Market Summary
from Briefing.comIndustry Watch
Strong: Consumer Discretionary, Financials, Technology, Real Estate
Weak: Energy, Materials, Health Care
- U.S. Bond market closed for Veterans Day
- Post-presidential election assessment continues
- U.S. earnings reporting season rolls on
- Heavily-weighted health care pulls back
- Fed Vice Chair Fischer: the case for removing policy accommodations is quite strong; fiscal policy would ease the Fed's task going forward
[BRIEFING.COM] The stock market ended the Thursday affair on a mixed note as investors continued adjusting their positions in preparation for a Donald Trump presidency. The Dow Jones Industrial Average (+1.2%) notched a new all-time high while the S&P 500 (+0.2%) and the Nasdaq Composite (-0.8%) finished behind the price-weighted average.
Equity indices jumped out of the gate, looking to build on yesterday's strong performances. The major averages staged an impressive reversal on Wednesday, shrugging off unexpected results from the 2016 election cycle while assessing what a Trump administration may mean for capital markets. The benchmark index notched a high in the opening hour of today's session while the Dow Jones Industrial Average set a new all-time high in early afternoon action.
The major indices saw some intraday divergence as investors responded to expectations for reduced regulations, lower personal and corporate taxes, and fiscal stimulus through large infrastructure projects. The combination had heavily-weighted financials (+3.7%), industrials (+2.1%), and health care (+1.2%) at the top of the leaderboard.
The three sectors gained at the expense of the technology space (-1.6%). On that note, Alphabet (GOOG 762.56, -22.75) and Apple (AAPL 107.76, -3.12) fell roughly 2.9% apiece. The tech space underperformed as some participants shifted their exposure to areas that are expected to benefit from large public works projects.
The benchmark index finished the day modestly higher as six sectors logged gains. On the flipside, defensively-oriented consumer staples (-2.8%), utilities (-2.5%), and telecom services (-2.3%) rounded out the board.
The financial sector (+3.7%) displayed relative strength as banking names paced the advance amid growing hopes for reduced regulations. Another day of steepening in the yield curve also contributed to the sector's strength. The Wall Street Journal reported this afternoon that the Trump administration may consider scrapping portions of the Dodd-Frank Act. Dow components JPMorgan Chase (JPM 76.65, +3.40, +4.6%) and Goldman Sachs (GS 200.87, +8.24, +4.3%) finished at the top of the price-weighted average.
In the industrial sector (+2.1%), aerospace and defense names outperformed as United Technologies (UTX 108.41, +3.60) gained 3.4%. Meanwhile, the Dow Jones Transportation Average finished higher by 1.9% amid strength in rail names. Union Pacific (UNP 97.49, +3.54) rallied 3.8% amid rising commodity prices and expectations for large-scale infrastructure projects.
Biotechnology names outperformed in the health care space (+1.2%), evidenced by the 1.7% gain in the iShares Nasdaq Biotechnology ETF (IBB 289.78, +4.79). The group saw continued buying interest, shrugging off recent concerns regarding potential drug pricing measures. On a related note, Dow component Pfizer (PFE 33.49, +1.37) gained 4.3%.
The Treasury complex finished on a mostly lower note with the long-end of the curve underperforming. The yield on the 2-yr note finished higher by one basis point (0.91%) while the yield on the benchmark 10-yr note rose eight basis points to 2.14%.
Today's trading volume was above the average of 914 million as more than 1.4 billion shares changed hands at the NYSE floor.
Today's economic data included weekly initial claims and the Treasury Budget for October:
Equity indices jumped out of the gate, looking to build on yesterday's strong performances. The major averages staged an impressive reversal on Wednesday, shrugging off unexpected results from the 2016 election cycle while assessing what a Trump administration may mean for capital markets. The benchmark index notched a high in the opening hour of today's session while the Dow Jones Industrial Average set a new all-time high in early afternoon action.
The major indices saw some intraday divergence as investors responded to expectations for reduced regulations, lower personal and corporate taxes, and fiscal stimulus through large infrastructure projects. The combination had heavily-weighted financials (+3.7%), industrials (+2.1%), and health care (+1.2%) at the top of the leaderboard.
The three sectors gained at the expense of the technology space (-1.6%). On that note, Alphabet (GOOG 762.56, -22.75) and Apple (AAPL 107.76, -3.12) fell roughly 2.9% apiece. The tech space underperformed as some participants shifted their exposure to areas that are expected to benefit from large public works projects.
The benchmark index finished the day modestly higher as six sectors logged gains. On the flipside, defensively-oriented consumer staples (-2.8%), utilities (-2.5%), and telecom services (-2.3%) rounded out the board.
The financial sector (+3.7%) displayed relative strength as banking names paced the advance amid growing hopes for reduced regulations. Another day of steepening in the yield curve also contributed to the sector's strength. The Wall Street Journal reported this afternoon that the Trump administration may consider scrapping portions of the Dodd-Frank Act. Dow components JPMorgan Chase (JPM 76.65, +3.40, +4.6%) and Goldman Sachs (GS 200.87, +8.24, +4.3%) finished at the top of the price-weighted average.
In the industrial sector (+2.1%), aerospace and defense names outperformed as United Technologies (UTX 108.41, +3.60) gained 3.4%. Meanwhile, the Dow Jones Transportation Average finished higher by 1.9% amid strength in rail names. Union Pacific (UNP 97.49, +3.54) rallied 3.8% amid rising commodity prices and expectations for large-scale infrastructure projects.
Biotechnology names outperformed in the health care space (+1.2%), evidenced by the 1.7% gain in the iShares Nasdaq Biotechnology ETF (IBB 289.78, +4.79). The group saw continued buying interest, shrugging off recent concerns regarding potential drug pricing measures. On a related note, Dow component Pfizer (PFE 33.49, +1.37) gained 4.3%.
The Treasury complex finished on a mostly lower note with the long-end of the curve underperforming. The yield on the 2-yr note finished higher by one basis point (0.91%) while the yield on the benchmark 10-yr note rose eight basis points to 2.14%.
Today's trading volume was above the average of 914 million as more than 1.4 billion shares changed hands at the NYSE floor.
Today's economic data included weekly initial claims and the Treasury Budget for October:
- Initial jobless claims produced a positive surprise as they decreased by 11,000 for the week ending November 5 to 254,000 (Briefing.com consensus 262,000).
- Continuing claims for the week ending October 29 increased by 18,000 to 2.041 million.
- The Treasury Budget statement for October showed a deficit of $44.2 billion.
- The Treasury data is not seasonally adjusted so the October deficit cannot be compared to the $136.6 billion deficit in September.
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Economic Data
from Briefing.com| Date | ET | Release | For | Actual | Briefing.com Forecast | Briefing.com Consensus | Prior | Revised From |
|---|---|---|---|---|---|---|---|---|
| Nov 10 | 08:30 | Initial Claims | 11/05 | 254K | 265K | 262K | 265K | -- |
| Nov 10 | 08:30 | Continuing Claims | 10/29 | 2041K | NA | NA | 2023K | 2026K |
| Nov 10 | 10:30 | Natural Gas Inventories | 11/05 | 54 bcf | NA | NA | 54 bcf | |
| Nov 10 | 14:00 | Treasury Budget | Oct | -$44.2B | NA | NA | -$136.6B |
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Technical Update
DOW JONES INDUSTRIAL AVERAGE18807.88 +218.19 (+1.17%)
Volume: 164.39 Mil above average of 94.11 Mil
Range: 18603.14 - 18873.66
S&P500 INDEX
2167.48 +4.22 (+0.20%)
Volume: 997.87 Mil above average of 601.95 Mil
Range: 2151.17 - 2182.3
DOW JONES TRANSPORTATION AVERAGE
8556.6 +159.29 (+1.90%)
Volume: 27.83 Mil above average of 17.02 Mil
Range: 8422.28 - 8611.17
NASDAQ COMPOSITE
5208.799805 -42.27 (-0.80%)
Volume: 2984.36 Mil above average of 1844.72 Mil
Range: 5145.319824 - 5302.680176
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Market Internal
NYSE :Higher than average volume @ 1423.1M vs 906.5M
Decliners outpaced Advancers(adv/dec): 1425M/1631M
New highs outpaced low(high/low): 276/162
NASDAQ :
Higher than average volume @ 2965M vs 1808.0M
Advancers outpaced Decliners(adv/dec): 1750M/1104M
New highs outpaced low(high/low): 370/72
Advancers outpaced Decliners by 1.16 to 1 on higher volumes 4388.1 (+61.66%) than avg 2714 (+1.43%)
VOLATILITY S&P500 (VIX) :
14.74 +0.36 (+2.50%)
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Bonds, Currencies & Commodities
from Briefing.comBonds
Treasuries Drop in Curve-Steepening Trade
- U.S. Treasuries took a drubbing for a second-straight session as investors digested Tuesday's election results and speculated on the possible economic policies of the incoming Trump administration. The U.S. economic data was rather light as initial jobless claims (254K) continue to hover near four-decade lows. The 30-year Treasury auction drew tepid demand, garnering the smallest indirect bid (54.4%) since August 2015. The S&P 500 now trades up 0.47% to 2,173.4 but financials are soaring and the Nasdaq-100 is seeing heavy selling pressure as higher rates frighten some tech investors. The U.S. Dollar Index is up 0.31% to 98.81. The cash Treasury market is closed on Friday for Veterans Day although interest rate futures will trade on the Chicago Mercantile Exchange with normal trading hours
- Yield Check:
- 2-yr: unch at 0.90%
- 5-yr: +6 bps to 1.53%
- 10-yr: +7 bps to 2.12%
- 30-yr: +9 bps to 2.94%
- News:
- Initial jobless claims fell to 254K for the week ending November 5 from the prior reading of 265K. The Briefing.com consensus was 262K
- Continuing jobless claims rose to 2041K for the week ending October 29 from the prior reading of 2023K
- St. Louis Fed President James Bullard said this morning that just one rate hike should be sufficient for the foreseeable future. Bullard votes this year
- Bullard went on to say that December is a reasonable time to hike rates and that the U.S. general election would not affect the decision
- A senior Trump adviser, David Malpass, reiterated the independence of the Federal Reserve today and said that people should "stop talking about the Fed."
- Trump's transition website says that his administration will dismantle Dodd-Frank. Part of the GOP platform in this election cycle called for the reinstatement of Glass-Steagall
- $15 bln 30-year Treasury auction
- High yield: 2.902%
- Bid-to-cover: 2.11
- Indirect bid: 54.4%
- Direct bid: 12.5%
- Initial jobless claims fell to 254K for the week ending November 5 from the prior reading of 265K. The Briefing.com consensus was 262K
- Commodities:
- WTI crude: -1.52% to $44.58/bbl.
- Gold: -1.22% to $1,258/troy oz.
- Copper: +3.35% to $2.542/lb.
- Currencies:
- EUR/USD: -0.37% to 1.0889
- USD/JPY: +1.19% to 106.90
- Data out Friday:
- Michigan Sentiment (10:00 ET)
Currencies
Commodities
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Preview: Friday, 11 November 2016
Economic Data
| Date | ET | Release | For | Actual | Briefing.com Forecast | Briefing.com Consensus | Prior | Revised From |
|---|---|---|---|---|---|---|---|---|
| Nov 11 | 10:00 | Mich Sentiment | Nov | 87.0 | 87.9 | 87.2 |
Other Events of Interest
Earnings
Commentary
Adv/Dec on Par. Higher than average volumes, but lower than the day before.
Direction for 11 Nov 16: UP
Direction for 11 Nov 16: UP
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