day moving average (2,085), settling below that mark for the second consecutive day. Interestingly, this was the first time that the benchmark index registered back-to-back settlements below the 100-day average since late October.
After struggling with its 100-day moving average (2,086) on Tuesday, the S&P 500 wasted no time charging back above that mark on Wednesday. The benchmark index gained 1.2% while the Dow (+1.3%) and Nasdaq Composite (+1.3%) outperformed throughout the session. In addition to regaining its 100-day average, the S&P 500 climbed above the 50-day average (2,102) after Bloomberg reported Germany may be willing to offer a staggered deal to Greece. This deal would allow the disbursement of additional bailout funds in exchange for a Greek commitment to executing one of the reforms requested by the creditors. On a related note, the European Central Bank increased Greece's allowance to Emergency Liquidity Assistance funds by EUR2.30 billion to EUR83 billion. The news jolted global equities, helping Germany's DAX end the day higher by 2.5%. Furthermore, selling in Germany's 10-yr bund resulted in the first test of the 1.00% level since October. Germany's benchmark yield ended the day below its session high of 1.06%, at 0.98% (+3 bps).
The market ended Thursday on a modestly higher note with the S&P 500 (+0.2%) posting its third consecutive advance. Equity indices rallied out of the gate, hitting their highs during the opening hour of action; however, the market was knocked back into the middle of its range after it was reported that International Monetary Fund representatives left Brussels for Washington due to insufficient progress between Greece and the creditors. Furthermore, IMF spokesman Gerry Rice stressed the continued presence of major differences, saying, "We are well away from an agreement." Despite the continued macro uncertainty, seven of ten sectors registered gains while consumer staples (-0.1%) and energy (-0.4%) spent the day in the red. In addition, technology (-0.1%) turned negative during the afternoon.
[BRIEFING.COM] The stock market ended the week on a lower note with the Dow Jones Industrial Average pacing the Friday decline. The price-weighted index lost 0.8%, but added 0.3% for the week, while the S&P 500 settled lower by 0.7%, narrowing its weekly gain to a slim 0.1%.
The Friday session started amid selling pressure in Europe and the U.S. as it became clear that another week will go by without a deal between Greece and its creditors. The continued uncertainty had markets in France and Germany down more than 2.0% apiece, but a well-timed rumor helped the indices slash a percentage point off their losses just in time for the close. Specifically, an unnamed Greek government official was quoted as saying a new counter-proposal has been sent to the lenders and the two sides are "closer than ever" to an agreement.
Despite the rumors, safe-haven demand boosted Germany's 10-yr bund, dropping its yield six basis points to 0.83%. Conversely, selling in Greek and Spanish debt securities caused their yields to spike. Greece's 10-yr yield surged 51 basis points to 11.56% while Spain's 10-yr yield jumped 12 basis points to 2.27%.
In addition to helping European equities trim their losses, the news helped the S&P 500 rally six points off its low, but the index returned to its worst level of the day during the afternoon, ending well below its 50-day moving average (2,103), which was violated at the open.
It is worth pointing out that today's trading volume was well below average with just 645 million shares changing hands at the NYSE floor, suggesting a fair share of participants chose to forego today's session altogether.
All ten sectors registered losses with energy (-1.2%) and health care (-1.1%) spending the day behind the remaining eight groups. The energy sector retreated alongside crude oil, which fell 1.3% to $59.93/bbl. For its part, the sector lost 0.9% for the week, while only two other groups registered weekly losses with technology and utilities surrendering 0.7% and 0.5%, respectively.
The technology sector underperformed for the second day in a row amid broad weakness. Large cap names like Apple (AAPL 127.17, -1.42), IBM (IBM 166.99, -1.79), Microsoft (MSFT 45.97, -0.47), and Qualcomm (QCOM 67.02, -0.57) lost between 0.9% and 1.1% while the high-beta PHLX Semiconductor Index fell 0.9% to end the week lower by 1.7%.
Generally speaking, today's session was devoid of corporate news, but Twitter (TWTR 35.90, +0.06) made headlines after Chief Executive Officer Dick Costolo announced he will step down from his post on July 1 with co-founder and Chairman Jack Dorsey taking Mr. Costolo's place in the interim. Shares of TWTR opened higher, but a daylong retreat resulted in a flat close for the stock.
Elsewhere, the financial sector (-0.4%) ended ahead of most other groups, locking in a 1.0% gain for the week with investors angling to take advantage of rising rates.
Speaking of rates, the 10-yr note rallied at the start, but reversed after the Greece-related rumor crossed in the late morning. The benchmark note registered a four-tick loss with its yield inching up a basis point to 2.39%. For the week, the benchmark yield slipped two basis points after testing the 2.49% level on Wednesday.
Economic data included PPI and Michigan Sentiment:
- Producer prices saw their largest one-month increase since April 2011, rising 0.5% in May after declining 0.4% in April while the Briefing.com consensus expected an increase of 0.4%
- Almost the entire increase in the PPI can be attributed to higher energy costs, and namely higher gasoline prices as total energy costs increased 5.9% in May after declining 2.9% in April
- Gasoline prices jumped 17.0% in May following a 4.7% decline in April
- Food prices increased 0.8% in May after declining 0.9% in April
- Excluding food and energy, core PPI increased 0.1% in May after decreasing 0.2% in April, which is what the consensus expected
- Almost the entire increase in the PPI can be attributed to higher energy costs, and namely higher gasoline prices as total energy costs increased 5.9% in May after declining 2.9% in April
- The University of Michigan Consumer Sentiment Index increased to 94.6 in the preliminary June reading from 90.7 in May while the Briefing.com consensus expected an increase to 91.5
- Nasdaq Composite +6.7% YTD
- Russell 2000 +5.0% YTD
- S&P 500 +1.8% YTD
- Dow Jones Industrial Average +0.5% YTD
The major averages began the trading week on a cautious note with the S&P 500 (-0.6%) settling beneath its 100-day moving average (2,085) for the first time since late March. The benchmark index retreated into the afternoon while the Nasdaq Composite (-0.9%) underperformed throughout the day. Broadly speaking, the Monday session was very quiet with no corporate news to account for the decline; however, the continued lack of progress between Greece and its creditors weighed on investor sentiment in Europe and the U.S.
The stock market ended the Tuesday session near its flat line with the S&P 500 registering a slight gain (+0.04%) while the Nasdaq Composite (-0.2%) settled in the red. Equity indices slumped at the start with investor sentiment pressured by the continued lack of progress between Greece and its creditors. The ongoing uncertainty weighed on European markets, but they were able to climb off their lows into the close. Meanwhile, U.S. stocks hit their lows not long before Europe closed for the day before returning to their flat lines. The ensuing rebound helped stocks turn positive during afternoon action, but the S&P 500 could not overtake its 100-day moving average (2,085), settling below that mark for the second consecutive day. Interestingly, this was the first time that the benchmark index registered back-to-back settlements below the 100-day average since late October.
After struggling with its 100-day moving average (2,086) on Tuesday, the S&P 500 wasted no time charging back above that mark on Wednesday. The benchmark index gained 1.2% while the Dow (+1.3%) and Nasdaq Composite (+1.3%) outperformed throughout the session. In addition to regaining its 100-day average, the S&P 500 climbed above the 50-day average (2,102) after Bloomberg reported Germany may be willing to offer a staggered deal to Greece. This deal would allow the disbursement of additional bailout funds in exchange for a Greek commitment to executing one of the reforms requested by the creditors. On a related note, the European Central Bank increased Greece's allowance to Emergency Liquidity Assistance funds by EUR2.30 billion to EUR83 billion. The news jolted global equities, helping Germany's DAX end the day higher by 2.5%. Furthermore, selling in Germany's 10-yr bund resulted in the first test of the 1.00% level since October. Germany's benchmark yield ended the day below its session high of 1.06%, at 0.98% (+3 bps).
The market ended Thursday on a modestly higher note with the S&P 500 (+0.2%) posting its third consecutive advance. Equity indices rallied out of the gate, hitting their highs during the opening hour of action; however, the market was knocked back into the middle of its range after it was reported that International Monetary Fund representatives left Brussels for Washington due to insufficient progress between Greece and the creditors. Furthermore, IMF spokesman Gerry Rice stressed the continued presence of major differences, saying, "We are well away from an agreement." Despite the continued macro uncertainty, seven of ten sectors registered gains while consumer staples (-0.1%) and energy (-0.4%) spent the day in the red. In addition, technology (-0.1%) turned negative during the afternoon.
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Economic Data
from Briefing.com| Date | ET | Release | For | Actual | Briefing.com Forecast | Briefing.com Consensus | Prior | Revised From |
|---|---|---|---|---|---|---|---|---|
| Jun 12 | 08:30 | PPI | May | 0.5% | 0.5% | 0.4% | -0.4% | |
| Jun 12 | 08:30 | Core PPI | May | 0.1% | 0.2% | 0.1% | -0.2% | |
| Jun 12 | 10:00 | Mich Sentiment | Jun | 94.6 | 92.5 | 91.5 | 90.7 |
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Technical Update
DOW JONES INDUSTRIAL AVERAGE
17898.84 -140.53 (-0.78%)
Volume: 83.76 Mil below average of 95.79 Mil
Range: 17857.07 - 18035.83
NASDAQ COMPOSITE
5051.100098 -31.41 (-0.62%)
Volume: 1428.90 Mil below average of 1745.55 Mil
Range: 5043.240234 - 5067.959961
S&P500 INDEX
2094.11 -14.75 (-0.70%)
Volume: 449.50 Mil below average of 516.73 Mil
Range: 2091.33 - 2107.43
17898.84 -140.53 (-0.78%)
Volume: 83.76 Mil below average of 95.79 Mil
Range: 17857.07 - 18035.83
NASDAQ COMPOSITE
5051.100098 -31.41 (-0.62%)
Volume: 1428.90 Mil below average of 1745.55 Mil
Range: 5043.240234 - 5067.959961
S&P500 INDEX
2094.11 -14.75 (-0.70%)
Volume: 449.50 Mil below average of 516.73 Mil
Range: 2091.33 - 2107.43
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Market Internal
NYSE :Lower than average volume @ 648.6M vs 733.852M
Decliners outpaced Advancers(adv/dec): 1077M/1963M
New lows outpaced highs(high/low): 46/101
NASDAQ :
Lower than average volume @ 1415.1M vs 1754.92M
Decliners outpaced Advancers(adv/dec): 1160M/1603M
New highs outpaced low(high/low): 78/31
Decliners outpaced Advancers by 1.59 to 1 on lower volumes 2063.7 ( -17.08%) than avg 2489 (+0.02%)
VOLATILITY S&P500 (VIX) :
13.78 0.93(7.24%)
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Bonds, Currencies & Commodities
from Briefing.comBonds
Governments Oscillate Between Gains and Losses
- Treasuries sold off this morning after the May PPI was released, then recovered to solid gains on safe-haven demand during the equity sell-off, and then gave back the gains to end unchanged
- Yield Check:
- 2-yr: unch at 0.72%
- 5-yr: unch at 1.73%
- 10-yr: unch at 2.38%
- 30-yr: unch at 3.09%
- 10-year Spanish Bono/German Bund: +18 bps to 144 bps
- News:
- The Producer Price Index rose 0.5% in May after declining 0.4% in April. The Briefing.com consensus expected the PPI to increase 0.4%
- Almost the entire increase in the headline PPI can be attributed to higher energy costs, specifically higher gasoline prices
- It was the largest 1-month increase since a similar gain was recorded in April 2011. Despite the large gain, producer prices are still down 1.1% from a year ago
- Core PPI, which excludes volatile food and energy prices, increased 0.1% in May after decreasing 0.2% in April. The consensus was looking for an increase of 0.1%
- The University of Michigan Consumer Sentiment Index rose to 94.6 in June from 90.7 in May. The Briefing.com consensus called for 91.5
- The labor market has been very strong lately and this likely drove the upside surprise
- The Expectations Index increased to 86.8 in June from 84.2 in May. The Current Conditions Index rose to 106.8 in June from 100.8 in May
- S&P downgraded 4 Greek banks to CCC with a negative outlook. Its opinion is that those banks will default within a year without another agreement between Greece and its creditors
- Greece will submit counter-proposals to its creditors in Brussels on Saturday
- The Producer Price Index rose 0.5% in May after declining 0.4% in April. The Briefing.com consensus expected the PPI to increase 0.4%
- Commodities:
- WTI crude: -1.35% to $59.97/bbl.
- Gold: -0.70% to $1,197.70/troy oz.
- Copper: +0.39% to $2.6795/lb.
- Currencies:
- EUR/USD: +0.03% to $1.1249
- USD/JPY: -0.09% to 123.44
- Week Ahead:
- Monday: June Empire Manufacturing (08:30 ET); May Industrial Production and Capacity Utilization (09:15 ET); June NAHB Housing Market Index (10:00 ET); April Net Long-Term TIC Flows (16:00 ET)
- Tuesday: May Housing Starts (08:30 ET); May Building Permits (08:30 ET)
- Wednesday: MBA Mortgage Index for the week ending 6/13 (07:00 ET); Crude Inventories for the week ending 6/13 (10:30 ET); FOMC Rate Decision (14:00 ET)
- Thursday: Initial Jobless Claims for the week ending 6/13 and Continuing Jobless Claims for the week ending 6/6 (08:30 ET); May CPI and Core CPI (08:30 ET); Q1 Current Account Balance (08:30 ET); June Philadelphia Fed (10:00 ET); May Leading Indicators (10:00 ET); Natural Gas Inventories for the week ending 6/13 (10:30 ET); $7 billion 30-Year TIPS (reopening) (results at 13:00 ET)
- Friday: San Francisco Fed President Williams (FOMC voter) gives policy speech (11:40 ET); Cleveland Fed President Mester (non-FOMC voter) speaks on “Community Development and the Federal Reserve” (12:45 ET)
Currencies
Mixed Day for FX- Despite the heightened fear in global equity markets, only the Swissy moved more than a third of a percent against the U.S. dollar
- U.S. Dollar Index: -0.05% to 94.93
- USD/CHF fell -0.71% to 0.9272 as the Swiss franc benefited from safe-haven buying
- EUR/USD gained 0.31% to $1.1280, a very impressive performance considering that the Greek 10-year yield spiked 50 basis points and peripheral European debt was showing renewed signs of stress, losing ground against sovereigns of the European core
- Eurozone Industrial Production grew a less-than-expected 0.1% in April after a decline of 0.4% in March. The market was looking for +0.3%
- GBP/USD: +0.31% to $1.5563
- S&P revised the U.K.'s credit outlook to negative from stable. The country's rating was maintained at AAA. The change was a result of the outright victory by the Conservatives in May's general election. David Cameron promised a referendum on EU membership for the United Kingdom during the election, and S&P is worried about the status of Scotland in the event of Britons voting to leave
- S&P also voiced concern with the high current account and budget deficits
- USD/JPY: -0.02% to 123.52
- USD/CAD: +0.24% to 1.23235
- AUD/USD: -0.23% to $0.7753
- NZD/USD: -0.39% to 0.6991
Commodities
- The dollar index saw its early morning strength fade as the session carried on, falling steadily after the release of US econ and consumer sentiment data.
- After its mid-morning sell-off, movements in the dollar were tame, as the index held steady and finished flat at 94.97
- Crude traded in the red all session, as a noticeable lack in trend was driven by over-supply sentiment continued from earlier this week and an unsteady dollar
- The Baker Hughes rig count released mid-session, showed a 7 oil rig drop from last week which kept sentiment from turning positive on the day.
- The July contract ended down 1.3% to $59.93/barrel
- Copper bounced from the flatline in its most recent trade, helping the commodity to close modestly higher as the market continued to weigh potential outcomes associated with this week's weak Chinese econ data. Copper closed +0.4% to $2.68/lb
- Natural gas sold-off heavily into the close, despite a lack of clear catalysts for the price move. July nat gas closed -2.8% to $2.75/MMBtu
- August gold ended -0.1% to $1179.30/oz and July silver finished -0.7% to $15.84/oz
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Preview: Monday, 15 Jun 2015
Economic Data
| Date | ET | Release | For | Actual | Briefing.com Forecast | Briefing.com Consensus | Prior | Revised From |
|---|---|---|---|---|---|---|---|---|
| Jun 15 | 08:30 | Empire Manufacturing | Jun | 5.0 | 6.0 | 3.1 | ||
| Jun 15 | 09:15 | Industrial Production | May | 0.0% | 0.3% | -0.3% | ||
| Jun 15 | 09:15 | Capacity Utilization | May | 78.2% | 78.3% | 78.2% | ||
| Jun 15 | 10:00 | NAHB Housing Market Index | Jun | 55 | 56 | 54 | ||
| Jun 15 | 16:00 | Net Long-Term TIC Flows | Apr | NA | NA | $17.6B | ||
| Jun 16 | 08:30 | Housing Starts | May | 1065K | 1100K | 1135K | ||
| Jun 16 | 08:30 | Building Permits | May | 1100K | 1100K | 1143K | ||
| Jun 17 | 07:00 | MBA Mortgage Index | 06/13 | NA | NA | NA | ||
| Jun 17 | 10:30 | Crude Inventories | 06/13 | NA | NA | -6.812M | ||
| Jun 17 | 14:00 | FOMC Rate Decision | Jun | 0.25% | 0.25% | 0.25% | ||
| Jun 18 | 08:30 | Initial Claims | 06/13 | 278K | 276K | 279K | ||
| Jun 18 | 08:30 | Continuing Claims | 06/06 | 2267K | 2270K | 2265K | ||
| Jun 18 | 08:30 | CPI | May | 0.5% | 0.5% | 0.1% | ||
| Jun 18 | 08:30 | Core CPI | May | 0.1% | 0.2% | 0.3% | ||
| Jun 18 | 08:30 | Current Account Balance | Q1 | -$116.0B | -$116.4B | -$113.5B | ||
| Jun 18 | 10:00 | Philadelphia Fed | Jun | 9.0 | 8.0 | 6.7 | ||
| Jun 18 | 10:00 | Leading Indicators | May | 0.3% | 0.4% | 0.7% | ||
| Jun 18 | 10:30 | Natural Gas Inventories | 06/13 | NA | NA | 111 bcf |
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