Closing Stock Market Summary
The stock market closed this abbreviated week on a strong note on above-average volume at the NYSE. The S&P 500 closed at a fresh record high (4,839.81) with a 1.2% gain. The Dow Jones Industrial Average logged a 1.1% gain and the Nasdaq Composite closed 1.7% higher.
Strong mega cap and semiconductor shares were propping up index gains in the early going while the broader market traded more mixed. Semiconductor and mega cap stocks maintained their outperformance, but by the close, just about everything was trading higher.
The PHLX Semiconductor Index (SOX) jumped 4.0%; the Vanguard Mega Cap Growth ETF (MGK) closed 1.6% higher; the Invesco S&P 500 Equal Weight ETF (RSP) rose 0.8%; the Russell 3000 Growth Index saw a 1.4% gain; and the Russell 3000 Value Index registered a 0.9% gain.
Nine of the 11 S&P 500 sectors closed with a gain and five of them jumped more than 1.0%. In addition to the sectors that house mega cap components, the real estate (+1.0%) and financials (+1.6%) sectors saw the largest gains. The latter was helped in part by a sizable gain in Travelers (TRV 211.67, +13.32, +6.7%), which reported above-consensus earnings and revenue.
The gain in Travelers also offered a measure of support to the Dow Jones Industrial Average.
The only S&P 500 sectors to register a declined were consumer staples (-0.3%) and utilities (-0.1%).
Upside momentum in the stock market picked up steam as Treasuries pulled back from intraday high yields. The 2-yr note yield, which hit 4.42% earlier, settled seven basis points higher at 4.41% and the 10-yr note yield, which tested the 4.20% level, settled unchanged for the day at 4.15%.
- S&P 500: +1.5%
- Nasdaq Composite: +2.0%
- Dow Jones Industrial Average: +0.5%
- S&P Midcap 400: -1.5%
- Russell 2000: -4.1%
Reviewing today's economic data:
- December Existing Home Sales 3.78 mln (consensus 3.80 mln); Prior 3.82 mln
- The key takeaway from the report is that high mortgage rates continue weighing on the overall level of activity, though they have not stopped prices from continuing to climb.
- January Univ. of Michigan Consumer Sentiment - Prelim 78.8 (consensus 68.8); Prior 69.7
- The key takeaway from the report is that the increase in sentiment was accompanied by another drop in year-ahead inflation expectations, which have returned to a level not seen in three years.
Looking ahead, Monday's economic data is limited to the December Leading Indicators Index (consensus -0.3%; prior -0.5%) at 10:00 ET.