Updated: 09-22-2014

The Market at 04:10PM ET
Dow: -107.06… | Nasdaq: -52.10… | S&P: -16.11…
NASDAQ Vol: 1.74 bln… Adv: 555… Dec: 2211…
NYSE Vol: 681.4 mln… Adv: 510… Dec: 2565…

Moving the Market

Officials in China and Japan push back against easing speculation

ECB President Mario Draghi says European recovery is losing momentum

Materials sector boosted after Merck KGaA (MKGAF) acquired Sigma-Aldrich (SIAL)

Sector Watch
Strong: Consumer Staples, Financials, Materials, Telecom Services
Weak: Consumer Discretionary, Energy, Health Care, Industrials, Technology

04:10PM ET
[BRIEFING.COM] The stock market began the new trading week on the defensive note with small-cap stocks pacing the retreat. The Russell 2000 (-1.4%) and Nasdaq Composite (-1.1%) displayed relative weakness, while the S&P 500 lost 0.8% with all ten sectors ending in the red.

Global equities began showing some cracks overnight after China's Finance Minister Lou Jiwei poured cold water on hopes for new stimulus measures. Specifically, Mr. Lou said the government has no plans to change policies despite the recent string of disappointing data. A somewhat similar hawkish tone was conveyed by comments from Japan's Economy Minister Akira Amari, who said his country's government remains on track to implement another consumption tax hike.

The macroeconomic concerns have led to weakness in equities, while also weighing on growth-sensitive commodities like copper (-1.6% to $3.04/lb) and crude oil (-0.9% to $90.80/bbl). Unlike last week, the losses were not driven by a stronger dollar as the Dollar Index ended flat after wiping out its overnight decline.

Meanwhile, the weakness in crude prices spilled over to the energy sector (-1.4%), which slumped out of the gate and spent the entire day among the laggards. The sector widened its September loss to 5.6% and is now down 7.2% during the third quarter.

Similar to energy, the consumer discretionary sector (-1.5%) lagged from the start with high-beta names like Amazon.com (AMZN 324.50, -6.82), Netflix (NFLX 442.78, -14.74), Priceline.com (PCLN 1165.79, -20.33) exerting notable pressure. The three lost between 1.7% and 3.2%. Homebuilders also weighed on the sector following today's disappointing Existing Home Sales report. The iShares Dow Jones US Home Construction ETF (ITB 23.24, -0.50) lost 2.1%.

Elsewhere among cyclical groups, the financial sector (-0.7%) displayed relative strength in the morning, but settled just ahead of the broader market. The technology sector (-0.8%) also finished near the broader market, while industrials (-1.1%) were pressured by transports. The Dow Jones Transportation Average fell 1.4%.

Also of note, the materials sector (-0.1%) spent the bulk of the session in the green, but was pressured into negative territory by the close. The relative strength stemmed from a 33.2% surge in Sigma-Aldrich (SIAL 136.40, +34.03) after the company agreed to be acquired by Merck KGaA (MKGAF 93.70, +4.20) for $140.00/share, which represents a 37.0% premium to Friday's closing price.

On the countercyclical side, consumer staples (-0.2%) and telecom services (-0.1%) displayed relative strength, while utilities (-0.7%) ended near the S&P 500. For its part, the health care sector (-0.6%) outperformed even as biotechnology struggled. The iShares Nasdaq Biotechnology ETF (IBB 272.55, -2.68) lost 1.0%.

Treasuries ended near their highs after spending the day in the green. The 10-yr yield slipped one basis point to 2.56%.

Participation was in line with recent averages as more than 680 million shares changed hands at the NYSE.

Economic data was limited to the Existing Home Sales for August, which fell 1.8% to 5.05 million SAAR from a slightly downwardly revised 5.14 million SAAR (from 5.15 million SAAR) in July, while the Briefing.com consensus expected an increase to 5.20 million. The report revealed the first monthly drop in sales since March and overall sales are still down 5.3% year-over-year.

Tomorrow, the July FHFA Housing Price Index will be released at 9:00 ET.
  • Nasdaq Composite +8.4% YTD 
  • S&P 500 +7.9% YTD 
  • Dow Jones Industrial Average +3.6% YTD 
  • Russell 2000 -2.8% YTD
Dow: -107.06… | Nasdaq: -52.10… | S&P: -16.11…
NASDAQ Adv/Dec 555/2211. …NYSE Adv/Dec 510/2565.

03:25PM ET
[BRIEFING.COM] The commodity complex was pressured by global macroeconomic concerns, while the Dollar Index was able to erase its overnight loss.

Dec gold spent the bulk of the overnight session in the red, but jumped from lows to highs in the $1220.00/ozt area after the release of today's disappointing Existing Home Sales report. The yellow metal then retreated from its high, ending with a slim gain of 0.1% at $1218.20/ozt.

Dec silver started with a sharp overnight loss that placed the metal at $17.50/ozt; however, a steady recovery off that low, put the metal at $17.77/ozt, representing a decline of 0.4%.

Nov crude oil traded little changed in the morning, but spent the bulk of the day in a slide from the early high. The energy component marked a low in the $90.43/bbl area before settling lower by 0.9% at $90.80/bbl.  

Oct natural gas spent some time on each side of its flat line, peaking at $3.88/MMBtu before sliding to a low near $3.81/MMBtu. A subsequent recovery placed natural gas at $3.85/MMBtu by the close for one-cent loss.
Dow: -107.81… | Nasdaq: -53.70… | S&P: -16.98…
NASDAQ Adv/Dec 556/2208. …NYSE Adv/Dec 484/2588.

03:00PM ET
[BRIEFING.COM] The S&P 500 trades lower by 0.8% with one hour remaining in the first session of the week. This morning was very quiet on the economic front with participants receiving just one report-August Existing Home Sales. Tomorrow's session will be equally as quiet with economic data limited to the FHFA Housing Price Index for July.

The remainder of the week will feature August Durable Orders (Briefing.com consensus -16.3%) and the third revision of Q2 GDP with the latter set to be released on Friday morning. The Briefing.com consensus expects the reading to be revised up to 4.6% from 4.2%.
Dow: -105.91… | Nasdaq: -56.77… | S&P: -16.64…
NASDAQ Adv/Dec 545/2228. …NYSE Adv/Dec 491/2589.

02:25PM ET
[BRIEFING.COM] Not much change in the major averages as they continue hovering near their lowest levels of the day. The S&P 500 (-0.8%) notched its session low around 12:00 ET and has maintained a seven-point range since then. Meanwhile, the price-weighted Dow Jones Industrial Average (-0.5%) continues trading a little ahead of the benchmark index.

Six Dow components remain in the green, but the leading performer, DuPont (DD 71.75, +0.50), is the only stock showing an increase larger than 0.4%. On the downside, six index members are lower by 1.0% or more with Nike (NKE 80.59, -1.22) sporting the largest decline. The apparel retailer has given up 1.5%.
Dow: -90.87… | Nasdaq: -61.25… | S&P: -16.74…
NASDAQ Adv/Dec 502/2263. …NYSE Adv/Dec 473/2590.

02:00PM ET
[BRIEFING.COM] Equity indices remain near their lows with the S&P 500 trading down 0.8%. The consumer discretionary sector (-1.5%) slumped to the bottom of the leaderboard at the start and the growth-sensitive sector remains behind the other nine groups at this juncture.

High-beta names like Amazon.com (AMZN 321.92, -9.40), Netflix (NFLX 439.80, -17.72), and Priceline.com (PCLN 1157.78, -28.34) have contributed to the underperformance with losses ranging from 2.4% to 2.9%. Meanwhile, retailers also lag with the SPDR S&P Retail ETF (XRT 87.24, -1.30) down 1.5%.

Elsewhere, Treasuries have returned into the middle of their trading range. The 10-yr yield is down one basis point at 2.57%.
Dow: -84.39… | Nasdaq: -60.41… | S&P: -16.07…
NASDAQ Adv/Dec 526/2237. …NYSE Adv/Dec 506/2525.

01:30PM ET
[BRIEFING.COM] The major indices continue to struggle under the weight of profit taking that has hit far and wide.

Not surprisingly, after a big run in the market, valuation concerns are being discussed in the foreground as concerns in the background about growth rates in China and the EU, as well as the US following the weaker than expected existing home sales report for August, have kept buyers at bay.

Continued weakness in the small-cap Russell 2000 (-1.5%) is also weighing on sentiment.  Most companies domiciled there have a domestic orientation, so the underperformance may be raising concerns that the US economy isn't faring as well as some pundits are suggesting and/or won't be insulated from a slowdown in China and the EU should conditions there continue to deteriorate.

Weakness in commodities, which can't be attributed to a big move in the greenback today, has contributed to the narrative today that growth concerns are pulling stock prices lower.  The CRB Index is down 0.8%.
Dow: -76.74… | Nasdaq: -58.74… | S&P: -14.91…
NASDAQ Adv/Dec 515/2237. …NYSE Adv/Dec 503/2521.

12:55PM ET
[BRIEFING.COM] Equity indices sit near their lows at midday with small caps leading the retreat. The Russell 2000 (-1.4%) and Nasdaq Composite (-1.2%) trail the S&P 500 (-0.7%), while the Dow Jones Industrial Average (-0.4%) has resisted some of the selling pressure.

The stock market has been pressured since the get go after overnight comments from China's Finance Minister Lou Jiwei poured cold water on hopes for new stimulus measures. Specifically, Mr. Lou said the government has no plans to change policies following the recent string of disappointing data.

A somewhat similar hawkish tone stemmed from comments made by Japan's Economy Minister Akira Amari, who said Japan's government remains on track to implement another consumption tax hike.

Overall, the concerns have translated into broad weakness for equities and growth-sensitive commodities like copper (-1.6% at $3.04/lb) and crude oil (-1.1% at $90.68/bbl). Furthermore, the Dollar Index holds a slim gain (+0.1%) after wiping out its overnight loss.

The noteworthy decline in crude oil has weighed on the energy sector (-1.2%), which is the second-weakest performer of the day. Meanwhile, the biggest laggard-consumer discretionary (-1.5%)-has been pressured by losses among high-beta names like Netflix (NFLX 440.56, -16.96) and Priceline.com (PCLN 1155.09, -31.03). Homebuilders haven't fared much better with the iShares Dow Jones US Home Construction ETF (ITB 23.30, -0.44) down 1.8%.

Elsewhere, the top-weighted sector-technology (-0.8%)-trails the broader market, while the materials space (+0.1%) has been able to stay in the green thanks a boost from Sigma-Aldrich (SIAL 136.53, +34.16), which has surged 33.4% after agreeing to be acquired by Merck KGaA (MKGAF 89.50, 0.00) for $140.00/share, representing a 37.0% premium to Friday's closing price.

The countercyclical side has fared a bit better with consumer staples (-0.1%), telecom services (-0.5%), and utilities (-0.5%) trading ahead of the broader market, while health care (-0.7%) lags amid weakness in biotechnology. The iShares Nasdaq Biotechnology ETF (IBB 271.14, -4.09) is lower by 1.5%.

Treasuries are near their highs with the 10-yr yield down two basis points at 2.56%.

Economic data was limited to the Existing Home Sales for August, which fell 1.8% to 5.05 million SAAR from a slightly downwardly revised 5.14 million SAAR (from 5.15 million SAAR) in July, while the Briefing.com consensus expected an increase to 5.20 million. The report revealed the first monthly drop in sales since March and overall sales are still down 5.3% year-over-year.
Dow: -71.42… | Nasdaq: -55.23… | S&P: -14.59…
NASDAQ Adv/Dec 507/2230. …NYSE Adv/Dec 482/2534.

12:30PM ET
[BRIEFING.COM] After spending the first two hours of the trading day in a steady slide, the S&P 500 has maintained a four-point range over the past 60 minutes.

The materials sector (+0.1%) has been able to stay out of the red, but its slim gain is now in jeopardy following an orderly decline from the opening high. Steelmakers have factored into the retreat as evidenced by a 2.9% decline in the Market Vectors Steel ETF (SLX 47.23, -1.40). Miners haven't done much to turn the tide with the Market Vectors Gold Miners ETF (GDX 22.23, -0.43) trading down 1.9%.

With stocks on their lows, participants have shown increased demand for volatility protection. The CBOE Volatility Index (VIX 13.89, +1.78) has approached the 14.00% mark.
Dow: -81.19… | Nasdaq: -59.24… | S&P: -16.79…
NASDAQ Adv/Dec 505/2231. …NYSE Adv/Dec 442/2546.

12:00PM ET
[BRIEFING.COM] Recent action saw the key indices inch to fresh lows for the session. Including today's decline of 0.8%, the S&P 500 is lower by 0.5% so far in September. Despite the loss for the month, the benchmark index has fared a bit better than its higher-beta peers. On that note, the Nasdaq has given up 1.3% so far this month, while the Russell 2000 is down 3.7% for the month. Elsewhere, the price-weighted Dow (-0.5%) trades ahead of the broader market today and is up 0.6% for the month.

Also of note, Treasuries slumped in the morning, but the broad-based weakness in equities has caused a rebound to a fresh high. The 10-yr note is higher by seven ticks with its yield down three basis points at 2.55%.
Dow: -79.26… | Nasdaq: -59.76… | S&P: -17.02…
NASDAQ Adv/Dec 463/2229. …NYSE Adv/Dec 428/2561.

11:25AM ET
[BRIEFING.COM] The major averages remain pressured with the S&P 500 trading lower by 0.7%. Two cyclical sectors-consumer discretionary (-1.4%) and energy (-1.2%)-began the session well behind the broader market and the pair remains at the bottom of the leaderboard at this time.

Meanwhile, other growth-sensitive groups are a bit mixed. Financials (-0.3%) and materials (+0.2%) outperform, while industrials (-0.8%) and technology (-0.8%) trade just behind the broader market.

The countercyclical side looks a bit better with consumer staples (-0.2%), telecom services (-0.1%), and utilities (-0.2%) trading ahead of the S&P 500, while health care (-0.6%) has been pressured by biotechnology. The iShares Nasdaq Biotechnology ETF (IBB 271.74, -3.50) is lower by 1.3%.
Dow: -53.77… | Nasdaq: -51.01… | S&P: -13.00…
NASDAQ Adv/Dec 489/2186. …NYSE Adv/Dec 466/2488.

10:55AM ET
[BRIEFING.COM] Equity indices have continued their retreat with small-cap stocks leading the slide. As a result, the Russell 2000 (-1.5%) trades near the Nasdaq Composite (-1.2%), while the S&P 500 (-0.7%) hovers a bit ahead of the other indices.

The relative weakness of small caps has carried over into high-beta areas like biotechnology and chipmakers. The iShares Nasdaq Biotechnology ETF (IBB 270.84, -4.39) is lower by 1.6%, while the PHLX Semiconductor Index trades down 1.1%.

Elsewhere, the Dow (-0.4%) has held up relatively well with 10 of its 30 components holding gains at this juncture. On the downside, Caterpillar (CAT 101.14, -1.37) is the weakest performer with a 1.3% decline.
Dow: -66.03… | Nasdaq: -54.70… | S&P: -14.91…
NASDAQ Adv/Dec 491/2127. …NYSE Adv/Dec 428/2498.

10:30AM ET
[BRIEFING.COM] Precious metals are trading lower this morning. Dec gold brushed a session low of $1212.50 in recent action and is now down 0.2% at $1214.60. Dec silver traded as low as $17.57 but has been inching higher in recent trade. It is currently at $17.71, or 0.8% lower.

Nov crude oil pulled back from its session high of $91.82 set at pit trade open and is slipping deeper into negative territory. It touched a LoD of $90.77 and is currently down 0.9% at $90.86.

Oct natural gas, on the other hand, is trading higher in a tight range between $3.85 and $3.88. It is now up 0.4% at $3.85.
Dow: -37.41… | Nasdaq: -39.22… | S&P: -10.08…
NASDAQ Adv/Dec 531/2031. …NYSE Adv/Dec 517/2363.

10:00AM ET
[BRIEFING.COM] The S&P 500 trades lower by 0.4%, while the Russell 2000 (-0.9%) underperforms.

Just reported, existing home sales hit an annualized rate of 5.05 million units in August, while the Briefing.com consensus expected a reading of 5.20 million. The pace for August was up from the prior month's revised rate of 5.14 million units (from 5.15 million).
Dow: -31.60… | Nasdaq: -26.88… | S&P: -7.73…
NASDAQ Adv/Dec 561/1935. …NYSE Adv/Dec 559/2272.

09:45AM ET
[BRIEFING.COM] Equity indices began the session on the defensive amid broad-based weakness. The S&P 500 trades lower by 0.4% with nine sectors holding opening losses. Most notably, heavily-weighted consumer discretionary (-0.7%) and energy (-0.7%) sectors have pressured the broader market, while the materials sector (+0.4%) outperforms amid relative strength in paper manufacturers.

Despite its relative strength, the materials sector only represents 3.5% of the entire market. Meanwhile, another cyclical sector, financials, also trades ahead of the broader market with a slim loss of 0.1%.

Treasuries have slid to lows over the past 30 minutes, sending the 10-yr yield back to unchanged for the day (2.57%).

The Existing Home Sales report for August will be released at 10:00 ET (Briefing.com consensus 5.20 million)
Dow: -33.90… | Nasdaq: -23.97… | S&P: -7.25…
NASDAQ Adv/Dec 507/1895. …NYSE Adv/Dec 556/2193.

09:16AM ET
[BRIEFING.COM] S&P futures vs fair value: -5.80. Nasdaq futures vs fair value: -12.00. The stock market is on track for a cautious start to the week as futures on the S&P 500 hover six points below fair value. Index futures dropped overnight, but have recovered nearly half of their original losses.

The initial weakness took place after China's Finance Minister Lou Jiwei played down expectations for additional easing measures from the government. A similar tone emanated from the European Central Bank with Governing Council member Ignazio Visco saying recent easing measures have worked as planned. Also of note, Japan's Economy Minsiter Akira Amari played up expectations of a consumption tax hike going forward.

The hawkish undertone to commentary from three major economies has translated into defensive action in futures. Conversely, Treasuries have been in demand with the 10-yr note sitting near its high with the benchmark yield at 2.56%.

On the corporate front, Yahoo! (YHOO 40.01, -0.91) is indicated to open lower by 2.2% on heavy volume after being downgraded at Bank of America/Merrill Lynch and Bernstein.

Elsewhere, Dresser-Rand (DRC 82.10, +2.19) has agreed to be acquired by Siemens (SIEGY 124.00, 0.00) for $83.00/share, representing a 37.4% premium to DRC price on July 16, 2014 when merger speculation first took place. Separately, Sigma-Aldrich (SIAL 137.78, +35.41) will be acquired by Merck KGaA (MKGAF 89.50, 0.00) for $140.00/share, which represents a 37.0% premium to Friday's closing price.

Treasuries are near their highs with the 10-yr yield down two basis points at 2.56%.

08:58AM ET
[BRIEFING.COM] S&P futures vs fair value: -6.10. Nasdaq futures vs fair value: -12.80. The S&P 500 futures trade six points below fair value.

Markets ended lower across most of Asia. Notably, Chinese Finance Minister Lou Jiwei suggested Beijing has no plans to adjust its current policy path despite the recent slowdown.
  • Economic data was limited: 
    • New Zealand's Westpac Consumer Sentiment dropped to 116.7 from 121.2 
    • Hong Kong's CPI slowed to 3.9% year-over-year (expected 4.0%; prior 4.0%) and the current account deficit widened to HKD8.94 billion from HKD4.43 billion, while the unemployment rate slipped to 3.9% from 4.0%. 
------
  • Japan's Nikkei lost 0.7%, sliding off seven-year highs. Heavyweight Softbank tumbled 6.1% as traders sold the news of the Alibaba IPO after shares saw a big run up into the event. 
  • Hong Kong's Hang Seng lost 1.4%, slumping to its lowest level in two months. Traders booked profits in shares of internet gaming giant Tencent Holdings, pushing the stock down 3.3%. 
  • China's Shanghai Composite fell 1.7% to a two-week low. Financials led to the downside with China Pacific Insurance shedding 3.8%. 
  • India's Sensex added 0.4%, finishing just shy of all-time highs. Automaker Tata Motors reversed its recent weakness, adding 3.9%. 
Major European indices trade in the red with Great Britain's FTSE (-0.7%) and Italy's MIB (-0.9%) trailing the region. After the close on Friday, Moody's affirmed France at Aa1 with a 'Negative' outlook. Separately, European Central Bank Governing Council member Ignazio Visco discussed policy, saying the recent easing steps have pressured the euro, suggesting additional easing will remain on hold for the time being.
  • Economic data included just one report: o Italy's Industrial New Orders fell 1.5% month-over-month (expected 1.1%; previous -2.1%), while the year-over-year reading fell 0.7% (prior -2.5%) 
------
  • Germany's DAX is lower by 0.2% with exporters on the defensive. BMW and Daimler hold respective losses of 2.6% and 1.4%. Merck KGaA outperforms with an increase of 6.5% after agreeing to acquire Sigma-Aldrich. 
  • France's CAC trades down 0.2% amid weakness in consumer names. Accor, Danone, Kering, and LVMH Moet Hennessy are down between 0.8% and 1.2%. Steelmaker Vinci leads with an increase of 1.0%. 
  • Great Britain's FTSE holds a loss of 0.7%. Miners lag with Anglo American, Antofagasta, Glencore, and Rio Tinto down between 2.1% and 3.1%. Also of note, Tesco has tumbled 8.5% in reaction to its profit warning. 
  • Italy's MIB has given up 0.9% amid weakness in financials. Banco Popolare, BMPS, and Banca Pop Emilia Romagna are down between 1.8% and 2.7%.

08:28AM ET
[BRIEFING.COM] S&P futures vs fair value: -5.50. Nasdaq futures vs fair value: -11.80. U.S. equity futures continue holding modest losses with the S&P 500 futures down six points below fair value.

The Dollar Index began the night in the red after gaining 0.6% last week, but a steady rally off the lows has placed the index back near its flat line for the session. The dollar is currently little changed versus the yen (109.05), while the euro (1.2844) and the pound (1.6330) continue holding slim gains against the greenback.

On the commodity side, both crude oil ($91.63/bbl) and gold futures ($1217.20/ozt) are little changed, while copper futures have tumbled 1.6% to $3.042/lb amid growth concerns in China.

08:00AM ET
[BRIEFING.COM] S&P futures vs fair value: -5.80. Nasdaq futures vs fair value: -12.80. U.S. equity futures trade modestly lower amid cautious action overseas. The S&P 500 futures hover six points below fair value after climbing off their overnight lows reached during the Asian session. The night has been very quiet on the economic front with several central bank and government officials playing down expectations of additional stimulus. On that note, China's Finance Minister Lou Jiwei said the government has not changed policies following the recent string of disappointing data, while Japan's Economy Minsiter Akira Amari played up expectations of a consumption tax hike going forward.

Treasuries hold slim gains with the 10-yr yield at 2.56%.

In U.S. corporate news of note:
  • AutoZone (AZO 525.00, -1.44): -0.3% despite beating bottom-line estimates on light revenue. 
  • Dresser-Rand (DRC 81.60, +1.69): +2.1% after agreeing to be acquired by Siemens (SIEGY 124.00, 0.00) for $83.00/share, representing a 37.4% premium to DRC price on July 16, 2014 when merger speculation first took place. 
  • Sigma-Aldrich (SIAL 137.45, +35.08): +34.3% after agreeing to be acquired by Merck KGaA (MKGAF 89.50, 0.00) for $140.00/share, representing a 37.0% premium to Friday's closing price.
Reviewing overnight developments:
  • Asian markets ended on a lower note. China's Shanghai Composite -1.7%, Hong Kong's Hang Seng -1.4%, and Japan's Nikkei -0.7% 
    • Economic data was limited: 
      • New Zealand's Westpac Consumer Sentiment dropped to 116.7 from 121.2 
      • Hong Kong's CPI slowed to 3.9% year-over-year (expected 4.0%; prior 4.0%) 
    • In news: 
      • China's Finance Minister Lou Jiwei said the country's government does not plan to change its economic policies despite disappointing data received in August 
      • Japan's Economy Minister Akira Amari hinted at an increased likelihood that a consumption tax hike will go into effect
  • Major European indices trade in mixed fashion. Germany's DAX +0.1%, Great Britain's FTSE -0.7%, and France's CAC is flat. Elsewhere, Italy's MIB -0.8% and Spain's IBEX -0.1%
    • In economic data: 
      • Italy's Industrial New Orders fell 1.5% month-over-month (expected 1.1%; previous -2.1%), while the year-over-year reading fell 0.7% (prior -2.5%) 
    • Among news of note: 
      • European Central Bank Governing Council member Ignazio Visco discussed policy, saying the recent easing steps have pressured the euro, suggesting additional easing will remain on hold for the time being 
      • After the close on Friday, Moody's affirmed France at Aa1 with a 'Negative' outlook

06:18AM ET
[BRIEFING.COM] S&P futures vs fair value: -8.00. Nasdaq futures vs fair value: -19.00.

06:18AM ET
[BRIEFING.COM] Nikkei...16,205.90...-115.30...-0.70%.  Hang Seng...23,955.49...-350.70...-1.70%.

06:18AM ET
[BRIEFING.COM] FTSE...9,776.10...-35.50...-0.50%.  DAX...9,776.10...-23.80...-0.20%.

04:10PM ET
[BRIEFING.COM] The stock market finished an upbeat week on a mixed note. The S&P 500 shed less than a point, ending the week higher by 1.3%, while the Dow Jones Industrial Average (+0.1%) cemented a 1.7% advance for the week. High-beta names underperformed, which weighed on the Nasdaq Composite (-0.3%) and the Russell 2000 (-1.3%).

Equity indices displayed strength in the early going with the S&P 500 tagging the 2,019 level during the opening 30 minutes of the action. However, that represented the high watermark for the benchmark index, which returned to its flat line by the close.

The early advance followed the failed independence referendum in Scotland, which averted a potential storm in the financial markets. Once the uncertainty was cast aside, participants directed their focus to the Alibaba Group (BABA 93.89, +25.89) IPO, which represented the largest public debut to date. Shares of Alibaba opened at $92.70 after pricing at $68/share, but could not settle above the opening print.

Alibaba followed a similar pattern as the broader market with the latter being weighed down by influential sectors like financials (-0.3%), technology (-0.4%), and industrials (-0.1%).

Despite today's underperformance, the financial sector finished the week among the leaders with a solid gain of 1.5% since last Friday. Meanwhile, technology lagged since the open following disappointing quarterly results from Oracle (ORCL 39.80, -1.75). The stock tumbled 4.2% in reaction to below-consensus earnings/revenue and news that CEO Larry Ellison will step down from his post.

Also of note, Oracle's peer, SAP (SAP 74.00, -3.35), lost 4.3% after announcing the acquisition of Concur Technologies (CNQR 126.82, +19.02) for $129 per share. High-beta chipmakers were unable to fill the void left by the two software giants as evidenced by a 1.2% decline in the PHLX Semiconductor Index. Despite today's slide, the index still finished the week with a strong gain of 1.5%.

For its part, the industrial sector lagged amid weakness in machinery stocks after Caterpillar (CAT 102.47, -1.87) provided a disappointing update regarding its sales over the past three months. The Dow component lost 1.8%, while peer Joy Global (JOY 58.02, -1.20) fell 2.0%.

Caterpillar was the weakest performer in the Dow and the only stock that fell more than 1.0%. On the upside, 22 index components posted gains with Coca-Cola (KO 42.05, +0.26) leading the pack. The stock climbed 0.6%, contributing to the relative strength of the consumer staples sector (+0.2%).

Similar to consumer staples, the remaining three countercyclical groups settled ahead of the broader market. Telecom services and utilities both jumped near 1.0%, while health care (+0.1%) ended among the leaders despite volatile action in the biotech space. The iShares Nasdaq Biotechnology ETF (IBB 275.23, +0.16) tacked on 0.1%.

Treasuries spent the session in a steady climb, pressuring the 10-yr yield to 2.58%. Participation was well ahead of average thanks to the Alibaba IPO and quadruple witching. More than 1.8 billion shares changed hands at the NYSE floor.

Economic data was limited to the Leading Indicators report for August, which showed an increase of 0.2% on top of an upwardly revised 1.1% (from 0.9%) reading for July. The Briefing.com consensus estimate called for an increase of 0.4%. The difference between what was expected and what was reported can be traced directly to the building permits contribution, which subtracted 0.18 percentage points in August. Consensus estimates could not be updated in a timely manner to reflect the impact of the weaker than expected building permits report, which was released yesterday.

On Monday, the Existing Home Sales report for August will be released at 10:00 ET.
  • Nasdaq Composite +9.7% YTD 
  • S&P 500 +8.8% YTD 
  • Dow Jones Industrial Average +4.2% YTD 
  • Russell 2000 -1.6% YTD 
Week in Review: Stocks Rally While FOMC Stays the Course

The stock market welcomed the new trading week with a mixed session that saw relative strength among large-cap stocks, while high-beta names underperformed. The Dow Jones Industrial Average (+0.3%) and S&P 500 (-0.1%) finished near their flat lines, while the Nasdaq Composite and Russell 2000 both lost 1.1%. Equities began the day on a cautious note amid continued concerns regarding the strength of the global economy. Over the weekend, China reported its first decline in electricity production since 2009, while Industrial Production (6.9%; expected 8.8%) grew at its slowest pace since December 2008. Likewise, the Industrial Production report from the U.S. (-0.1%; Briefing.com consensus 0.3%) also left a bit to be desired.

The major averages posted solid gains on Tuesday ahead of Wednesday's policy directive from the Federal Open Market Committee. The S&P 500 rallied 0.8%, while the Russell 2000 (+0.3%) could not keep pace with the benchmark index. Equity indices hovered near their flat lines during the first two hours of action, but surged in reaction to reports from the Wall Street Journal concerning next day's FOMC statement. Specifically, Fed watcher Jon Hilsenrath indicated that the statement would once again reflect the Fed's intentions to keep the fed funds rate at the zero bound for a considerable time after quantitative easing is wound down. The report sent the market higher since it contrasted with recent speculation that the Fed would drop the 'considerable time' language from its guidance, thus implying a swifter rate hike.

Stocks ended the midweek session with slim gains after showing some intraday volatility in reaction to the release of the latest policy directive from the Federal Open Market Committee. The S&P 500 added 0.1%, while the relative strength among small caps sent the Russell 2000 higher by 0.3%. The key indices spent the first half of the session near their flat lines as participants stuck to the sidelines ahead of the FOMC statement, which conveyed no changes to the Fed's current policy course. As expected, the Fed reduced the monthly pace of its asset purchases by $10 billion to $15 billion, setting expectations for the program to be wound down at the next meeting. Furthermore, the Fed maintained the "considerable time" language in its forward guidance, suggesting the first rate hike remains somewhat distant.

The market finished the Thursday session on a higher note with the S&P 500 climbing 0.5%. The benchmark index registered an early high within the first 90 minutes and inched to a new session best during the final hour of the action. Equities rallied out of the gate with the financial sector (+1.1%) providing noteworthy support for the second day in a row. The growth-oriented sector extended its September gain to 1.9% versus a more modest uptick of 0.4% for the S&P 500. Although financials did some heavy lifting, other influential sectors like health care (+0.8%) and technology (+0.7%) also served up a measure of support.
Dow: +13.75… | Nasdaq: -13.64… | S&P: -0.96…
NASDAQ Adv/Dec 1004/1907. …NYSE Adv/Dec 1194/1831.

Copyright © 2008 Briefing.com, Inc. All rights reserved.
Sponsor Center
Sponsored Links
Buy a Link Now
Content Partners