Closing Stock Market SummaryThe stock market spent most of the session oscillating in a narrow range that included modest losses for the Dow, Nasdaq, and S&P 500. Investors were lacking conviction ahead of a slate of earnings news this week. Earnings results so far have been better than expected/feared, which helped limit selling interest, but valuation concerns kept the market from moving noticeably higher.
The market was able to log modest gains, though, thanks to a late afternoon rebound effort. The upside move coincided with a CNN reporter tweeting that House Speaker McCarthy said he thinks he has the 218 votes needed in the House to raise the debt ceiling. The sentiment shift may have been overdone, however, when considering that House Speaker McCarthy told CNBC earlier that a "no strings attached" debt ceiling increase will not pass the House. A proposal with strings attached (e.g., spending cuts in exchange for raising the debt ceiling) is unlikely to pass the Senate.
Still, the major indices all finished at their best levels of the day, leaving the S&P 500 just above 4,150. Even semiconductor equipment makers, which had been a notable pocket of weakness, came along for the afternoon rebound. The PHLX Semiconductor Index (SOX) was down as much as 1.5%, but closed with a modest 0.1% loss.
Weakness in the SOX was stemming from a Bloomberg report that Taiwan Semiconductor Manufacturing Co. (TSM 87.99, +0.79, +0.9%) may soon announce a cut in its FY23 capex budget to $28-32 billion from $32-36 billion.
Notably, Alphabet (GOOG 106.42, -3.04, -2.8%) still logged a sizable decline today despite the broader market improving before the close. This followed a New York Times piece that suggested Samsung is considering using Microsoft's (MSFT 288.80, +2.66, +0.9%) Bing as the default search engine on its devices as opposed to Google.
Most of the S&P 500 sectors were able to close with a gain led by real estate (+2.2%) and financials (+1.1%). Meanwhile, the energy (-1.3%) and communication services (-1.3%) sectors were the worst performers by a wide margin.
Separately, Treasuries settled with losses across the curve as the specter of the Fed raising rates again in May and then not pivoting to a rate-cut cycle anytime soon, along with a stronger-than-expected New York Empire State Manufacturing Survey for April, prompted some selling interest. The 2-yr note yield rose eight basis points to 4.18% and the 10-yr note yield rose seven basis points to 3.59%, unmoved in large part by the aforementioned tweet related to the debt ceiling conversation.
- Nasdaq Composite: +16.2% YTD
- S&P 500: +8.1% YTD
- Russell 2000: +3.2% YTD
- Dow Jones Industrial Average: +2.5% YTD
- S&P Midcap 400: +2.4% YTD
Reviewing today's economic data:
- April Empire State Manufacturing 10.8 (consensus -19.0); Prior -24.6
- April NAHB Housing Market Index 45 ( consensus 45); Prior 44
Looking ahead to Tuesday, market participants will receive the following economic data:
- 8:30 ET: March Housing Starts (consensus 1.458 mln; prior 1.450 mln) and Building Permits ( consensus 1.407 mln; prior 1.524 mln)