Updated: 08-18-2017

The Market at 04:30PM ET
Dow: -76.22… | Nasdaq: -5.39… | S&P: -4.46…
NASDAQ Vol: 1.97 bln… Adv: 1449… Dec: 1381…
NYSE Vol: 925.0 mln… Adv: 1513… Dec: 1360…

Moving the Market

President Trump has decided to remove White House Chief Strategist Steve Bannon

Caution as Wall Street comes off one of its worst one-day performances of the year

Top-weighted technology and financials sectors exhibits relative strength

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

04:30PM ET

[BRIEFING.COM] The major averages finished in negative territory for the second day in a row on Friday, adding to their losses for the week. The Dow led the retreat, losing 0.4%, while the S&P 500 and the Nasdaq finished lower by 0.2% and 0.1%, respectively. For the week, the Dow, the S&P 500, and the Nasdaq finished with respective losses of 0.8%, 0.7%, and 0.6%.

Equities opened modestly lower, but retraced those early-morning losses and moved into positive territory following an Axios report that suggested White House Chief Strategist Steve Bannon would be let go--and indeed he was with the official notice crossing the wires in the afternoon.

Mr. Bannon has been described as perhaps the most polarizing figure within President Trump's inner circle, so it could be argued that his departure will make it easier for Mr. Trump to find common ground with Congress. However, it could also be argued that the headline simply provided a good excuse for some buying following Thursday's big sell off. 

Regardless, the bears cut into the modest gains on Friday afternoon and eventually dragged the major averages into the red. Only three sectors--energy, utilities, and materials--finished in the green.

The utilities and energy spaces finished at the top of the day's leaderboard, adding 0.6% apiece. Crude oil underpinned the energy group, jumping 3.2% to $48.57/bbl. The commodity benefited from rumors that one of the largest oil refineries in the U.S. has been shut down. Despite Friday's advance, crude oil still finished 0.5% lower for the week. 

As for the remaining sectors, materials (+0.1%) eked out a small victory while financials (-0.1%), consumer discretionary (-0.5%), industrials (-0.3%), technology (-0.1%), health care (-0.4%), consumer staples (-0.4%), telecom services (-0.5%), and real estate (-0.7%) finished in the red. 

In corporate news, Foot Locker (FL 34.38, -13.32) plunged 27.9% to its lowest level in nearly four years after the shoe apparel retailer missed both top and bottom line estimates and reported far worse-than-expected same-store sales. Athletic merchandise suppliers like Nike (NKE 54.95, -2.51) and Under Armour (UAA 17.12, -0.69) also sold off, dropping 4.4% and 3.9%, respectively.

Deere (DE 117.31, -6.67) also finished solidly lower, losing 5.4%, after reporting better than expected earnings but worse than expected revenues. Conversely, Ross Stores (ROST 59.02, +5.69) jumped 10.7% after reporting better than expected earnings and revenues.

U.S. Treasuries finished Friday on a mixed note after backing off their morning highs; the 2-yr yield climbed one basis point to 1.31% while the 10-yr yield dropped one basis point to 2.19%.

Reviewing Friday's economic data, which was limited to the preliminary reading of the University of Michigan Consumer Sentiment Index for August:

  • The preliminary reading of the University of Michigan Consumer Sentiment Index for August rose to 97.6 (Briefing.com consensus 94.0) from 93.4 in July.
    • The August increase was fueled by a rebound in the Expectations Index, which returned to levels from the start of 2017.

Investors will not receive any economic data on Monday.

  • Nasdaq Composite +15.5% YTD
  • Dow Jones Industrial Average +9.7% YTD
  • S&P 500 +8.3% YTD
  • Russell 2000 +0.1% YTD

Week In Review: 

Wall Street had another disappointing week, its second in a row, as investors continued to drag the major U.S. indices from their all-time highs. The Dow, the S&P 500, and the Nasdaq finished with losses of 0.8%, 0.7%, and 0.6%, respectively, while the small-cap Russell 2000 underperformed (-1.2%), dropping to its flat line for the year.

Five sectors settled the week in the green--utilities (+1.3%), materials (+0.4%), real estate (+0.2%), consumer staples (+0.1%), and technology (unch)--while six groups finished in the red--energy (-2.7%), telecom services (-1.8%), consumer discretionary (-1.8%), industrials (-1.1%), health care (-0.8%), and financials (-0.5%).

The week's most notable headlines in chronological order:

  • Monday--S&P 500 +1.0%, Nasdaq +1.3%, Dow +0.6%
    • Investors breathed a sigh of relief after a quiet weekend in regards to North Korea
  • Tuesday--S&P 500 -0.1%, Nasdaq -0.1%, Dow unch
    • North Korea decided against executing last week's threat to launch missiles towards the U.S. territory of Guam
    • July Retail Sales came in hotter than expected (+0.6% actual vs +0.3% Briefing.com consensus)
  • Wednesday--S&P 500 +0.1%, Nasdaq +0.2%, Dow +0.1%
    • President Trump ended his Manufacturing Council and Strategy & Policy Forum following the departure of several CEOs
    • The FOMC minutes from the July meeting showed concerns about softer than expected inflation readings
  • Thursday--S&P 500 -1.5%, Nasdaq -1.9%, Dow -1.2%
    • Rumors that NEC Director Gary Cohn plans to resign circulated; the White House said the rumors are false
    • Terrorist attacks in Spain killed 14 and left more than 100 injured
  • Friday--S&P 500 -0.2%, Nasdaq -0.1%, Dow -0.4%
    • President Trump fired White House Chief Strategist Steve Bannon
    • The SPDR S&P Retail ETF (XRT) settled at its worst level since February 2016 following this week's batch of earnings

Thursday's session was perhaps the most notable of the week as the S&P 500 registered its second-worst performance of the year. The major indices opened Thursday's session with modest losses, but moved deeper into negative territory following a rumor that President Trump's chief economic advisor Gary Cohn plans to resign from his position following the president's controversial comments regarding last weekend's events in Charlottesville, VA. The White House later declared that the rumor was "100% false", but it did little to reverse the market's downward trend.

True or not, the rumor didn't do much to dispel the notion that working with the president could be a political liability, especially considering that it came on the heels of Mr. Trump's Wednesday decision to disband his Manufacturing Council and Strategy & Policy Forum in response to several CEOs leaving the two groups. The chief executives cited Mr. Trump's controversial Charlottesville comments as the reason for their departures. If Republicans in Congress start distancing themselves from Mr. Trump, it will be that much harder for him to push through his pro-growth agenda.

However, those concerns eased a bit on Friday after President Trump fired White House Chief Strategist Steve Bannon, a decision that was well received by the market. Mr. Bannon was the chief executive of Mr. Trump's presidential campaign and has been described as perhaps the most polarizing figure within President Trump's inner circle. Therefore, in the absence of Mr. Bannon, the thinking is that the president might dial back his rhetoric a bit, making it easier for the White House to work with Congress in passing the president's pro-growth agenda.

Following this week's events, the fed funds futures market now points to the March 2018 FOMC meeting as the most likely time for the next rate-hike announcement with an implied probability of 51.5%. Last week, the market expected the next rate hike to occur in June 2018 with an implied probability of 57.5%.

Dow: -76.22… | Nasdaq: -5.39… | S&P: -4.46…
NASDAQ Adv/Dec 1449/1381. …NYSE Adv/Dec 1513/1360.

02:55PM ET

[BRIEFING.COM] The major indices are hovering near their unchanged marks going into the final stretch. The Nasdaq (+0.2%) continues to exhibit relative strength.

Looking ahead, there are 16 S&P 500 constituents on next week's earnings calendar, including Lowe's (LOW 73.97, -0.14), HP (HPQ 43.77, +0.63), Medtronic (MDT 83.68, +0.01), Dollar Tree (DLTR 74.45, +0.11), Broadcom (AVGO 250.52, +3.49), Staples (SPLS 10.18, -0.01), and Salesforce.com (CRM 91.09, +0.21).

Next week's economic calendar is heavy on housing data with the June FHFA Housing Price Index due on Tuesday, July New Home Sales (Briefing.com consensus 615K) on Wednesday, and July Existing Home Sales (Briefing.com consensus 5.56 million) on Thursday. Durable Goods for July (Briefing.com consensus -6.0%) will be released next Friday.

Dow: -21.00… | Nasdaq: +10.29… | S&P: +1.53…
NASDAQ Adv/Dec 1549/1304. …NYSE Adv/Dec 1623/1231.

02:45PM ET

[BRIEFING.COM] Commodities end the day higher: 

  • Overall, commodities, as measured by the Bloomberg Commodity Index, are currently up 0.68% at 83.2447
  • Dollar index is down 0.2% at 93.44.
  • Sept WTI crude is higher on the day.
    • Crude futures surged ahead of Baker Hughes rig count data, which reported a decrease of 3 to 946.
    • This pop helped futures to regain almost all of the week's losses.
      • Futures settled $1.49 higher to $48.57/barrel.
  • In other energy, Sept natural gas settled down $0.04 at $1.63/MMBtu
  • Metals performed better well with precious metals and copper settling higher
    • Dec gold lost $0.80 to settle at $1291.50/oz, while September silver dropped $0.06 to $17.00/oz
    • September copper settled flat at $2.94/lb
  • Finally, agriculture:
    • September corn is higher $0.01 at $3.65/bu.
    • November soy is higher $0.04 at $9.38/bu.
    • September wheat is higher $0.02 at $4.44/bu.
Dow: -20.67… | Nasdaq: +11.84… | S&P: +1.77…
NASDAQ Adv/Dec 1555/1299. …NYSE Adv/Dec 1633/1222.

02:30PM ET

[BRIEFING.COM] The major U.S. indices are mixed this afternoon; the Nasdaq and the S&P 500 are up 0.2% and 0.1%, respectively, while the Dow is down 0.1%.

As the closing bell approaches, five sectors are on track to end the week in the green--utilities (+1.4%), materials (+0.5%), technology (+0.4%), consumer staples (+0.2%), and real estate (+0.2%)--while six groups are on track to finish in the red--energy (-2.4%), consumer discretionary (-1.6%), telecom services (-1.5%), industrials (-0.9%), health care (-0.6%), and financials (-0.2%).

In the bond market, U.S. Treasuries are lower this afternoon with the benchmark 10-yr yield hovering two basis points above its flat line at 2.20%. The 10-yr yield has advanced one basis point this week and currently trades just a tick above the seven-week low it posted on Thursday.

Dow: -9.87… | Nasdaq: +14.26… | S&P: +2.68…
NASDAQ Adv/Dec 1553/1295. …NYSE Adv/Dec 1684/1173.

02:00PM ET

[BRIEFING.COM] The major averages have ticked down from their session highs as of late, but the S&P 500 is still clinging to a small gain.

Transports have struggled today, sending the Dow Jones Transportation Average lower by 0.3%. Within the DJTA, Matson (MATX 22.53, -6.82) is by far the weakest component, plunging 23.4% to its lowest level since March 2013. Today's plunge follows news that TOTE Maritime plans to launch a shipping service that will compete with Matson. 

Unsurprisingly, the industrial sector (-0.1%), which houses many transport names, trade behind the broader market. Deere (DE 117.02, -6.96) is one of the sector's weakest components after reporting better than expected earnings and worse than expected revenues. DE shares are down 5.6%, hovering at a three-month low.

Dow: -23.76… | Nasdaq: +5.82… | S&P: +0.26…
NASDAQ Adv/Dec 1465/1354. …NYSE Adv/Dec 1590/1257.

01:25PM ET

[BRIEFING.COM] The major averages continue holding modest gains with the Nasdaq (+0.3%) benefiting from relative strength in the top-weighted technology sector (+0.4%).

Heavyweight tech components like Apple (AAPL 159.11, +1.25), Alphabet (GOOGL 929.92, +2.26), Intel (INTC 35.16, -0.01), and Cisco Systems (CSCO 30.64, -0.39) trade in mixed fashion while high-beta chipmakers-other than Intel-have picked up the slack. The PHLX Semiconductor Index is up 0.7%, looking to end the week with a 1.0% gain.

Other high-beta groups have failed to keep pace with the market today. The iShares Nasdaq Biotechnology ETF (IBB 304.82, +0.01) trades flat, iShares Dow Jones US Home Construction ETF (ITB 33.71, -0.22) has surrendered 0.6%, and the Dow Jones Transportation Average is down 0.2%.

Dow: +2.32… | Nasdaq: +19.47… | S&P: +3.79…
NASDAQ Adv/Dec 1562/1259. …NYSE Adv/Dec 1611/1200.

01:00PM ET

[BRIEFING.COM] The major averages are currently hovering at fresh session highs as investors cheer reports that President Trump has decided to remove White House Chief Strategist Steve Bannon. The Nasdaq (+0.4%) trades a step ahead of the benchmark S&P 500 (+0.3%) while the Dow (+0.1%) trades a step behind.

Equity indices opened Friday's session with modest losses, but began ticking up following an Axios report that many West Wing officials believe that President Trump's strategist Steve Bannon will be asked to step down. Mr. Bannon was the chief executive of Mr. Donald Trump's presidential campaign and has faced criticism as of late following comments he made about last weekend's events in Charlottesville, VA.

The market has rallied today on the belief that President Trump might dial back his rhetoric a bit in the absence of Mr. Bannon, making it easier for the White House to work with Congress in passing the president's pro-growth agenda. The New York Times just recently confirmed that President Trump has decided to fire Mr. Bannon, but noted that the president could still change his mind.

Seven sectors are currently trading in the green, with gains between 0.1% and 1.1%, while four sectors are trading in the red, with losses between 0.1% and 0.6%. The energy (+1.1%) and utilities (+1.0%) sectors are trading at the top of the leaderboard while the real estate sector (-0.6%) is trading at the bottom.

In corporate news, Foot Locker (FL 35.02, -12.68) has plunged 26.6% to its lowest level in nearly four years after the shoe apparel retailer missed both top and bottom line estimates and reported far worse-than-expected same-store sales. Athletic merchandise suppliers like Nike (NKE 54.89, -2.57) and Under Armour (UAA 17.14, -0.67) have also sold off, dropping 4.4% and 3.8%, respectively.

Deere (DE 117.56, -6.42) is also trading solidly lower, down 5.2%, after reporting better than expected earnings and worse than expected revenues. Conversely, Ross Stores (ROST 58.42, +5.09) is up 9.6% after reporting better than expected earnings and revenues.

In the bond market, U.S. Treasuries were trading in positive territory this morning, but slipped into the red as the equity market strengthened. The benchmark 10-yr yield is up two basis points at 2.21%. 

Reviewing Friday's economic data, which was limited to the preliminary reading of the University of Michigan Consumer Sentiment Index for August:

  • The preliminary reading of the University of Michigan Consumer Sentiment Index for August rose to 97.6 (Briefing.com consensus 94.0) from 93.4 in July.
    • The August increase was fueled by a rebound in the Expectations Index, which returned to levels from the start of 2017.
Dow: +25.24… | Nasdaq: +28.73… | S&P: +8.15…
NASDAQ Adv/Dec 1645/1167. …NYSE Adv/Dec 1707/1103.

12:25PM ET

[BRIEFING.COM] The major averages are trading mixed in early-afternoon action; the Nasdaq and the S&P 500 are up 0.2% and 0.1%, respectively, while the Dow is down 0.1%.

Crude oil has moved sharply higher over the last hour or so, exchanging a modest loss for a sizable gain. The commodity is currently up 2.5% at $48.26/bbl, which reduces its week-to-date loss to 1.2%. Likewise, the energy sector, which typically moves in tandem with the price of crude oil, has also moved sharply higher in recent action and now trades at the top of the day's leaderboard with a gain of 0.9%.

Despite today's positive performance, the energy sector is still trading at the bottom of this week's sector standings with a week-to-date loss of 2.2%.

Dow: -22.26… | Nasdaq: +13.47… | S&P: -1.70…
NASDAQ Adv/Dec 1467/1312. …NYSE Adv/Dec 1500/1284.

12:00PM ET

[BRIEFING.COM] Equity indices have ticked up to fresh session highs in recent action with the S&P 500 extending its gain to 0.2%.

The sector leaderboard is looking a lot more green than it was earlier this morning as six sectors are now trading in positive territory, including the financials (+0.3%), industrials (+0.1%), energy (+0.4%), materials (+0.2%), technology (+0.3%), and utilities (+0.5%) groups. Also of note, U.S. Treasuries have slipped back to their flat lines in recent action with the 10-yr yield now hovering at 2.19%.

According to an Axios report, many West Wing officials expect that White House Chief Strategist Steve Bannon will be asked to step down. Mr. Bannon was the chief executive of Mr. Donald Trump's presidential campaign and has faced criticism as of late following comments he made about last weekend's events in Charlottesville, VA.

Dow: -9.29… | Nasdaq: +23.86… | S&P: +4.47…
NASDAQ Adv/Dec 1549/1254. …NYSE Adv/Dec 1548/1246.

11:30AM ET

[BRIEFING.COM] The S&P 500 and the Nasdaq have moved into the green as of late and currently sport gains of 0.1% and 0.2%, respectively. The Dow still lags, however, trading lower by 0.2%.

Foot Locker (FL 34.85, -12.85) has plunged 26.9% to its lowest level in nearly four years after the shoe apparel retailer missed both top and bottom line estimates and reported far worse-than-expected same-store sales. Athletic merchandise suppliers like Nike (NKE 55.19, -2.28) and Under Armour (UAA 17.17, -0.64) have also faced heavy selling pressure today, dropping 3.9% and 3.6%, respectively.

The consumer discretionary sector (-0.2%), which houses the aforementioned names, trades a step behind the broader market, extending its week-to-date loss to 1.5%. For comparison, the S&P 500 currently holds a week-to-date loss of 0.4%.

Dow: -35.19… | Nasdaq: +12.74… | S&P: +0.45…
NASDAQ Adv/Dec 1385/1397. …NYSE Adv/Dec 1296/1463.

11:00AM ET

[BRIEFING.COM] The major averages are currently hovering in the upper half of their relatively narrow trading ranges with the S&P 500 showing a loss of 0.2%.

Ten of the eleven sectors are trading in the red with the utilities space (+0.3%) being the lone advancer. The telecom services (-0.8%) and real estate (-0.8%) groups show relative weakness while the remaining laggards hold losses of no more than 0.4%. The top-weighted technology sector (unch), which represents around 20.0% of the broader market, trades a step ahead of the benchmark index.

Within the tech group, chipmakers are outperforming, evidenced by the 0.4% increase in the PHLX Semiconductor Index. Meanwhile, the sector's top component by weight--Apple (AAPL 158.14, +0.29)--holds a modest gain, but Cisco Systems (CSCO 30.61, -0.43) struggles for the second day in a row following its earnings release on Wednesday evening. CSCO shares are currently down 1.4%.

Dow: -60.74… | Nasdaq: +0.46… | S&P: -3.88…
NASDAQ Adv/Dec 1081/1681. …NYSE Adv/Dec 1057/1670.

10:35AM ET

[BRIEFING.COM] Commodities begin the day flat: 

  • Overall, commodities, as measured by the Bloomberg Commodity Index, are currently flat at 82.7026.
  • Dollar index is down 0.17% at 93.47.
  • Sept WTI crude is down on the day.
    • The Baker Hughes rig count data will be reported today at 12pm ET.  
    • Futures are $0.16 lower to $46.92/barrel.
  • In other energy, Sept natural gas is down $0.03 at $2.899 /MMBtu
  • Precious metals are performing well: 
    • Dec gold gained $8.70 and trades at $1301.10/oz, while Sept silver gained $0.057 to $17.11/oz
    • Sept copper lost $0.005 to $2.933/lb
  • Finally, agriculture:
    • Dec corn is flat at $3.6425/bu.
    • Nov soy is down $0.0025 at $9.3275/bu.
    • Sept wheat is up $0.0025 at $4.1425/bu.
Dow: -57.49… | Nasdaq: -4.61… | S&P: -4.9…
NASDAQ Adv/Dec 1042/1686. …NYSE Adv/Dec 995/1722.

10:00AM ET

[BRIEFING.COM] The S&P 500 has extended its opening loss to 0.4%.

Just in, the preliminary reading of the University of Michigan Consumer Sentiment Index for August rose to 97.6 (Briefing.com consensus 94.0) from 93.4 in July.

Dow: -57.70 … | Nasdaq: -24.13… | S&P: -8.30…
NASDAQ Adv/Dec 769/1873. …NYSE Adv/Dec 795/1849.

09:45AM ET

[BRIEFING.COM] The major averages opened Friday's session a step below their flat lines with the S&P 500 showing a loss of 0.3%.

Most sectors are trading in the red this morning, but losses have been pretty modest thus far. The industrials (-0.5%), telecom services (-0.5%), and real estate (-0.6%) sectors show relative weakness while the top-weighted technology group (+0.1%) shows relative strength. Chipmakers are particularly bullish, pushing the PHLX Semiconductor Index higher by 0.6%.

In the bond market, U.S. Treasuries have ticked up from their flat lines in recent action; the benchmark 10-yr yield is currently down two basis points at 2.16%. Today's lone economic report--the preliminary reading of the University of Michigan Consumer Sentiment Index for August (Briefing.com consensus 94.0)--will be released shortly at 10:00 ET.

Dow: -43.57… | Nasdaq: -9.63… | S&P: -7.04…
NASDAQ Adv/Dec 739/1817. …NYSE Adv/Dec 692/1929.

09:13AM ET
[BRIEFING.COM] S&P futures vs fair value: -0.80. Nasdaq futures vs fair value: +13.10.

The major averages slipped into negative territory for the week on Thursday in what was the S&P 500's second-worst performance this year. However, the sell off has been put on hold for the time being. The S&P 500 futures currently trade one point below fair value. For the week, the S&P 500 holds a loss of 0.5%.

Earnings news has been plentiful this morning as retailers continue soaking up the spotlight. Many retailers have reported their quarterly results this week with Ross Stores (ROST 59.03, +5.70), Gap (GPS 23.68, +1.00), and Foot Locker (FL 37.99, -9.71) being the latest to do so.

Ross Stores and Gap have jumped 10.7% and 4.4%, respectively, in early action after both companies beat bottom-line estimates. In addition, ROSS reported above-consensus revenues while GPS raised its earnings guidance for the year. Conversely, Foot Locker has plunged 20.4% after missing both top and bottom line estimates. The company's comparable same-store sales fell well short of expectations.

Deere (DE 116.25, -7.91) also reported its quarterly results, which showed better than expected earnings, but worse than expected revenues. DE shares are lower by 6.4% in pre-market action.

U.S. Treasuries are trading flat this morning with the benchmark 10-yr yield unchanged at 2.18%. Meanwhile, the U.S. Dollar Index (93.40, -0.24) is down 0.3%, trimming its week-to-date gain to 0.5%.

Today's lone economic report--the preliminary reading of the University of Michigan Consumer Sentiment Index for August (Briefing.com consensus 94.0)--will be released at 10:00 ET.


08:50AM ET
[BRIEFING.COM] S&P futures vs fair value: +2.60. Nasdaq futures vs fair value: +20.90.

The S&P 500 futures trade three points, or 0.1%, above fair value.

Equity indices in the Asia-Pacific region ended the week on a lower note, taking a cue from Thursday's decline on Wall Street. Chinese Academy of International Trade and Economic Cooperation researcher Bai Ming was quoted in People's Daily as saying the U.S. probe into an alleged violation of intellectual property rights by China is short-sighted and would harm economic and trade relations. China's House Prices report showed a month-over-month increase in 56 out of 70 cities while prices in all 70 cities showed year-over-year increases.

  • Economic data was limited:
    • China's July House Prices +9.7% year-over-year (last 10.2%)

---Equity Markets---

  • Japan's Nikkei fell 1.2%, losing 1.3% for the week. Mitsubishi Electric, NKSJ Holdings, Kobe Steel, JTEKT, Showa Denko, Japan Steel Works, Yokohama Rubber, J Front Retailing, Fast Retailing, Nitto Denko, Sony, and Trend Micro posted losses between 2.3% and 3.7%.
  • Hong Kong's Hang Seng lost 1.1%, ending the week lower by 0.6%. Lenovo Group lost 3.6% while financials like ICBC, Bank of China, China Construction Bank, China Life Insurance, Hang Seng Bank, and HSBC surrendered between 1.1% and 2.1%.
  • China's Shanghai Composite settled flat, but gained 1.9% for the week. Luenmei Quantum, Xinjiang Yilite Industry, Shandong Hiking International, and Aluminum Corp of China lost between 3.8% and 4.4% while CSSC Science & Technology, Shenzhen Expressway, HuNan Tyen Machinery, and Hubei Kaile Science added between 5.8% and 7.5%.
  • India's Sensex lost 0.9%, widening this week's decline to 2.5%. Infosys sank 9.6% after CEO Vishal Sikka resigned. Sun Pharma, NTPC, Coal India, Dr. Reddy's Labs, and Cipla lost between 1.3% and 3.8%.

Major European indices trade lower across the board with Germany's DAX (-0.3%) staying ahead of its peers. Yesterday's terrorist attack at Las Ramblas in Barcelona claimed 14 lives and caused over 100 injuries. A second attack at Cambrils led to one death and six injuries. Spain's Prime Minister Mariano Rajoy pledged to reinforce security and provide support to families of victims.

  • In economic data:
    • Eurozone June Current Account surplus EUR21.20 billion (last EUR30.50 billion) Germany's July PPI +0.2% month-over-month (expected 0.1%; last 0.0%); +2.3% year-over-year (consensus 2.2%; last 2.4%)

---Equity Markets---

  • Germany's DAX is down 0.3% amid losses in most components. Thyssenkrupp, Infineon, Merck, Adidas, SAP, Volkswagen, Bayer, BMW, and BASF show losses between 0.4% and 1.2%. Deutsche Bank is lower by 0.2% while Commerzbank has added 0.4%.
  • UK's FTSE is lower by 1.0%, trading near last week's low. Hikma Pharmaceuticals has slumped 5.5% after lowering its outlook. Peer Shire is down 2.2% while consumer stocks like Paddy Power, Imperial Brands, Dixons Carphone, British American Tobacco, Associated British Foods, Carnival, and InterContinental Hotels are down between 1.2% and 2.9%.
  • France's CAC trades down 1.0% with all but two components on the defensive. Nokia Oyj is the weakest performer, falling 2.0%, while Valeo, Peugeot, and Renault are down between 1.2% and 1.8%. Financials like BNP Paribas and Societe Generale are both down near 0.9% while Credit Agricole is higher by 0.1%.

08:30AM ET
[BRIEFING.COM] S&P futures vs fair value: +4.00. Nasdaq futures vs fair value: +24.30.

The S&P 500 futures currently trade four points, or 0.2%, above fair value.

Many retailers have reported their quarterly earnings results this week with Ross Stores (ROST 59.15, +5.82), Gap (GPS 23.89, +1.21), and Foot Locker (FL 38.50, -9.20) being the latest to do so. Ross Stores and Gap have jumped 10.9% and 5.3%, respectively, in pre-market action after both companies beat bottom-line estimates. In addition, ROSS reported above-consensus revenues while GPS raised its earnings guidance for the year.

Conversely, Foot Locker has plunged 19.3% after missing both top and bottom line estimates. The company's comparable same-store sales fell well short of expectations.


07:57AM ET
[BRIEFING.COM] S&P futures vs fair value: +2.80. Nasdaq futures vs fair value: +19.10.

Wall Street was wounded on Thursday as the Dow registered its worst one-day drop since May 17, breaking a four-session winning streak. The bleeding has stopped for the time being, however, as the Dow futures point to a slightly higher open for the industrial average. Meanwhile, the S&P 500 futures currently trade three points, or 0.1%, above fair value.

Coming into today's session, the S&P 500 holds a week-to-date loss of 0.5%. Five sectors are trading in the green for the week--real estate (+0.9%), utilities (+0.6%), consumer staples (+0.4%), materials (+0.3%), and technology (+0.1%)--while six are trading in the red--health care (-0.4%), financials (-0.4%), industrials (-0.8%), telecom services (-1.3%), consumer discretionary (-1.3%), and energy (-3.2%).

The energy sector has been the weakest group this week by far, extending its year-to-date loss to 18.0%. Crude oil has weighed heavily on the sector, dropping 3.5% through the first four sessions of the week. However, the commodity is trading modestly higher this morning, up 0.3% at $47.21/bbl.

U.S. Treasuries are slightly lower in early action with the benchmark 10-yr yield climbing one basis point to 2.19%. Meanwhile, the U.S. Dollar Index (93.47, -0.17) is lower by 0.2%.

Today's lone economic report--the preliminary reading of the University of Michigan Consumer Sentiment Index for August (Briefing.com consensus 94.0)--will be released at 10:00 ET.

In U.S. corporate news:

  • Applied Materials (AMAT 45.45, +2.33): +5.4% after beating both top and bottom line estimates and raising its guidance.
  • Deere (DE 117.80, -6.18): -5.0% after reporting better than expected earnings and worse than expected revenues.
  • Ross Stores (ROST 59.00, +5.67): +10.6% after reporting better than expected earnings and revenues.
  • Gap (GPS 23.93, +1.25): +5.5% after beating bottom-line estimates and raising its guidance. 
  • Foot Locker (FL 38.98, -8.72): -18.3% after reporting worse than expected earnings and revenues. Comparable same-store sales came in well below guidance. 

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended the week on a lower note, taking a cue from Thursday's decline on Wall Street. Japan's Nikkei -1.2%, Hong Kong's Hang Seng -1.1%, China's Shanghai Composite unch, India's Sensex -0.9%.
    • In economic data:
      • China's July House Prices +9.7% year-over-year (last 10.2%)
    • In news:
      • Chinese Academy of International Trade and Economic Cooperation researcher Bai Ming was quoted in People's Daily as saying the U.S. probe into an alleged violation of intellectual property rights by China is short-sighted and would harm economic and trade relations.
      • China's House Prices report showed a month-over-month increase in 56 out of 70 cities while prices in all 70 cities showed year-over-year increases.
  • Major European indices trade lower across the board. Germany's DAX -0.4%, UK's FTSE -1.0%, France's CAC -1.1%.
    • In economic data:
      • Eurozone June Current Account surplus EUR21.20 billion (last EUR30.50 billion) Germany's July PPI +0.2% month-over-month (expected 0.1%; last 0.0%); +2.3% year-over-year (consensus 2.2%; last 2.4%)
    • In news:
      • Yesterday's terrorist attack at Las Ramblas in Barcelona claimed 14 lives and caused over 100 injuries. A second attack at Cambrils led to one death and six injuries. Spain's Prime Minister Mariano Rajoy pledged to reinforce security and provide support to families of victims.

05:51AM ET
[BRIEFING.COM] S&P futures vs fair value: flat. Nasdaq futures vs fair value: +5.40.

05:51AM ET
[BRIEFING.COM] Nikkei...19470...-232.20...-1.20%.  Hang Seng...27048...-296.70...-1.10%.

05:51AM ET
[BRIEFING.COM] FTSE...7318.78...-69.10...-0.90%.  DAX...12133.00...-70.50...-0.60%.

04:30PM ET

[BRIEFING.COM] Equities fell to heavy selling pressure on Thursday, dragging the major U.S. indices into negative territory for the week. The tech-heavy Nasdaq was hit the hardest, dropping 1.9%, as technology stocks underperformed. Meanwhile, the S&P 500 and the Dow settled with losses of 1.5% and 1.2%, respectively. For the week, the S&P 500 holds a loss of 0.5%.

The major indices opened Thursday's session with modest losses, but moved deeper into negative territory following a rumor that President Trump's chief economic advisor Gary Cohn plans to resign from his position as the Director of the National Economic Council. The White House later declared that the rumor was "100% false", but it did little to reverse the market's downward trend. 

Reports indicate that Mr. Cohn--who is seen as a key driver of Mr. Trump's economic agenda--is frustrated about comments from President Trump regarding last weekend's events in Charlottesville, VA. True or not, Thursday's rumor underlined the notion that President Trump's pro-growth agenda could be dead on arrival in Congress if lawmakers find it to be a political liability to work with the president.

However, it's also important to remember that many investors are looking for excuses to pull out of a market that just registered yet another record high a little more than a week ago on August 7. Following Thursday's slide, the Dow, the S&P 500, and the Nasdaq hover 1.7%, 2.1%, and 3.1%, respectively, below their record-high closing levels.

It's also worth pointing out that a van plowed into a crowd of people in Barcelona on Thursday, killing 13 and injuring more than 50. Local police deemed the incident a terrorist attack. While events similar to this one haven't prompted selling in the equity market so far this year, today's attack certainly didn't help the already bearish sentiment on Wall Street.

All 11 sectors finished Thursday's session in negative territory with the top-weighed technology sector (-2.0%) leading the retreat. Cisco Systems (CSCO 31.04, -1.30) was one of the tech sector's weakest components, dropping 4.0%, despite hitting both top and bottom line estimates. Chipmakers also showed notable weakness, pushing the PHLX Semiconductor Index lower by 2.6%.

The industrial sector also finished behind the broader market, losing 1.7%, as transports weighed, evidenced by the 2.4% decrease in the Dow Jones Transportation Average. Airlines led the transport retreat, pushing the US Global Jets ETF (JETS 29.02, -1.00) lower by 3.3%.

On the flip side, four sectors--health care (-1.3%), consumer staples (-0.9%), utilities (-0.8%), and real estate (-0.7%)--finished ahead of the broader market. Within the consumer staples group, Wal-Mart (WMT 79.70, -1.28) showed relative weakness, dropping 1.6%, despite reporting better than expected earnings.

In the bond market, Treasuries held losses in early-morning action, but began climbing as the equity market weakened. The benchmark 10-yr yield traded as high as 2.25%, but ended the day three basis points below its flat line at 2.20%.

Reviewing Thursday's economic data, which included the weekly Initial Claims Report, the August Philadelphia Fed Index, the July Industrial Production & Capacity Utilization Report, and the Conference Board's Leading Economic Index for July:

  • The latest weekly initial jobless claims count totaled 232,000 while the Briefing.com consensus expected a reading of 240,000. Today's tally was below the unrevised prior week count of 244,000. As for continuing claims, they declined to 1.953 million from the revised count of 1.956 million (from 1.951 million).
    • There are no new takeaways from those data series, which continue reflecting a tight labor market.
  • The Philadelphia Fed Survey for August declined to 18.9 from an unrevised 19.5 in July while economists polled by Briefing.com had expected a reading of 17.0.
    • The key takeaway from the report is that it showed a rebound in new orders after July figures hinted at a weak start to the third quarter.
  • Industrial Production increased 0.2% in July (Briefing.com consensus 0.3%) while Capacity Utilization was unchanged at 76.7% (Briefing.com consensus 76.7%) from a revised reading of 76.7% in June (from 76.6%).
    • The key takeaway from the report is that factory output in July remained at levels seen in February. The lack of significant change in capacity utilization suggests that the resource slack will persist, tempering inflation expectations.
  • The Conference Board's Leading Indicators report for July increased 0.3% (Briefing.com consensus 0.3%) after moving higher by an unrevised 0.6% in June.

On Friday, investors will receive just one economic report--the preliminary reading of the University of Michigan Consumer Sentiment Index for August (Briefing.com consensus 94.0). The report will cross the wires at 10:00 ET.

  • Nasdaq Composite +15.6% YTD
  • Dow Jones Industrial Average +10.1% YTD
  • S&P 500 +8.5% YTD
  • Russell 2000 +0.1% YTD
Dow: -274.14… | Nasdaq: -123.19… | S&P: -38.10…
NASDAQ Adv/Dec 682/2089. …NYSE Adv/Dec 518/2430.

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