Closing Stock Market SummaryThe stock market opened to weakness today due to some profit taking activity following a big run recently. Some of the early weakness could be pinned on mixed earnings results from several influential banks that all featured increased provisions for credit losses.
Bank of America (BAC 35.23, +0.76, +2.2%), JPMorgan Chase (JPM 143.01, +3.52, +2.5%), Wells Fargo (WFC 44.22, +1.39, +3.3%), and Citigroup (C 49.92, +0.83, +1.7%) opened to mixed price action following their earnings reports, but like the broader market, recovered noticeably from levels seen at the start of the session.
Buyers were quick to jump on the opening weakness and controlled the price action for nearly the entirety of today's session. Just about everything reversed from the opening weakness and finished on an upbeat note. The S&P 500, which broke through technical resistance at its 200-day moving average (3,981), closed just shy of the 4,000 level, which is an area it hasn't seen since mid-December.
Resilience to early selling efforts, along with strength in the mega cap space, fueled today's turnaround. The Vanguard Mega Cap Growth ETF (MGK) had been down 0.9% at this morning's low before settling the session with a 0.7% gain. The Invesco S&P 500 Equal Weight ETF (RSP) logged a more modest 0.2% gain while the S&P 500 rose 0.4%.
Tesla (TSLA 122.40, -1.13, -0.9%) went against the grain today after The Wall Street Journal reported the EV maker cut prices in the U.S. for some of its cars by close to 20%, although it stormed back from an opening 6.4% loss.
Despite Tesla's underperformance, the S&P 500 consumer discretionary sector (+1.0%) closed at the top of the leaderboard among the 11 sectors. The financials sector, led higher by the banks that reported earnings, closed just behind the consumer discretionary sector with a 0.7% gain.
Only three sectors -- real estate (-0.6%), utilities (-0.4%), and industrials (-0.1%) -- remained in negative territory by the close.
The 2-yr Treasury note yield rose nine basis points to 4.22% and the 10-yr note yield rose six basis points to 3.51%, giving way to selling interest after a strong start to the year.
- Russell 2000: +7.1% YTD
- S&P Midcap 400: +6.2% YTD
- Nasdaq Composite: +5.9% YTD
- S&P 500: +4.2% YTD
- Dow Jones Industrial Average: +3.5% YTD
Reviewing today's economic data:
- December Import Prices 0.4%; Prior was revised to -0.7% from -0.6%
- December Import Prices ex-oil 0.4%; Prior was revised to -0.3% from -0.4%
- December Export Prices -2.6%; Prior was revised to -0.4% from -0.3%
- December Export Prices ex-ag. -2.7%; Prior was revised to -0.7% from -0.6%
- January Univ. of Michigan Consumer Sentiment - Prelim 64.6 (consensus 60.5); Prior 59.7
- The key takeaway from the report is that consumer sentiment picked up in January on better feelings about personal finances that stemmed from higher incomes and easing inflation.
As a reminder, bond and equity markets are closed Monday for Martin Luther King Jr Day.
Looking ahead to Tuesday, economic data is limited to January Empire State Manufacturing survey (consensus -8.5; prior -11.2) at 8:30 ET.