Closing Stock Market SummaryToday's trade was indicative of a normal consolidation period after last week's big gains. The major averages floated around the unchanged mark for most of the session before taking a sharp turn lower ahead of the close after the S&P 500 failed to maintain a position above the 4,000 level.
Things were held back today by the belief that the stock market moved too far and too fast last week given that economic and earnings prospects continue to deteriorate and Fed officials continue to talk tough about inflation still being too high.
The latter point was reflected by Fed Governor Christopher Waller (FOMC voter), who said "we've still got a ways to go" before stopping interest rate hikes, according to Bloomberg. To be fair, Fed Vice Chair Brainard said it may 'soon' be appropriate to slow the pace of rate hikes, according to CNBC.
Rising Treasury yields and a strengthening dollar also held back the stock market today. The 2-yr note yield rose 10 basis points to 4.41% and the 10-yr note yield rose five basis points to 3.87%. The U.S. Dollar Index was up 0.5% to 106.86.
Lagging mega cap stocks weighed on index performance. The Vanguard Mega Cap Growth ETF (MGK) closed down 1.2% versus a 0.9% loss in the S&P 500. Amazon.com (AMZN 98.49, -2.30, -2.3%) was a losing standout for the group after the NY Times reported the company plans to eliminate thousands of jobs.
Losses in Amazon and Tesla (TSLA 190.95, -5.02, -2.6%) contributed to the underperformance of the S&P 500 consumer discretionary sector (-1.7%). Hasbro (HAS 57.16, -6.25, -9.9%) exhibited the steepest losses among sector components, however, after the company was downgraded to Underperform from Buy at Bank of America.
The real estate sector (-2.7%) was another top laggard while the health care sector (+0.03%) was alone in positive territory at the close.
Energy complex futures settled the session in mixed fashion. WTI crude oil futures fell 3.5% to $85.83/bbl while natural gas futures rose 0.5% to $6.30/mmbtu.
Ahead of Tuesday's open, Walmart (WMT), Home Depot (HD), KE Holdings (BEKE), Tencent Music (TME), Aramark (ARMK), Sea Limited (SE), and Krispy Kreme, Inc. (DNUT) are among the earnings reporters.
Looking ahead to Tuesday, market participants will receive the following economic data:
- 8:30 ET: October PPI (consensus 0.5%; prior 0.4%), Core PPI ( consensus 0.4%; prior 0.3%), and November Empire State Manufacturing survey consensus -5.0; prior -9.1)
There was no U.S. economic data of note today.
- Dow Jones Industrial Average: -7.7% YTD
- S&P Midcap 400: -11.6% YTD
- Russell 2000: -16.9% YTD
- S&P 500: -17.0% YTD
- Nasdaq Composite: -28.4% YTD