Updated: 06-27-2016

The Market at 04:15PM ET
Dow: -260.51… | Nasdaq: -113.54… | S&P: -36.87…
NASDAQ Vol: 2.147 bln… Adv: 437… Dec: 2149…
NYSE Vol: 1.271 bln… Adv: 586… Dec: 2496…

Moving the Market

Risk-off posture persists post-Brexit

Global financial names pace retreat

Dollar strengthens as pound and euro slide

The heavily-weighted financial, technology, and industrial sectors lead the downside 

Sector Watch
Strong: Utilities, Telecom Services
Weak: Financials, Industrials, Materials, Technology, Consumer Discretionary

04:15PM ET

[BRIEFING.COM] The stock market began its week on a lower note as investors eyed the potential implications of the United Kingdom leaving the European Union. The decision has had far reaching consequences across capital markets as investors look for clues to the potential timing and terms of the official breakup. Additional focal points impacting today's trade included strengthening in the dollar, a downturn in oil, and the underperformance of the heavyweight financial (-2.8%), technology (-2.3%), and industrial (-2.3%) spaces. The Nasdaq Composite (-2.4%) ended its day behind the S&P 500 (-1.8%) and the Dow Jones Industrial Average (-1.5%).

The major U.S. averages began under pressure as investors eyed a continued downturn in European bourses. European equity markets stumbled for the second straight session as investors maintained their risk-off posture. Specifically, British banking names led the losses as concerns mounted regarding how a Brexit may impact lenders in the region and the potential effects of an elongated period of low interest rates. Additionally, Barclays (BCS 7.03, -1.86) plunged 20.9% after numerous firms downgraded the stock post-Brexit.

The S&P 500 (-1.8%) gapped down at the beginning of the session, slipping alongside weakness in heavily-weighted financials (-2.8%), technology (-2.3%), and industrials (-2.43). The benchmark index tested technical support at the psychological 2000 price level in the opening hour and continued to trade near that level for most of the session. Equities carved out fresh intraday lows in the final hour of trade, but were able to finish the day above those levels. Eight sectors ended in negative territory with commodity-sensitive materials (-3.4%) trailing financials (-2.8%), energy (-2.5%), and technology (-2.3%). Conversely, countercyclical utilities (+1.3%) and telecom services (+0.6%) ended in the green.

The economically-sensitive financial sector (-2.8%) demonstrated broad-based weakness as it traded lower in sympathy with European banking names. In the sector, asset management companies and life insurance names showed the largest losses as Bank of New York Mellon (BK 35.88, -2.11) and MetLife (MET 36.53, -2.91) fell 5.6% and 7.4%, respectively. Elsewhere, Dow component American Express (AXP 57.67, -2.39) finished at the bottom of the price-weighted index.

The high-beta chipmakers demonstrated relative weakness, evidenced by the 4.0% decline in the PHLX Semiconductor Index. The Semiconductor Index has lost 7.3% this month, compared to a loss of 4.6% in the benchmark index over that time. In the technology space (-2.3%), large cap components Microsoft (MSFT 48.43, -1.40) and Facebook (FB 108.99, -3.08) underperformed, declining 2.8% apiece.

The energy sector (-2.5%) ended its day under pressure as investors weighed a 2.4% ($46.48/bbl; -$1.12) decline in crude oil. In the group, independent oil and gas names underperformed as the sub-group faces steeper downside risks from a prolonged downturn in crude oil. Elsewhere, Dow component Exxon Mobil (XOM 8886, -0.53) lost 0.6%.

The Dow Jones Transportation Average (-3.1%) finished behind the benchmark index as airlines underperformed. The U.S. Global Jets ETF (JETS 19.85, -0.82) lost 4.0% today, extending its monthly decline to 13.7%.

The U.S. Dollar Index (96.43, +0.98) ended higher by 1.0% as the greenback gained over commodity currencies, the euro, and the pound. The euro/dollar pair ended lower by 0.9% (1.1020) while sterling lost 3.4% (1.3209) against the buck. Separately, the dollar lost 0.1% against the safe haven yen (102.09). 

The Treasury complex ended near its best level of the day as the yield on the 10-yr note slipped ten basis points to 1.46%. 

Today's participation was above the recent average as more than 1.2 billion shares changed hands on the NYSE floor. 

Today's economic data was limited to the International Trade in Goods Report for May: 

  • May International Trade in Goods showed a deficit of $60.59 billion, compared to the April deficit of $57.53 billion.

Tomorrow's economic data will include the third estimate of first quarter GDP (Briefing.com consensus 1.0%) and the third estimate for the first quarter GDP deflator (Briefing.com consensus 0.6%), which will both be released at 8:30 ET. Separately, the Case-Schiller 20-city index for April (Briefing.com consensus 5.5%) and Consumer Confidence for June (Briefing.com consensus 93.1) will cross the wires at 9:00 ET and 10:00 ET, respectively. 

  • Nasdaq -8.3% YTD
  • Russell 2000 -4.0% YTD
  • S&P 500 -2.1% YTD
  • Dow Jones -1.6% YTD 
Dow: -260.51… | Nasdaq: -113.54… | S&P: -36.87…
NASDAQ Adv/Dec 437/2149. …NYSE Adv/Dec 586/2496.

03:30PM ET
[BRIEFING.COM]
  • The dollar index continues clocking in massive gains, up another +1% in addition to Friday's +2% gains, near the 96.46 level, weighing on commodities
    • Commodities, as measured by the Bloomberg Commodity Index, are down -0.3% at 86.66
  • Crude oil closes near session lows, seeing a sharp spike within the last 10 min of pit trading close, possibly due to short covering
    • August crude oil futures fell $1.12 (-2.4%) to $46.48/barrel
    • EIA crude oil inventory data is scheduled to be released Wednesday at 10:30 am ET
    • API data is scheduled to be released tomorrow at 4 pm ET
    • Reminder: Friday's Baker Hughes total U.S. rig count was down 3 to 421 rigs following last week's increase of 10 rigs
    • Monthly IEA data is scheduled to be released on July 13
  • Natural gas rallies and closes near fresh session highs despite extremely notable strength in the dollar index
    • August natural gas closed $0.05 higher (+1.9%) at $2.74/MMBtu
    • EIA natural gas inventory data is scheduled to be released Thursday at 10:30 am ET.
  • In precious metals, gold manages to close higher despite extremely notable strength in the dollar index as investors/traders flee to safety amidst a broad market sell-off
    • August gold ended today's session up $2.10 (+0.2%) to $1324.60/oz
    • On Friday, gold futures closed up +5% for the day
    • The dollar index is up +1%, around the 96.37 level
  • Silver trades near parity with the previous close, down slightly on the day
    • July silver closed today's session $0.03 lower (-0.2%) at $17.75/oz
  • Base metal copper inches higher in afternoon pit trading
    • July copper closed $0.01 higher (+0.5%) at $2.12/lb
  • Corn & soybean futures close higher while wheat futures closed lower ahead of the USDA crop report to be released today at 4 pm ET
    • December corn closed $0.01 higher (+0.3%) at $3.86/bushel
      • Corn has changed its front month to December from July, as indicated by the active amount of volume in the contracts
      • Corn prices have declined in the past five consecutive sessions, falling $0.53, or 12.1%, to $3.85/bushel, largely as the supply outlook for some crops have improved
    • September wheat closed $0.07 lower (-1.5%) at $4.58/bushel
    • November soybeans closed $0.23 higher (+2.1%) at $11.07/bushel
      • Recent weather highlights:
        • In the Corn Belt, additional showers on top of recent locally heavy rain are further improving moisture supplies for corn and soybeans from eastern Iowa into Ohio
        • Soil moisture remains limited, however, across central and southern Michigan and on the triple point between Iowa, Missouri, and Illinois
        • In the South, showers and thunderstorms linger in the northern Delta and along the central Gulf Coast. Moderate to severe drought persists, however, from the eastern Delta into the southern Appalachians.
Dow: -258.83… | Nasdaq: -112.13… | S&P: -36.05…
NASDAQ Adv/Dec 436/2439. …NYSE Adv/Dec 583/2490.

03:00PM ET

[BRIEFING.COM] As the stock market enters its final hour of trade, the Nasdaq Composite (-2.8%) trails the S&P 500 (-2.1%) and the Dow Jones Industrial Average (-1.8%). The three indices sport monthly losses between 3.9% and 7.8%.

Eight sectors trade in the red with commodity-sensitive materials (-3.6%) and energy (-2.8%) leading the downside. The remaining decliners show losses between 2.0% (consumer discretionary) and 2.7% (financials). On the flipside, countercyclicals sectors outperform with utilities (+1.3%) and telecom services (+0.4%) leading the pack.

The consumer staples (-0.3%) sector shows the slimmest loss as consumer product and food names benefit from safe-haven inflows. On that note, Clorox (CLX 137.11, +2.23) and Tyson Foods (TSN 65.28, +1.71) have gained 1.6% and 2.7%, respectively. Elsewhere, Dr Pepper Snapple (DPS 95.38, +3.20) has jumped 3.5%. The broader sector has gained 0.7% this month, trailing only utilities (+1.4%; month-to-date: +4.6%) and telecom services (+0.3%; month-to-date: +6.0%) over that period.

WTI crude ended its day lower by 2.4% ($46.48/bbl; -$1.12).

Dow: -312.21… | Nasdaq: -128.74… | S&P: -42.68…
NASDAQ Adv/Dec 403/2946. …NYSE Adv/Dec 515/2542.

02:30PM ET

[BRIEFING.COM] The major indices have floated lower since our last update as the S&P 500 (-2.0%) trades six points off its worst level of the day. Separately, the Russell 2000 (-3.1%) trades behind the Nasdaq Composite (-2.5%).

The commodity-sensitive materials (-3.7%) and energy (-3.1%) sectors trail the broader market as strengthening in the greenback weighs on dollar-denominated commodities. WTI crude sports a loss of 2.9% ($46.24/bbl; -$1.40) ahead of its pit session close at 14:30 ET.

In the energy space (-3.1%), independent oil and gas names demonstrate relative weakness as ConocoPhillips (COP 40.69, -2.47) and Anadarko Petroleum (APC 48.99, -3.84) fall 5.7% and 7.3%, respectively. On the flipside, Dow component Exxon Mobil (XOM 88.27, -1.12) has lost 1.2%, extending its June decline to 0.8%. The broader energy sector has declined 3.0% so far this month.

The U.S. Dollar Index (96.56, +1.12) has inched its back towards its session high as the euro and Canadian dollar extend their losses against the buck. The euro/dollar pair trades lower by 1.1% (1.0999) while the dollar has gained 0.8% against the Canadian dollar (1.3109).

Dow: -294.75… | Nasdaq: -116.61… | S&P: -39.79…
NASDAQ Adv/Dec 444/2852. …NYSE Adv/Dec 530/2512.

02:00PM ET

[BRIEFING.COM] The major averages have slipped lower in recent action as the S&P 500 (-1.9%) tests technical support near the psychological 2000 price level. The leg lower in the broader market corresponded with news indicating Standard & Poor's has cut the United Kingdom's credit rating to AA from AAA.

In the consumer discretionary space (-1.9%), retail names demonstrate relative weakness, evidenced by the 2.3% decline in the SPDR S&P Retail ETF (XRT 40.08, -1.02). In the group, L Brands (LB 64.99, -2.49) has lost 3.7% while Dow component Nike (NKE 51.75, -0.84) trades ahead of the broader sector and price-weighted index. The footwear multinational is scheduled to report earnings tomorrow evening. Elsewhere, homebuilders underperform as the iShares Dow Jones US Home Construction ETF (ITB 26.14, -0.64) loses 2.4%.

On the commodities front, gold ended its day higher by 0.2% ($1,324.60/ozt; +$2.10) as the precious metal extends its winning streak courtesy of safe-haven inflows. Conversely, the CBOE Volatility Index (23.59, -2.17) trades off its session low (23.28), paring gains from Friday's 49.3% rally.

Dow: -290.57… | Nasdaq: -114.98… | S&P: -39.34…
NASDAQ Adv/Dec 444/2800. …NYSE Adv/Dec 524/2521.

01:30PM ET

[BRIEFING.COM] The major U.S. indices have continued to tick higher off this morning's lows, but still show meaningful losses in afternoon trading as global concerns following the EU referendum vote remain.

A look inside the Dow Jones Industrial Average shows that American Express (AXP 57.85, -2.21), DuPont (DD 63.88, -2.12), and JPMorgan (JPM 57.85, -1.75) are underperforming. DuPont and peers are under strong pressure as materials put in today's worst sector performance, while financials similarly trade lower than the broader market on BREXIT fears. 

Conversely, Johnson & Johnson (JNJ 116.33, +0.70) is the best-performing Dow component as investors flock to safe dividend plays amid the turbulent market conditions. 

Extending losses from Friday, the DJIA is now down 3.5% in June. 

Dow: -237.4… | Nasdaq: -98.11… | S&P: -33.39…
NASDAQ Adv/Dec 464/2703. …NYSE Adv/Dec 549/2487.

01:10PM ET

[BRIEFING.COM] The stock market trades on a broadly lower note at midday as investors continue to weigh fallout from the United Kingdom's referendum to exit the European Union. Other focal points of today's action have included a risk-off posture, strengthening in the dollar, and the underperformance of the heavily-weighted financial (-2.5%), technology (-2.2%), industrial (-2.0%), and consumer discretionary (-1.8%) sectors. At midday, the Nasdaq Composite (-2.2%) trades behind the S&P 500 (-1.8%) and the Dow Jones Industrial Average (-1.5%).

European equity markets moved lower overnight, extending sharp losses from the prior week. Specifically, European banking names were under pressure as participants began to weigh the potential timing and terms of the U.K.'s formal exit from the single market. On that note, Royal Bank of Scotland (RBS 4.82, -0.61) and Barclays (BCS 7.13, -1.75) have declined 11.3% and 19.8%, respectively. Additionally, sovereign bond yields remained pressured as the U.K.'s 10-yr gilt yield notched a new all-time low (0.93%) overnight.

The major averages opened under pressure as heavily-weighted financials (-2.5%), technology (-2.2%), industrials (-2.0%). and consumer discretionary (-1.8%) slipped down the leaderboard. As a result, the benchmark index broke several technical support levels before finding support near the 1991 area. The S&P 500 (-1.8%) notched a new session low (1991.59) shortly before the close of trade in Europe, but was able to inch off that level soon thereafter. At midday, eight sectors trade in the red with commodity-sensitive materials (-3.2%) and energy (-2.7%) leading the downside. The remaining cyclical sectors sport losses between 1.9% (consumer discretionary) and 2.5% (financials). 

The economically-sensitive financial sector (-2.4%) shows broad-based weakness as it trades lower with European banking names. In the group, asset management names, money center banks, investment brokerages, and life insurance companies show the largest losses. Dow component American Express (AXP 57.79, -2.27) has declined 3.8% as it rounds out the price-weighted index.

In the technology space (-2.2%), the high-beta chipmakers demonstrate relative weakness, evidenced by the 3.8% decline in the PHLX Semiconductor Index. The growth-sensitive group has been under pressure throughout June, extending its loss to 7.1% over that period. This compares to a decline of 4.5% in the benchmark index over that time. Elsewhere, data storage names underperform as Seagate Technology (STX 21.22, -1.93) and Western Digital (WDC 43.20, -4.64) lose 8.3% and 9.7%, respectively.

The Dow Jones Transportation Average (-2.9%) trades behind the broader market as airline names round out the index. The group continues to see pressure as companies with international exposure extend their losses. The U.S. Global Jets ETF (JETS 19.96, -0.70) has lost 3.4% today. Separately, rail names underperform with CSX (CSX 24.76, -0.94) and Norfolk Southern (NSC 79.92, -2.72) losing 3.4% apiece.

The U.S. Dollar Index (96.35, +0.90) has gained 0.9% today as the greenback extends its lead over commodity currencies, the euro, and the pound. The dollar/Canadian dollar pair trades higher by 0.7% (1.3090) amid a 3.2% downturn in crude oil ($46.14, -1.50). Separately, the pound trades lower by 3.5% against the dollar (1.3202).

The Treasury complex floats near its best level of the day as the yield on the 10-yr note slips ten basis points to 1.46%.

Today's economic data was limited to the International Trade in Goods Report for May: 

  • May International Trade in Goods showed a deficit of $60.59 billion, compared to the April deficit of $57.53 billion.
Dow: -253.90… | Nasdaq: -101.15… | S&P: -35.53…
NASDAQ Adv/Dec 472/2669. …NYSE Adv/Dec 542/2483.

12:25PM ET

[BRIEFING.COM] The major indices have traded sideways since our last update as the S&P 500 (-1.7%) trades behind the Dow Jones Industrial Average (-1.3%).

The Nasdaq Composite (-213%) underperforms today amid continued weakness in the technology (-2.1%) and biotechnology groups. On that note, the iShares Nasdaq Biotechnology ETF (IBB 243.45, -5.59) trades lower by 2.3%, compared to a loss of 1.1% in the broader health care space.

In the health care sector (-1.1%), Dow component Johnson & Johnson (JNJ 116.09, +0.46) demonstrates relative strength, gaining 0.4%. The stock trades neck-and-neck with Verizon (VZ 54.66, +0.22) at the top of the price-weighted index. Conversely, health care plan and service names underperform with Express Scripts (ESRX 73.26, -2.14) and CIGNA (CI 122.50, -5.21) losing a respective 2.8% and 4.1%.

The U.S. Dollar Index (95.32, +1.79) trades higher by 1.0% on the day as commodity currencies, the euro, and the pound lose ground to the greenback. The euro/dollar pair trades lower by 0.8% (1.1025), trimming its loss since the close of trade in Europe. Separately, the dollar has made up some ground against the yen, but it remains lower by 0.5% (101.72).

Dow: -233.39… | Nasdaq: -102.50… | S&P: -33.61…
NASDAQ Adv/Dec 413/2680. …NYSE Adv/Dec 492/2519.

12:00PM ET

[BRIEFING.COM] The major averages have climbed higher in recent trade as the Nasdaq Composite (-2.2%) trades behind the S&P 500 (-1.7%). The move higher in equities corresponded with the close of trade in Europe.

The commodity-sensitive materials sector (-3.1%) has trimmed it loss in recent trade as it trails financials (-2.6%), technology (-2.2%), and consumer discretionary (-2.0%).

In the technology sector (-2.2%), large cap components Microsoft (MSFT 48.61, -1.21) and Facebook (FB 109.15, -2.93) demonstrate relative weakness, losing 2.5% and 2.6%, respectively. Elsewhere, Dow component IBM (IBM 143.50, -3.09) trades ahead of the broader sector after receiving a contract from the Department of Defense valued at $320 million. The high-beta chipmakers underperform, evidenced by the PHLX Semiconductor Index declining 4.1%. For the month of June, the Semiconductor Index shows a loss of 7.3%, which falls in-line with the loss in the broader tech space over that time.

On the commodities front, WTI crude trades lower by 2.8% ($46.30/bbl; -$1.34) while gold trades flat at $1,323.20/ozt.

Dow: -254.52… | Nasdaq: -107.41… | S&P: -35.66…
NASDAQ Adv/Dec 403/2656. …NYSE Adv/Dec 455/2538.

11:30AM ET

[BRIEFING.COM] The S&P 500 (-2.0%) hovers five points above its session low while the domestically-oriented Russell 2000 (-3.4%) underperforms after Friday's rebalancing.

Eight sectors show losses with financials (-3.0%) trading neck-and-neck with materials (-3.1%) on the bottom of the leaderboard. The remaining cyclical sectors sport losses between 2.2% (technology) and 2.5% (energy).

The economically-sensitive financial sector (-3.0%) demonstrates broad-based weakness as the space trades lower in sympathy with global banking names. On that note, Barclays (BCS 6.82, -2.07) has tumbled after receiving downgrades at Jefferies, BofA/Merrill Lynch, JP Morgan, and Exane BNP Paribas following last week's Brexit referendum. The stock has lost 23.2% today, extending its June loss to 35.5%. In the sector, Dow components JPMorgan Chase (JPM 57.27, -2.32) and American Express (AXP 57.53, -2.53) round out the price-weighted index, declining 3.9% and 4.2%, respectively.

The Treasury complex floats near its best level of the day as the yield on the 10-yr note slips nine basis points to 1.47%. For the month, the yield on the 10-yr note has tumbled 38 basis points.

Dow: -299.85… | Nasdaq: -120.58… | S&P: -41.12…
NYSE Adv/Dec -2.6/-2.0.

11:05AM ET

[BRIEFING.COM] The major averages have ticked lower in recent trade as the S&P 500 (-2.2%) trades at a new session low. The downtick in U.S. equities occurred alongside a similar move in European bourses as investors reacted to recent remarks from David Cameron, who will continue serving as the U.K. prime minister until September after resigning on Friday.

Mr. Cameron recently addressed parliament, outlining a plan for the country moving forward. Mr. Cameron indicated that there would not be another vote on leaving the EU and that the process of exiting will begin once he has left office in September. Furthermore, the Prime Minister warned that markets will likely remain volatile, but urged that the country maintain the strongest possible links with the EU.

The U.S. Dollar Index (96.62, +1.17) trades at a fresh session high as the euro and the pound extend their losses against the greenback. The single currency has slipped 1.2% against dollar (1.0983), slipping back towards its low. Elsewhere, sterling has slumped in recent trade, losing 3.8% (1.3163) against the greenback.

Dow: -328.79… | Nasdaq: -129.49… | S&P: -45.08…
NASDAQ Adv/Dec 332/2587. …NYSE Adv/Dec 249/2598.

10:30AM ET
[BRIEFING.COM]
  • The dollar index sees a notable continuation rally after the result of Friday's UK referendum vote, up +0.9% at 96.29, weighing on commodities
    • Commodities, as measured by the Bloomberg Commodity Index, are down -0.1% at 86.88
  • Crude oil extends Friday's losses post-Brexit, finding support this session near the $46.50/barrel level, weighing on energy-related stocks
    • July crude oil futures are down $0.99 (-2.1%) at $46.63/barrel
    • API data is scheduled to be released tomorrow after the bell
    • EIA petroleum data is scheduled to be released at 10:30 am ET on Wednesday
    • Monthly IEA data is scheduled to be released July 13th
    • Reminder: Friday's Baker Hughes total U.S. rig count was down 3 to 421 rigs following last week's increase of 10 rigs
  • Natural gas rallies to fresh highs of the day in morning pit trading as the dollar surges
    • July natural gas futures are up $0.04 (+1.6%) at $2.74/MMBtu
    • EIA natural gas inventory data is scheduled to be released Thursday at 10:30 am ET
  • In precious metals, gold extends Friday's notable +5% gains as investors/traders adopt a flight-to-safety mentality amidst uncertainty in the UK
    • August gold futures are up $6.70 (+0.5%) at $1329.10/oz
  • Silver trades sideways, near parity with the close of the previous session as investors/traders continue to digest & interpret the consequences of the UK referendum vote
    • July silver futures are up $0.03 (+0.2%) at $17.82/oz
  • Base metal copper inches higher in morning pit trading
    • July copper futures are up $0.02 (+0.7%) at $2.13/lb
Dow: -273.90… | Nasdaq: -100.47… | S&P: -37.18…
NASDAQ Adv/Dec 355/2318. …NYSE Adv/Dec 368/2547.

10:05AM ET

[BRIEFING.COM] The major averages float above their opening lows as the Nasdaq Composite (-1.5%) continues to lag the S&P 500 (-1.3%). The benchmark index trades three points off its worst level of the day.

The leaderboard remains little changed with heavily-weighted financials (-2.2%) and industrials (-1.7%) leading the retreat. On the flipside, utilities (+0.1%) trimmed their gain as the group hovers above its flat line.

In the consumer discretionary space (-1.3%), global cruise ship names continue to underperform as Carnival (CCL 43.88, -1.77) slides 3.9%. The company is scheduled to report earnings tomorrow morning. The broader sector has declined 4.9% this month, compared to a loss of 4.1% in the benchmark index over that time. 

The U.S. Dollar Index (96.41, +0.97) trades off its best level of the day as the euro and pound show sizable losses against the greenback. The euro/dollar pair trades lower by 1.0% (1.1004) while sterling has lost 3.4% against the buck (1.3209). Separately, the dollar/yen pair trades lower by 0.6% (101.63).

Dow: -226.99… | Nasdaq: -73.30… | S&P: -25.11…
NASDAQ Adv/Dec 466/2155. …NYSE Adv/Dec 459/2374.

09:50AM ET

[BRIEFING.COM] As expected, the stock market began its day on a lower note as the Nasdaq Composite (-1.4%) trades behind the Dow Jones Industrial Average (-1.3%) and the S&P 500 (-1.3%).

Nine sectors trade in the red with financials (-2.0%) and industrials (-1.6%) leading the retreat. The remaining cyclical sectors sport losses between 1.4% (consumer discretionary) and 1.5% (materials). On the flipside countercyclical names outperform with telecom services (-0.5%) showing the slimmest loss while utilities (+0.2%) sports the only gain.

In the financial sector (-2.0%), asset management names demonstrate relative weakness with BlackRock (BLK 322.93, -9.58) and Bank of New York Mellon (BK 36.59, -1.40) losing 2.9% and 3.7%, respectively. Elsewhere, life insurance companies underperform with Prudential (PRU 68.14, -2.76) falling 3.8%.

The Dow Jones Transportation Average (-2.4%) trades behind the broader market as airline names weigh on the space. The U.S. Global Jets ETF (JETS 19.99, -0.67) has fallen 3.3%.

On the commodities front, WTI crude trades lower by 1.8% ($46.78/bbl; -$0.86) while gold trades higher by 0.6% ($1,330.70; +$8.30/ozt)

Dow: -224.28… | Nasdaq: -66.80… | S&P: -25.77…
NASDAQ Adv/Dec 445/2055. …NYSE Adv/Dec 480/2314.

09:19AM ET
[BRIEFING.COM] S&P futures vs fair value: -19.70. Nasdaq futures vs fair value: -39.50.

The stock market is on track for a lower start as the S&P 500 futures trade 20 points below fair value.

Global equity markets remain pressured this morning as participants continue to weigh the United Kingdom's decision to leave the European Union. European indices trade broadly lower as the focus shifts to the timing and terms of the country's formal exit from the single market. Volatility persists in the foreign exchange market as sterling slides an additional 3.5% against the dollar (1.3201), remaining near 30-year lows. Separately, safe havens continue to see a healthy bid as gold and Treasuries rally.

In company specific news, Marriott (MAR 63.19, -0.72) trades lower by 1.1% amid reports the EU approved its pending acquisition of Starwood Hotels (HOT 71.80, +0.00). Elsewhere on the M&A front, Skullcandy (SKUL 6.09, +0.33) has gained 5.7% in pre-market after confirming it received a competing unsolicited bid from Mill Road Capital. Mill Road has offered $6.05 per share, which compares to an offer from Incipio to acquire Skullcandy for $5.75 per share.

The U.S. Dollar Index (96.31, +0.87) has pulled back in recent action as commodity currencies and the euro make up some ground against the greenback. The dollar/Canadian dollar pair trades flat (1.3011) after slipping from the 1.3060 price level. Separately, the single currency trades lower by 0.9% against the dollar (1.1016) after ticking off the 1.0970 level earlier in the session.


08:58AM ET
[BRIEFING.COM] S&P futures vs fair value: -19.20. Nasdaq futures vs fair value: -41.70.

Global markets continue to trade broadly lower with the S&P 500 futures hovering 19 points below fair value. 

Equity indices in the Asia-Pacific region ended Monday on a mostly higher note with Japan's Nikkei (+2.4%) showing relative strength after falling nearly 8.0% on Friday. The advance in equities did not prevent more volatility in the foreign exchange market, where the British pound has dipped below Friday's low (1.3231) against the dollar.

  • In economic data:
    • Hong Kong's May Imports -4.3% month-over-month (previous -4.5%) and Exports -0.1% month-over-month (last -2.3%)
    • New Zealand's May trade deficit NZD3.63 billion (last deficit of NZD3.66 billion). May Exports hit NZD4.57 billion (previous NZD4.30 billion) and May Imports reached NZD4.22 billion (last NZD4.01 billion)

---Equity Markets---

  • Japan's Nikkei climbed 2.4% with consumer staples (+4.5%), utilities (+4.3%), and health care (+4.2%) pacing the advance. Nippon Paper, Nippon Telegraph & Telephone, Tokyo Electron, Central Japan Railway, and Meiji Holdings gained between 5.3% and 7.2%.
  • Hong Kong's Hang Seng shed 0.2%. Consumer names and financials ended among the laggards with Li & Fung, HSBC, Galaxy Entertainment, Sands China, and Bank of China Hong Kong posting losses between 0.9% and 3.7%.
  • China's Shanghai Composite climbed 1.5%. Nuode Investment, China National Software, Jiangsu Changjiang Electronics, and Beijing Aerospace gained between 8.7% and 10.0%.

Major European indices trade lower across the board as market participants continue to contemplate last week's referendum in Britain, which resulted in a call to pull out of the European Union. The British pound has faced continued selling pressure, falling 3.5% against the dollar to 1.3199, while the euro has also retreated, dropping 1.2% to 1.0984. On a separate note, a weekend election in Spain ended with Prime Minister Mariano Rajoy's People's Party winning the most seats (33.0%), but the party did not secure a majority. It is uncertain whether the party will be able to form a coalition with the second-place Socialist party.

  • Economic data was limited:
    • Eurozone May M3 Money Supply +4.9% year-over-year (consensus 4.8%; last 4.6%)

---Equity Markets---

  • Germany's DAX has given up 1.9%. Deutsche Bank has tumbled 8.8% while heavyweights Continental, Volkswagen, BMW, and Daimler are down between 1.9% and 11.8%. Vonovia outperforms, rising 3.3%.
  • UK's FTSE trades down 2.1% with financials and homebuilders leading the retreat. RBS, Barclays, Lloyds Banking, Prudential, and Aberdeen Asset Management are down between 8.0% and 20.1% while homebuilders Barratt Developments, Taylor Wimpey, and Persimmon show losses between 13.2% and 16.5%. On the upside, Randgold Resources has climbed 8.3%.
  • France's CAC is lower by 2.1%. Exporters and financials lag with Peugeot, Renault, Societe Generale, BNP Paribas, and Credit Agricole down between 5.7% and 8.6%. Countercyclical names like Sanofi and Danone outperform with respective gains of 1.3% and 0.5%.
  • Italy's MIB is down 2.4% with BMPS, Mediobanca, Intesa Sanpaolo, Unipol, and Unicredit showing losses between 7.5% and 11.3%.

08:33AM ET
[BRIEFING.COM] S&P futures vs fair value: -25.00. Nasdaq futures vs fair value: -52.10.

Equity futures continue to float near their session lows with the S&P 500 futures trading 25 points below fair value.

Just released, May International Trade in Goods showed a deficit of $60.59 billion, compared to the April deficit of $57.53 billion.

The U.S. Dollar Index (96.61, +1.16) floats at a session high as the greenback gains ground against commodity currencies, the euro, and the pound. The dollar/Canadian dollar pair trades higher by 0.3% (1.3040) while the single currency trades lower by 1.3% against the dollar, notching a new session low (1.0972). On the flipside, the dollar has lost 0.6% against the yen (101.61) amid speculation of possible foreign exchange intervention.


08:10AM ET
[BRIEFING.COM] S&P futures vs fair value: -26.00. Nasdaq futures vs fair value: -55.20.

U.S. equity futures trade at overnight lows with the S&P 500 futures floating 26 points below fair value. Futures slid lockstep with European bourses overnight as investors maintained their risk-off posture following Friday's referendum vote in the United Kingdom. At this juncture, the U.K.'s FTSE (-2.1%) and Italy's MIB (-2.4%) lead the retreat. Sovereign bond yields also remain pressured with the U.K.'s 10-yr gilt (0.95%) falling 14 basis points and notching a new all-time low (0.93%) earlier in the session. Additionally, the euro and pound continue to slide on the foreign exchange market with the two falling a respective 1.1% (1.0993) and 3.8% (1.3166) against the dollar.

The Treasury complex trades near overnight highs with the yield on the 10-yr note falling eight basis points to 1.47%.

On the economic front, data will be limited to the International Trade in Goods Report for May, which will be released at 8:30 ET.

In U.S. corporate news of note:

  • HeartWare (HTWR 57.41, +27.43): +91.5% after announcing that it would be acquired by Medtronic (MDT 82.00, -1.26) for $58 per share in cash or approximately $1.1 billion
  • GW Pharma (GWPH 96.59, +13.27): +15.9% following the company announcing positive Phase 3 trial results for its Epidiolex medication
  • Pandora Media (P 11.96, +0.22) after being upgraded to "Overweight" from "Equal-Weight" at Morgan Stanley
  • Barclays PLC (BCS 6.76, -2.13): -24.0% following the company being downgraded at Jefferies, BofA/Merrill, JP Morgan, and Exane BNP Paribas

Reviewing overnight developments: 

  • Asia-Pacific indices ended Monday on a mostly higher note with Japan's Nikkei +2.4%, China's Shanghai Composite +1.5%, and Hong Kong's Hang Seng -0.2%.
    • In economic data:
      • Hong Kong's May Imports -4.3% month-over-month (previous -4.5%) and Exports -0.1% month-over-month (last -2.3%)
      • New Zealand's May trade deficit NZD3.63 billion (last deficit of NZD3.66 billion). May Exports hit NZD4.57 billion (previous NZD4.30 billion) and May Imports reached NZD4.22 billion (last NZD4.01 billion)
  • In news:
    • Volatility on the foreign exchange market persisted with the British pound dipping below Friday's low (1.3231) against the dollar.
  • European indices trade lower with Germany's DAX -2.1%, the U.K.'s FTSE -2.1%, and France's CAC -1.9%. Elsewhere, Italy's MIB (-2.4%) underperforms. 
    • Economic data was limited:
      • Eurozone May M3 Money Supply +4.9% year-over-year (consensus 4.8%; last 4.6%)
    • In news: 
      • Equity markets remain pressured as participants continue to contemplate last week's referendum in Britain, which resulted in a call to pull out of the European Union.
      • The British pound has faced continued selling pressure, falling 3.8% against the dollar to 1.3166.
      • Meanwhile,  the euro has also retreated, dropping 1.1% to 1.0993.
      • In Spain, Prime Minister Mariano Rajoy's People's Party won the most seats (33.0%) in the weekend election, but the party did not secure a majority.
      • It is uncertain whether the party will be able to form a coalition with the second-place Socialist party.

06:13AM ET
[BRIEFING.COM] S&P futures vs fair value: -20.30. Nasdaq futures vs fair value: -42.80.

06:13AM ET
[BRIEFING.COM] Nikkei...15309...+357.20...+2.40%.  Hang Seng...20227...-31.80...-0.20%.

06:13AM ET
[BRIEFING.COM] FTSE...6068.83...-69.90...-1.10%.  DAX...9430.56...-126.60...-1.30%.

04:15PM ET

[BRIEFING.COM] The major averages ended a tumultuous session on a sharply lower note, selling off after the United Kingdom surprised markets by voting to leave the European Union. The move had widespread implications throughout capital markets as the S&P 500 (-3.4%) tumbled 75 points, losing the most points since September 1, 2015. Today's trade featured a flight from risk assets, a bid in safe havens, and the underperformance of the heavily-weighted financial (-5.4%), technology (-4.3%), industrial (-4.0%), and consumer discretionary (-3.6%) sectors. The Nasdaq Composite (-4.1%) ended its day behind the S&P 500 (-3.6%) and the Dow Jones Industrial Average (-3.4%).

Global equity markets tumbled overnight as participants reacted to a surprise result from yesterday's Brexit vote. The "Leave" camp carried the referendum after receiving 51.9% of last night's vote. In response, European indices paced the retreat as investors looked ahead to the multi-year legal process of withdrawing the UK from the EU. Additionally, foreign exchange markets were in focus as the pound sank to a three-decade low (1.3231) against the dollar. 

The major U.S. averages gapped lower at the beginning of the session as the heavyweight financial (-5.4%), technology (-4.3%), and industrial (-4.0%) sectors dragged on the broader market. To be fair though, all six cyclical sectors experienced heavy selling pressure as a flight from risk assets resulted in losses between 3.5% (energy) and 5.4% (financials). A downturn in crude oil added to the negative tenor as a rally in the buck weighed on the dollar-denominated commodity. For its part, WTI crude ended its pit session lower by 5.0% ($47.60/bbl; -$2.52). The S&P 500 (-3.6%) ended off its worst level of the day, but below prior technical support at the 2050 price level. 

The economically-sensitive financial sector (-5.4%) moved lower in sympathy with European banking names as Deutsche Bank (DB 14.72, -3.12) experienced its largest daily point loss since 2008. Elsewhere, Lloyds Banking (LYG 3.33, -1.01) and Royal Bank of Scotland (RBS 5.43, -2.06) lost 23.3% and 27.5%, respectively. On the home front, Dow component Goldman Sachs (GS 141.86, -10.80) ended its day at the bottom of the price-weighted index. The broader sector fell 5.4% today, extending its yearly loss to 7.4%.

The high-beta chipmakers demonstrated relative weakness, evidenced by the 5.8% decline in the PHLX Semiconductor Index. The growth-sensitive group experienced pressure as Skyworks (SWKS 61.61, -5.60) plunged 8.3%. In the broader technology sector (-4.3%), large cap component Microsoft (MSFT 49.86, -2.05) fell 4.0%.

In the consumer discretionary space (-3.6%), retail names ended ahead of the broader sector as the SPDR S&P Retail ETF (XRT 41.10, -0.90) declined 2.1%. On the flipside, PVH (PVH 93.55, 9.19) fell 8.9% after the company reported that net revenue generated from inside the United Kingdom constituted 3.0% of its total net revenues. Separately, travel names weighed as large cap component Priceline (PCLN 1232.14) fell 11.4%.

The U.S. Dollar Index (95.48, +1.95) ended broadly higher as the euro and the pound finished with substantial losses against the buck. The euro/dollar pair declined 2.4% (1.1111) while sterling plunged 8.1% against the dollar (1.3676).

The Treasury complex settled off its session high as the yield on the 10-yr note finished lower by 17 basis points at 1.57%.

Today's participation was above the recent average as more than 1.1 billion shares changed hands on the NYSE floor. The Russell 2000 (-3.7%) likely contributed to the increased volume ahead of this evening's annual rebalancing.

Today's economic data was limited to Durable Orders for May and the final reading of Michigan Consumer Sentiment for May:

  • The advance report on durable goods disappointed as new orders declined 2.2% month-over-month (Briefing.com consensus -0.6%) while orders excluding transportation declined 0.3% (Briefing.com consensus +0.1%).
    • The disappointment is deep-seated for several reasons.
    • First, orders declined in almost every category.
    • Secondly, business investment continued to flag, evidenced by a 0.7% decline in new orders for nondefense capital goods excluding aircraft, which followed a 0.4% decline in April.
    • Third, shipments of nondefense capital goods excluding aircraft, which factor into the GDP report, were down 0.5%, reversing most of a 0.6% increase in April.
    • On a year-over-year basis, new orders excluding transportation are down 0.5% while orders for nondefense capital goods excluding aircraft are down 3.5%.
    • The decline in May featured a 34.1% drop in orders for defense aircraft and parts. Overall, though, new orders for transportation equipment declined 5.6%, led by a 2.8% drop in orders for motor vehicles and parts.
    • Some other prominent order declines were seen in primary metals (-1.4% after a 0.7% decline in April), fabricated metal products (-0.3% after a 3.6% increase in April), machinery (-0.2% after a 2.0% decline in April), electrical equipment, appliances, and components (-0.1% after a 0.2% decline in April).
  • The final reading for the University of Michigan Consumer Sentiment Survey revealed a dip to 93.5 from the preliminary reading of 94.3. The Briefing.com consensus estimate was pegged at 94.0.
    • The final reading for June was below the final reading of 94.7 for May and below the 96.1 reading seen for June 2015.
    • It was said in the release that consumers were a bit less optimistic in late June due to rising concerns about prospects for the U.S. economy.
    • Those concerns showed up in the Index of Consumer Expectations, which slipped to 82.4 from 84.9 in May.
    • The Current Economic Conditions Index actually ticked up to 110.8 from 109.9. That is the highest reading for this index since January 2007.
    • Separately, consumers' inflation expectations for the next 12 months were left unchanged at 2.4%.

Monday's economic data will be limited to the International Trade in Goods Report for May, which will be released at 8:30 ET. 

  • Nasdaq Composite - 6.0% YTD
  • Russell 2000 -0.7% YTD
  • S&P 500 -0.3% YTD
  • Dow Jones -0.1% YTD 

Week in Review: Brexit Spoils Bull Party

The stock market gallivanted higher though the first four days of the week, but the upbeat attitude dissipated on Thursday evening after it became clear that the British referendum on membership in the European Union ended with a 51.9% victory for the 'Leave' camp. The resulting Friday selloff sent the S&P 500 lower by 3.6%. The index slid below its 50-day moving average (2080), surrendering 1.6% for the week.

Although the weekly decline in the S&P 500 did not look particularly concerning, the moves that unfolded in the foreign exchange market caught the attention of many.

The final set of polls released ahead of the referendum pointed to a growing edge for the 'Remain' camp, which lulled some market participants into a false sense of security. The pound notched a fresh six-month high against the dollar at 1.5018, but reversed in a flash after actual results began pouring in.

The first signs of an impending reversal in the foreign exchange market began appearing around 18:00 ET on Thursday when the pound started backing away from its high. This took place after it was reported that the 'Remain' camp secured just a slight victory in Newcastle, where status quo was expected to prevail by a large margin. Subsequent vote counts hinted at a much closer result than it was first expected, which invited risk-off positioning into capital markets.

At its lowest point, the pound was down nearly 11.0% against the dollar, but that decline was narrowed to 8.0% by the end of Friday. The volatility left the pound down more than 1,000 pips versus the dollar for the day, which is a move that would be expected to unfold over a few weeks under typical conditions.

U.S. Treasuries surged in reaction to the developments, pressuring the 10-yr yield to 1.40%--its lowest level since mid-2012.

The defensive finish to the week weighed on rate hike expectations, and the fed funds futures market now sees a higher chance of a rate cut in July (7.2%), September (7.2%), or November (7.0%) than that of a hike in November (1.9%). Looking farther out, the likelihood of a hike in February 2017 sits at a lowly 22.3%.

Dow: -611.21… | Nasdaq: -202.06… | S&P: -75.91…
NASDAQ Adv/Dec 471/3080. …NYSE Adv/Dec 479/2617.

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