Closing Stock Market SummaryThe stock market started the session on a decidedly upbeat note, attempting to recover some of the sharp declines registered yesterday. The upside momentum started to dissipated, though, after the S&P 500 briefly tipped above the 4,000 level at its high for the day.
Still, the main indices remained in positive territory until an uptick in selling interest without an obvious catalyst dragged the market into negative territory in the late afternoon. Ultimately, the main indices closed in the green, but well off their highs for day, thanks to notable strength in some heavily-weighted components.
Investors were still digesting the Fed's latest rate hike and commentary from Fed Chair Powell today along with rate hikes from central banks overseas.
Briefly, the Bank of England announced a 25-bps rate hike and hinted at more increases in the future while central banks from Switzerland, Norway, Hong Kong, and Philippines also hiked their policy rates. The Swiss National Bank also said the country's bank crisis is over.
Initially, buying interest was broad in nature with mega cap stocks in a leadership position. By the close, most mega cap stocks maintained a leadership position while the broader market deteriorated. The Vanguard Mega Cap Growth ETF (MGK) was up 1.1% versus a 0.3% decline in the Invesco S&P 500 Equal Weight ETF (RSP).
Strikingly, consumer-oriented Tesla (TSLA 192.22, +1.07, +0.6%) and Amazon.com (AMZN 98.71, +0.01, +0.01%) were exceptions in regards to mega cap leadership, having fallen into negative territory around the same time that the main indices fell below their flat lines.
Bank stocks again fell under notable pressure as the market deteriorated. The SPDR Bank ETF (KBE) declined 2.5% and the SPDR Regional Bank ETF (KRE) fell 2.8%.
Only two of the S&P 500 sectors were able to close with a gain -- information technology (+1.7%) and communication services (+1.8%) -- while the energy (-1.4%), utilities (-1.0%), and financials (-0.7%) fell to the bottom of the pack.
The 2-yr note yield fell 11 basis points today to 3.78% and the 10-yr note yield fell nine basis points to 3.41%.
- Nasdaq Composite: +12.6% YTD
- S&P 500: +2.8% YTD
- S&P Midcap 400: -1.8% YTD
- Russell 2000: -2.3% YTD
- Dow Jones Industrial Average: -3.1% YTD
Reviewing today's economic data:
- Initial jobless claims for the week ending March 18 decreased by 1,000 to 191,000 (consensus 204,000) while continuing jobless claims for the week ending March 11 increased by 14,000 to 1.694 million from last week's revised level of 1.680 million (from 1.684 million).
- The key takeaway from the report is that initial claims remain at a low level, pointing to little recent change in the health of the labor market.
- Q4 current account balance rose to -$206.8 billion from a revised -$219 billion (from -$217.1 billion).
- New home sales increased 1.1% month-over-month in February to a seasonally adjusted annual rate of 640,000 units (consensus 650,000) from a downwardly revised 633,000 (from 670,000) in January. On a year-over-year basis, new home sales were down 19.0%.
- The key takeaway from the report is that sales activity edged up for the fourth time in the past five months, though the February increase was assisted by a downward revision to the sales total from January.
- Weekly EIA Natural Gas Inventories showed a draw of 72 bcf versus a draw of 58 bcf last week.
Market participants will receive the following economic data on Friday:
- 8:30 ET: February Durable Orders ( consensus 1.6%; prior -4.5%) and Durable Orders ex-transportation (Briefing.com consensus 0.3%; prior 0.7%)
- 9:45 ET: Preliminary March IHS Markit Manufacturing PMI (prior 47.3) and preliminary March IHS Markit Services PMI (prior 50.6)