Closing Stock Market Summary
The market continues to exhibit lackluster price action. Like recent sessions, the major indices made fairly modest moves today. The S&P 500 moved only 21 points between its intraday high and low, ultimately settling with a 0.2% decline.
The muted action is due to a catalyst-void in the market that has participants biding time until the next market-moving event. This may come in the form of earnings news from influential names this afternoon, or the closely-watched Personal Income and Spending report tomorrow at 8:30 ET, which features the Fed's preferred gauge on inflation (the core-PCE Price Index).
There's also a growing feeling among some participants that stocks are due for a pullback after a big run that has many names trading near all-time highs, which contributed to the lackluster action today.
Market breadth favored decliners at the close, but modestly so. Decliners led advancers by a 4-to-3 margin at the NYSE and by a 5-to-3 margin at the Nasdaq.
The movement in the S&P 500 sectors was also limited today, except for the real estate sector, which gained 1.2%, and the communication services sector, which fell 0.9%.
Semiconductor stocks were also an exception in today's lackluster session, underperforming the broader market. The PHLX Semiconductor Index (SOX) slipped 1.1%. NVIDIA (NVDA 776.6, -10.38, -1.3%) and Broadcom (AVGO 1289.42, -6.81, -0.5%) were among the influential laggards from the SOX, along with Applied Materials (AMAT 197.54, -8.32, -2.6%), which traded down after disclosing it received multiple subpoenas from government authorities requesting information relating to certain China customer shipments.
Treasury yields settled lower today, but that didn't translate into support for stocks due to the wait-and-see mentality in front of the Personal Income and Spending report. The 2-yr note yield fell four basis points to 4.67% and the 10-yr note yield fell four basis points to 4.27%.
- S&P 500: +6.3% YTD
- Nasdaq Composite: +6.2% YTD
- Dow Jones Industrial Average: +3.3% YTD
- S&P Midcap 400: +3.1% YTD
- Russell 2000: +0.7% YTD
Reviewing today's economic data:
- The weekly MBA Mortgage Applications Index sank 5.6% following last week's 10.6% drop
- The second estimate for Q4 GDP showed a slight downward revision to 3.2% (consensus 3.2%) from the advance estimate of 3.3%, primarily due to a downward revision to private inventory investment. The GDP Deflator, meanwhile, was revised slightly higher to 1.6% (consensus 1.5%) from the advance estimate of 1.5%.
- The key takeaway from the report is that there was an upward revision to personal spending growth (3.0% versus 2.8% in the advance estimate) that was driven by an upward revision to services spending (to 2.8% from 2.4%), underscoring the resilience of the U.S. consumer, who has been fortified by a solid labor market.
- The weekly MBA Mortgage Applications Index sank 5.6% following last week's 10.6% drop
- The trade deficit increased to $90.2 billion in the advance report for January from $88.5 billion in December.
- Retail inventories rose 0.5% in the advance report for January following a revised 0.6% increase in December (from 0.8%).
- Wholesale inventories declined 0.1% in the advance report for January following a 0.4% increase in December.
Thursday's economic calendar features:
- 8:30 ET: Weekly Initial Claims (consensus 206,000; prior 201,000), Continuing Claims (prior 1.826 mln), January Personal Income (consensus 0.5%; prior 0.3%), Personal Spending (consensus 0.2%; prior 0.7%), PCE Prices (consensus 0.4%; prior 0.2%), and Core PCE Prices (consensus 0.4%; prior 0.2%)
- 9:45 ET: February Chicago PMI (consensus 47.6; prior 46.0)
- 10:00 ET: January Pending Home Sales (consensus 1.0%; prior 8.3%)
- 10:30 ET: Weekly natural gas inventories (prior -60 bcf)