Closing Stock Market SummaryThe stock market opened on a high note and extended its gains the whole session, closing at or near session highs. The S&P 500 logged its fourth consecutive winning week and closed above the 4,231 level, which marked a 50% retracement of the losses the market incurred from the Jan. 3 closing level (4796.56) and June 16 closing level (3666.77). Falling oil prices and the better-than-expected preliminary August University of Michigan Consumer Sentiment reading underpinned today's buying efforts.
Also, the Import-Export Price Index for July piled on to the CPI and PPI reports this week, pointing to possible peak inflation.
The S&P 500 was up 3.3% week-to-date; the Nasdaq was up 3.1% week-to-date; the Dow Jones Industrial Average was up 2.9% week-to-date. Including this week's gains, the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average are up 17.7%, 23.5%, and 13.7%, respectively, from their mid-June lows.
The buying effort today was broad based with all 11 S&P 500 sectors closing in the green with gains ranging from 0.8% (energy) to 2.3% (consumer discretionary).
Energy brought up the rear amid falling oil prices. WTI crude oil futures settled the session 2.1% lower to $92.34/bbl. Natural gas futures fell 1.3% to $8.86/mmbtu. Unleaded gasoline futures fell 0.02% to $3.06/gal.
Meanwhile, consumer discretionary (+2.3%), information technology (+2.1%), and communication services (+2.0%) rose to the top of the leaderboard thanks to their outperforming mega cap components. Information technology was also boosted by its semiconductor related constituents, which had a strong showing today. The PHLX Semiconductor Index closed up 3.0%.
Mega caps led the market higher with the Vanguard Mega Cap Growth ETF (MGK) up 2.0% at the close versus a 1.6% gain in the Invesco S&P 500 Equal Weight ETF (RSP). Small and mid cap stocks were not left out of the rally, however. The Russell 2000 (+2.0%) and S&P Mid Cap 400 (+1.5%) closed with sizable gains.
Two names that were left out of the rally effort were Alibaba (BABA 94.77, -0.10, -0.1%) and Pinduoduo (PDD 48.80, -0.82, -1.7%) following news today that five other Chinese ADRs plan to delist at the NYSE.
Separately, the Treasury market was mixed today with the 2-yr note yield rising six basis points to 3.25% while the 10-yr note yield fell four basis points to 2.85%.
Looking ahead to Monday, market participants will receive August Empire State Manufacturing Index (consensus 5.0; prior 11.1) at 8:30 a.m. ET, August NAHB Housing Market Index ( consensus 55; prior 55) at 10:00 a.m. ET, and June TIC Net Long-Term Transactions (prior $155.3 billion) at 4:00 p.m. ET.
Reviewing today's economic data:
- August Univ. of Michigan Consumer Sentiment - Prelim 55.1 (consensus 52.1); Prior 51.5
- The key takeaway from the report is that consumers' inflation expectations were little changed, dipping to 5.0% from 5.2% for the year ahead (but above 4.6% seen a year ago) and edging up to 3.00% from 2.9% for the five-year outlook.
- July import prices fell 1.4% after the revised increase of 0.3% in May (from 0.2%). Import prices, excluding oil, fell 0.5% after the revised decrease of 0.6% in May (from -0.5%). Export prices fell 3.3% after the 0.7% increase in May. Export prices, excluding agriculture, fell 3.3% after a revised 0.8% increase in May (from 0.9%)
Dow Jones Industrial Average: -7.1% YTD
S&P 400: -7.9% YTD
S&P 500: -10.2% YTD
Russell 2000: -10.2% YTD
Nasdaq Composite: -16.6% YTD