Market Summary
from Briefing.comIndustry Watch
Strong: -
Weak: -
[BRIEFING.COM] The stock market ended Thursday on a mixed note ahead of Friday's Employment Situation report for November (Briefing.com consensus 180,000). The Dow Jones Industrial Average (+0.4%) continued its recent outperformance while the S&P 500 (-0.4%) and Nasdaq (-1.4%) ended in negative territory for the second consecutive day. The Nasdaq extended its weekly decline to 2.7%, settling just below its 50-day moving average (5264) for the first time since November 14.
Equity indices started above their flat lines, but countercyclical sectors and the top-weighted technology group displayed relative weakness from the start. The underperformance in the tech sector took a toll on the Nasdaq Composite while the broader S&P 500 benefited from solid gains in three cyclical groups.
The technology sector (-2.3%), which accounts for nearly 21.0% of the S&P 500, was pressured by daylong selling among high-beta chipmakers. The PHLX Semiconductor Index lost 4.9% with Apple (AAPL 109.47, -1.05) suppliers leading the decline after reports that the tech giant was reducing orders for the iPhone 7 due to weak demand. Apple fell 1.0% while Broadcom (AVGO 162.79, -7.70), Cirrus Logic (CRUS 49.32, -5.68), Qualcomm (QCOM 64.16, -3.97), and Skyworks (SWKS 71.78, -5.07) lost between 4.5% and 10.3%. Following today's profit taking, the PHLX Semiconductor Index remains up 26.1% for the year.
The Nasdaq also had to contend with daylong weakness in biotechnology, which sent the iShares Nasdaq Biotechnology ETF (IBB 269.49, -4.58) lower by 1.7%. However, the broader health care sector (-0.8%) settled a bit closer to its flat line.
Similar to health care, three of the remaining four countercyclical groups spent the day in negative territory. The real estate sector (-1.6%) extended its fourth-quarter loss to 10.2% while utilities (-0.9%) and consumer staples (-0.7%) struggled as yields remained on the rise. The benchmark 10-yr yield rose six basis points to 2.44% while the 2-yr yield increased two basis points to 1.14%.
Besides pressuring defensively-oriented groups, the increase in yields was a supportive factor for the financial sector (+1.7%), which is now up 18.1% in the fourth quarter due to sharp steepening in the yield curve. Sector heavyweights Bank of America (BAC 21.50, +0.38) and JPMorgan Chase (JPM 81.79, +1.62) gained 1.8% and 2.0%, respectively.
Elsewhere on the cyclical side, energy (+0.3%) and industrials (+0.8%) continued their recent outperformance, but the energy sector slid from its high into the close. Crude oil also backed away from its best level of the day, but still settled higher by 3.3% at $51.06/bbl. The energy component is now within striking distance of its 2016 high ($51.93/bbl).
For the second day in a row, the industrial sector (+0.8%) received support from transport stocks. The Dow Jones Transportation Average climbed 0.6% with CSX (CSX 36.62, +0.81) ending among the leaders. Recall that the rail carrier raised its fourth-quarter guidance yesterday.
Today's NYSE floor volume was above the 200-day average of 926 million, as 1.1 billion shares changed hands.
Economic data included Initial Claims, Construction Spending, and ISM:
Equity indices started above their flat lines, but countercyclical sectors and the top-weighted technology group displayed relative weakness from the start. The underperformance in the tech sector took a toll on the Nasdaq Composite while the broader S&P 500 benefited from solid gains in three cyclical groups.
The technology sector (-2.3%), which accounts for nearly 21.0% of the S&P 500, was pressured by daylong selling among high-beta chipmakers. The PHLX Semiconductor Index lost 4.9% with Apple (AAPL 109.47, -1.05) suppliers leading the decline after reports that the tech giant was reducing orders for the iPhone 7 due to weak demand. Apple fell 1.0% while Broadcom (AVGO 162.79, -7.70), Cirrus Logic (CRUS 49.32, -5.68), Qualcomm (QCOM 64.16, -3.97), and Skyworks (SWKS 71.78, -5.07) lost between 4.5% and 10.3%. Following today's profit taking, the PHLX Semiconductor Index remains up 26.1% for the year.
The Nasdaq also had to contend with daylong weakness in biotechnology, which sent the iShares Nasdaq Biotechnology ETF (IBB 269.49, -4.58) lower by 1.7%. However, the broader health care sector (-0.8%) settled a bit closer to its flat line.
Similar to health care, three of the remaining four countercyclical groups spent the day in negative territory. The real estate sector (-1.6%) extended its fourth-quarter loss to 10.2% while utilities (-0.9%) and consumer staples (-0.7%) struggled as yields remained on the rise. The benchmark 10-yr yield rose six basis points to 2.44% while the 2-yr yield increased two basis points to 1.14%.
Besides pressuring defensively-oriented groups, the increase in yields was a supportive factor for the financial sector (+1.7%), which is now up 18.1% in the fourth quarter due to sharp steepening in the yield curve. Sector heavyweights Bank of America (BAC 21.50, +0.38) and JPMorgan Chase (JPM 81.79, +1.62) gained 1.8% and 2.0%, respectively.
Elsewhere on the cyclical side, energy (+0.3%) and industrials (+0.8%) continued their recent outperformance, but the energy sector slid from its high into the close. Crude oil also backed away from its best level of the day, but still settled higher by 3.3% at $51.06/bbl. The energy component is now within striking distance of its 2016 high ($51.93/bbl).
For the second day in a row, the industrial sector (+0.8%) received support from transport stocks. The Dow Jones Transportation Average climbed 0.6% with CSX (CSX 36.62, +0.81) ending among the leaders. Recall that the rail carrier raised its fourth-quarter guidance yesterday.
Today's NYSE floor volume was above the 200-day average of 926 million, as 1.1 billion shares changed hands.
Economic data included Initial Claims, Construction Spending, and ISM:
- Initial claims for the week ending November 26 increased 17,000 to 268,000 (Briefing.com consensus 253,000), marking the 91st straight week they have been below 300,000
- Continuing claims for the week ending November 19 jumped by 38,000 to 2.081 million
- Construction spending increased 0.5% in October (Briefing.com consensus +0.6%) following an upwardly revised unchanged reading (from -0.4%) for September. This will be a positive input when computing Q4 GDP
- The ISM Manufacturing Index rose to 53.2 in November (Briefing.com consensus 52.1) from 51.9 in October
- This was the third straight month that manufacturing activity has expanded and it is the highest reading since June 2016
- Russell 2000 +16.3% YTD
- Dow Jones Industrial Average +10.1% YTD
- S&P 500 +7.2% YTD
- Nasdaq Composite +4.9% YTD
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Economic Data
from Briefing.com| Date | ET | Release | For | Actual | Briefing.com Forecast | Briefing.com Consensus | Prior | Revised From |
|---|---|---|---|---|---|---|---|---|
| Dec 01 | 07:30 | Challenger Job Cuts | Nov | -13.0% | NA | NA | -24.7% | |
| Dec 01 | 08:30 | Initial Claims | 11/26 | 268K | 255K | 253K | 251K | -- |
| Dec 01 | 08:30 | Continuing Claims | 11/19 | 2081K | NA | NA | 2043K | -- |
| Dec 01 | 10:00 | Construction Spending | Oct | 0.5% | 0.3% | 0.6% | 0.0% | -0.4% |
| Dec 01 | 10:00 | ISM Index | Nov | 53.2 | 51.5 | 52.1 | 51.9 | -- |
| Dec 01 | 10:30 | Natural Gas Inventories | 11/26 | -50 bcf | NA | NA | -2 bcf | |
| Dec 01 | 14:00 | Auto Sales | Nov | 5.21M | NA | NA | 5.12M | -- |
| Dec 01 | 14:00 | Truck Sales | Nov | 8.92M | NA | NA | 9.18M | -- |
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Technical Update
DOW JONES INDUSTRIAL AVERAGE19191.93 +68.35 (+0.36%)
Volume: 108.80 Mil above average of 93.29 Mil
Range: 19138.79 - 19214.3
S&P500 INDEX
2191.08 -7.73 (-0.35%)
Volume: 742.05 Mil above average of 604.93 Mil
Range: 2187.44 - 2202.6
DOW JONES TRANSPORTATION AVERAGE
9037.2 +55.55 (+0.62%)
Volume: 17.27 Mil above average of 16.89 Mil
Range: 8976.96 - 9074.63
NASDAQ COMPOSITE
5251.109863 -72.57 (-1.36%)
Volume: 2264.96 Mil above average of 1832.02 Mil
Range: 5238.209961 - 5326.339844
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Market Internal
NYSE :Higher than average volume @ 1145.8M vs 914.4M
Decliners outpaced Advancers(adv/dec): 1118M/1859M
New highs outpaced low(high/low): 228/108
NASDAQ :
Higher than average volume @ 2250M vs 1817.5M
Decliners outpaced Advancers(adv/dec): 1089M/1750M
New highs outpaced low(high/low): 201/75
Decliners outpaced Advancers by 1.64 to 1 on higher volumes 3395.8 (+24.30%) than avg 2732 (+0.79%)
VOLATILITY S&P500 (VIX) :
14.07 +0.74 (+5.55%)
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Bonds, Currencies & Commodities
from Briefing.comBonds
Treasuries Drop Sharply but Recoup Some Losses
- U.S. Treasuries traded broadly lower today after OPEC's supply-cut agreement came into focus but ended well off of session lows as U.S. equities pushed lower and generated a flight-to-quality bid in government bonds. The U.S. economic data was better than expected but sluggish personal spending growth in October caused a sharp reduction in U.S. GDP growth estimates for the fourth quarter. The ADP Employment Change surprised on the upside for November (216K vs. Briefing.com consensus 160K) but included a sharp downward revision to October's reading. Steven Mnuchin is set to be Donald Trump's nominee for Treasury Secretary and he said today that the priorities for the new administration will be corporate tax reform and deregulation. The S&P 500 now trades up 0.03% to 2,205.2 and the U.S. Dollar Index is up 0.54% to 101.48
- Yield Check:
- 2-yr: +2 bps to 1.11%
- 5-yr: +5 bps to 1.82%
- 10-yr: +8 bps to 2.37%
- 30-yr: +7 bps to 3.02%
- News:
- U.S. personal income rose 0.6% m/m in October. The Briefing.com consensus was 0.4% and September's growth was 0.3%
- Personal spending increased by just 0.3% m/m in October, missing the Briefing.com consensus of 0.5%. September's growth was 0.5%
- Core PCE Prices grew 0.1% m/m, in line with the Briefing.com consensus and September's growth rate
- ADP estimated that the U.S. economy added 216K nonfarm jobs in November, well above the Briefing.com consensus of 160K. October's growth was revised down to 119K from 147K
- Goods-producing jobs fell by 11K in November
- Services-providing jobs grew by 228K in November
- U.S. pending home sales grew just 0.1% m/m in October (1.8% y/y), missing the Briefing.com consensus of 0.7%. September's growth was 1.5%
- The Chicago PMI jumped to 57.6 for November from 50.6 for October, beating the Briefing.com consensus of 52.0. November's reading was the highest since January 2015
- Dallas Fed President Kaplan (FOMC voter in 2017) said today that he favors taking action to remove some amount of accommodation but that rate rises should be undertaken "gradually and patiently
- Donald Trump's Treasury Secretary nominee, Steven Mnuchin, said today that he will consider issuing debt with maturities longer than 30 years
- The Fed's Beige Book said that the U.S. economy continued to expand across most of the 12 regions from early October through mid-November
- Demand for manufactured products was mixed during the current reporting period, with the strong dollar being cited as a headwind to more robust demand in a few Districts
- Modest to moderate increases in capital investment are expected in several other Districts
- A tightening in labor market conditions was reported by seven Districts, with modest employment growth on balance
- U.S. personal income rose 0.6% m/m in October. The Briefing.com consensus was 0.4% and September's growth was 0.3%
- Commodities:
- WTI crude: +8.27% to $48.97/bbl.
- Gold: -1.34% to $1,172/troy oz.
- Copper: +0.84% to 2.632/lb.
- Currencies:
- EUR/USD: -0.54% to 1.0599
- USD/JPY: +1.84% to 114.30
- Data out Thursday:
- November Challenger Job Cuts (07:30 ET)
- Initial Jobless Claims for the week ending 11/26 and Continuing Jobless Claims for the week ending 11/19 (08:30 ET)
- October Construction Spending (10:00 ET)
- November ISM Manufacturing Index (10:00 ET)
- Natural Gas Inventories for the week ending 11/26 (10:30 ET)
- November Auto and Truck Sales (14:00 ET)
- Fed Speakers:
- Cleveland Fed President Mester (FOMC voter in 2016) (08:30 ET)
- Dallas Fed President Kaplan (FOMC voter in 2017) (09:00 ET)
Currencies
Commodities
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Preview: Thursday, 1 December 2016
Economic Data
| Date | ET | Release | For | Actual | Briefing.com Forecast | Briefing.com Consensus | Prior | Revised From |
|---|---|---|---|---|---|---|---|---|
| Dec 02 | 08:30 | Nonfarm Payrolls | Nov | 165K | 180K | 142K | 161K | |
| Dec 02 | 08:30 | Nonfarm Private Payrolls | Nov | 155K | 170K | 135K | 142K | |
| Dec 02 | 08:30 | Hourly Earnings | Nov | 0.2% | 0.2% | 0.4% | -- | |
| Dec 02 | 08:30 | Unemployment Rate | Nov | 4.9% | 4.9% | 4.9% | -- | |
| Dec 02 | 08:30 | Average Workweek | Nov | 34.4 | 34.4 | 34.4 | -- |
Other Events of Interest
Earnings
Commentary
Mixed day with mixed internals.
Direction for 2 December 2016:
Direction for 2 December 2016:
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