Closing Stock Market SummaryThe stock market had another disappointing session to close out a disappointing year. The main indices remained pinned in negative territory today amid thinner holiday trading conditions, but to be fair, pared their losses in a substantive way thanks to a rally effort in the final hour.
The initial move lower was driven by stocks seeing a reversal of yesterday's gains with acute weakness in the mega cap space, many of which aren't so "mega" any more given the massive loss in market capitalization they have suffered this year.
The Vanguard Mega Cap Growth ETF (MGK) fell 0.2% today, but had been down as much as 1.6%. For the year it declined 34.0%.
Selling efforts picked up again around 1:00 p.m. ET without a news catalyst. That down leg saw the S&P 500 hit, and bounce off, the 3,800 level. With lighter volume, the market can be vulnerable to abrupt shifts in action. Those shifts can happen upward just as easily as they happen downward, and that is exactly what happened in the last hour of the session.
Some of the same mega cap names that drove the downside moves today ended up registering a gain. Apple (AAPL 129.93, +0.32, +0.3%), Tesla (TSLA 123.18, +1.36, +1.1%), and Meta Platforms (META 120.34, +0.08, +0.1%) were among the winning standouts for the group. Notwithstanding today's positive finish for these names, they still lost 26.8%, 65.0%, and 64.2%, respectively, this year.
Ten of the 11 S&P 500 sectors closed in the red with the real estate (-1.0%) and utilities (-1.0%) sectors showing the steepest losses. Fittingly, the S&P 500 energy sector (+0.8%) was alone in positive territory, bolstered by rising oil prices. WTI crude oil futures rose 2.0% to $80.05/bbl. The energy sector was the only S&P 500 sector to end 2022 higher (+59.0%).
Treasuries were also weaker today, keeping with how most of 2022 has gone for that market. The 2-yr note began the year at 0.73%, but settled at 4.42%, up five basis points. The 10-yr note began the year at 1.51% and closed today's session at 3.88%, up five basis points.
- Dow Jones Industrial Average: -8.8% YTD
- S&P Midcap 400: -14.5% YTD
- S&P 500: -19.4% YTD
- Russell 2000: -21.6% YTD
- Nasdaq Composite: -33.1% YTD
Today's economic data was limited to the December Chicago PMI, which checked in at 44.9 (Briefing.com consensus 40.0) versus 37.2 in November. The report was better than expected, although a number below 50.0 still connotes a contraction in general business conditions for the manufacturing sector in the Chicago Fed region.
Looking ahead to Tuesday, market participants will receive the following economic data:
- 9:45 a.m. ET: IHS Markit Manufacturing PMI final for December reading (prior 46.2)
- 10:00 a.m. ET: Construction Spending for November (prior -0.3%)