Closing Market Summary: Stocks End Little Changed Despite Early Slide
The major averages posted modest losses on Thursday, but a daylong rebound off the early lows helped the indices retrace the bulk of the decline. The S&P 500 shed 0.1% with six sectors ending in the red.
Stocks did not waste any time this morning, sliding to session lows within the first 30 minutes of action. All ten sectors participated in the early retreat with financials (-0.3%) leading the market lower.
Earlier this week, the financial sector struggled to keep pace with the broader market, but today's intraday losses were large enough to pressure the S&P 500.
Citigroup (C 47.23, -0.59) was the weakest performer among the majors, while European financials also struggled. Most notably,
Barclays (BCS 14.55, -1.16) fell 7.4% after New York Attorney General announced fraud charges against the company. In addition, news out of the Bank of England related to higher mortgage caps and stricter lending standards may have contributed to the losses.
Like the second-largest sector, the top-weighted technology space (-0.2%) also had a tough time keeping pace with the S&P 500. The tech sector suffered from losses among large cap names like
Google (GOOGL 584.77, -1.16) and
Microsoft (MSFT 41.72, -0.31), while chipmakers fared only a bit better. The PHLX Semiconductor Index slid 0.4%.
On a side note,
GoPro (GPRO 31.34, +7.34) was a bright spot within the sector, soaring 30.6% on its first day as a publically traded company.
Elsewhere, industrials (-0.2%) also lagged amid broad weakness in transport and defense stocks. Notably, the Dow Jones Transportation Average (-0.2%) narrowed its June gain to 0.6%, but it is worth pointing out the bellwether complex soared more than 5.5% last month.
On the upside, four sectors—consumer discretionary (+0.1%), energy (+0.1%), health care (+0.1%), and utilities (+0.2%)—posted slim gains with the utilities space extending its year-to-date gain to 15.1%.
Treasuries spent the bulk of the trading day in the green, ending just below their highs. The 10-yr note added nine ticks, sending its yield lower by tree basis points to 2.53%.
Participation was well below average with less than 600 million shares changing hands at the NYSE.
Economic data was limited to initial claims and income/spending data for May:
- The weekly initial claims level fell to 312,000 from an upwardly revised 314,000 (from 312,000), while the consensus expected a reading of 310,000.
- For most of 2014, the initial claims level was bound between 320,000 and 330,000. Over the past few weeks, claims have come down into the 310,000-320,000 range. The current levels should spark an acceleration in payroll growth and show clear improvement in labor market conditions.
- Personal income levels increased 0.4% in May following a 0.3% increase in April. The consensus expected personal income to increase 0.4%.
- The May employment data showed a 0.4% increase in aggregate wages, which correlated nicely with a 0.4% increase in employee compensation.
- Personal spending increased 0.2% in May after no growth in April. The consensus expected spending to increase 0.4%.
- Adjusted for inflation, spending declined 0.1% on the heels of a 0.2% decline in real PCE in April. That will not factor all that favorably in the calculation for Q2 GDP.
Tomorrow, the final Michigan Consumer Sentiment survey for June will be released at 9:55 ET (consensus 81.7).
- S&P 500 +5.9% YTD
- Nasdaq Composite +4.9% YTD
- Dow Jones Industrial Average +1.6% YTD
- Russell 2000 +1.4% YTD
