Updated: 09-22-2017

The Market at 09:15AM ET

Moving the Market

Stocks struggle to extend record highs

Sector Watch
Strong:
Weak:

09:15AM ET
[BRIEFING.COM] S&P futures vs fair value: -3.50. Nasdaq futures vs fair value: -19.10.

Stocks settled Thursday's session a step below their flat lines, bringing the S&P 500 back to its flat line for the week. It appears that the modest selling will continue at the start of today's session as the S&P 500 futures currently trade four points, or 0.1%, below fair value.

In corporate news, Sprint (S 8.34, +0.31) and T-Mobile US (TMUS 64.25, +0.86) are up 3.9% and 1.4%, respectively, in pre-market action following a Reuters report that the two wireless names are close to a merger deal. Conversely, GrubHub (GRUB 51.09, -2.42) has dropped 4.5% following news that Wal-Mart (WMT 80.01, 0.00) is testing a new food delivery service and that Amazon (AMZN 962.50, -2.15) plans to partner with private company Olo for online food ordering.

On the earnings front, Finish Line (FINL 8.40, -0.82) has plunged 8.9% after missing revenue estimates while CarMax (KMX 71.60, +2.76) has added 4.0% after reporting better-than-expected earnings and revenues.

Crude oil is trading flat at $50.55/bbl as investors await news from Vienna, where major oil producers are meeting to discuss the possibility of extending and/or deepening the current OPEC/non-OPEC supply cut agreement, which is set to expire in March 2018. However, many analysts believe that an extension announcement would be a bit premature at this point in time.

Meanwhile, U.S. Treasuries are mixed with shorter-dated issues moving lower while longer-dated issues move higher. The 2-yr yield is up one basis point at 1.44% while the benchmark 10-yr yield is down three basis points at 2.28%. For the week, the 2-yr and 10-yr yields are up six basis points and five basis points, respectively.

Also of note, North Korea has threatened to test a hydrogen bomb in the Pacific Ocean and released a statement in which its Supreme Leader Kim Jong-un criticized President Trump's Tuesday speech at the United Nations.

Investors will not receive any economic data on Friday. 


08:50AM ET
[BRIEFING.COM] S&P futures vs fair value: -2.80. Nasdaq futures vs fair value: -17.90.

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

Equity indices in the Asia-Pacific region ended the week on a mostly lower note. North Korea's KCNA released a statement attributed to Supreme Leader Kim Jong-un, in which the country's leader responded to President Trump's speech at the UN, saying 'the highest level of countermeasure' will be considered. The statement went on, calling President Trump a 'dotard.' Reports from South Korea indicate that North Korea's Foreign Minister said his country is considering a nuclear test over the Pacific. Japan's Prime Minister Shinzo Abe will reportedly speak to the press on Monday. This comes amid speculation that Prime Minister Abe is preparing to call a snap election. Standard & Poor's downgraded Hong Kong's rating to AA+ from AAA and revised its outlook to Stable from Negative.

  • In economic data:
    • Japan's Foreign Bonds Buying JPY381.80 billion (last JPY198.70 billion) and Foreign Investment in Japanese Stocks -JPY918.60 billion (last -JPY644.60 billion)

---Equity Markets---

  • Japan's Nikkei shed 0.3%, narrowing this week's gain to 1.9%. JFE Holdings, Shiseido, Alps Electric, J Front Retailing, Nitto Denko, Dentsu, and Suzuki Motor lost between 1.8% and 4.7%. On the flip side, Credit Saison, Meiji Holdings, East Japan Railway, Sumitomo Mitsui, and Konami rose between 1.4% and 1.9%.
  • Hong Kong's Hang Seng lost 0.8%, but added 0.3% for the week. Property names and financials underperformed with China Resources Land, China Overseas, Ping An Insurance, Hang Lung Properties, SHK Properties, BoC Hong Kong, and Cheung Kong Property Holdings posted losses between 1.3% and 3.9%.
  • China's Shanghai Composite shed 0.2%, ending the week little changed. Shanghai Chinafortune, Cangzhou Dahua, Fangda Carbon New Material, Hangzhou Silan Microelectronics, and Shanghai Lingang Holdings surrendered between 4.3% and 5.8%.
  • India's Sensex settled lower by 1.4%, trimming this week's advance to 0.7%. Tata Steel, Larsen & Toubro, Reliance Industries, ICICI Bank, Hero MotoCorp, Bajaj Auto, Cipla, Infosys, and Dr. Reddy's Labs lost between 1.2% and 4.7%. Only two components finished in the green as Wipro rose 1.0% and Coal India added 0.1%.

Major European indices trade on a mostly higher note. British Prime Minister Theresa May will speak at Santa Maria Novella Church in Florence around 14:00 local time. In her speech, Ms. May is expected to call on the EU to make the Brexit process as smooth as possible. In Spain, the country's federal government has called police and civil guard reinforcements to Catalonia. Reports from yesterday indicate the Spanish government hired ferries to house police and security officers in the Port of Barcelona. The independence referendum is scheduled for October 1 and Spanish markets remain unconcerned with the developments.

  • In economic data:
    • Eurozone September flash Manufacturing PMI 58.2 (expected 57.1; last 57.4) and flash Services PMI 55.6 (expected 54.7; last 54.7)
    • Germany's September flash Manufacturing PMI 60.6 (expected 59.0; previous 59.3) and flash Services PMI 55.6 (consensus 53.8; last 53.5)
    • UK's September CBI Industrial Trends Orders 7 (expected 13; last 13)
    • France's September flash Manufacturing PMI 56.0 (expected 55.5; last 55.8) and flash Services PMI 57.1 (consensus 54.8; last 54.9). Q2 GDP +0.5% quarter-over-quarter, as expected
    • Spain's trade deficit widened to EUR2.10 billion from EUR1.30 billion (expected deficit of EUR1.00 billion)

---Equity Markets---

  • UK's FTSE is up 0.1% with select consumer names and financials showing relative strength. Standard Life, British American Tobacco, Dixons Carphone, RSA Insurance, InterContinental Hotels, ITV, Next, Old Mutual, and Taylor Wimpey have gained between 0.3% and 1.9%.
  • Germany's DAX is flat. Infineon, Lufthansa, Commerzbank, SAP, BASF, and Merck are up between 0.1% and 1.0%. On the downside, Deutsche Bank is down 0.4% and Siemens has shed 0.8%.
  • France's CAC trades up 0.3%. L'Oreal has spiked 3.4% after the death of majority owner Liliane Bettencourt prompted speculation about Nestle increasing its stake in the company or buying it outright. Pernod Ricard, STMicroelectronics, Sanofi, and Kering are up around 0.8% apiece.
  • Italy's MIB has climbed 0.2%. Fiat is up 3.8% while Banca Pop Emilia Romagna, Intesa Sanpaolo, Banca Generali, and UBI Banca show gains between 0.3% and 1.4%.

08:31AM ET
[BRIEFING.COM] S&P futures vs fair value: -2.30. Nasdaq futures vs fair value: -15.40.

The S&P 500 futures trade two points below fair value.

Coming into Friday's session, five sectors hold week-to-date gains--financials (+2.7%), telecom services (+2.4%), industrials (+1.7%), energy (+1.4%), and materials (+1.3%)--while six sectors hold week-to-date losses--consumer discretionary (-0.4%), technology (-0.7%), health care (-1.2%), real estate (-2.0%), utilities (-2.1%), and consumer staples (-2.1%).

News that Sprint (S 8.30, +0.27) and T-Mobile US (TMUS 64.35, +0.96) are nearing a merger deal may give the telecom services group the boost it needs to surpass the financial space at the top of the sector standings. The two companies show pre-market gains of 3.3% and 1.5%, respectively.


08:02AM ET
[BRIEFING.COM] S&P futures vs fair value: -0.60. Nasdaq futures vs fair value: -12.70.

Stocks slipped on Thursday, leaving the major U.S. indices a step below their record highs. As a whole, investor sentiment has been neutral this week, evidenced by the S&P 500, which enters Friday's session flat for the week. It appears that it will be more of the same at the opening bell as the S&P 500 futures trade just one point below fair value.

Crude oil is modestly lower this morning, down 0.4% at $50.37/bbl, as investors await news from Vienna, where major oil producers are meeting to discuss the possibility of extending and/or deepening the current OPEC/non-OPEC supply cut agreement, which is set to expire in March 2018. However, many analysts believe that an extension announcement would be a bit premature at this point in time.

In the bond market, Treasuries have climbed higher this morning, reclaiming a small portion of this week's losses. The benchmark 10-yr yield is down two basis points at 2.26%, but still remains higher by six basis points for the week. Meanwhile, the 2-yr yield is flat at 1.43%.

Also of note, the U.S. Dollar Index has dropped 0.3% to 91.73, gold is up 0.4% at $1,300.01/ozt, and the CBOE Volatility Index (VIX 9.89, +0.22) has climbed 2.3%.

Investors will not receive any economic data on Friday.

In U.S. corporate news:

  • Hewlett Packard Enterprise (HPE 14.13, +0.34): +2.5% following a Bloomberg report that the company is planning to cut about 10% of its staff.
  • Sprint (S 8.35, +0.32): +4.0% following a Reuters report that the company is nearing a merger deal with T-Mobile US (TMUS 64.25, +0.86).
  • CarMax (KMX 69.90, +1.06): +1.5% after beating both top and bottom line estimates.
  • Finish Line (FINL 8.55, -0.67): -7.3% after missing revenue estimates.
  • Equifax (EFX 101.50, +3.25): +3.3% after EFX shares were upgraded to 'Outperform' from 'Market Perform' at Wells Fargo.

Reviewing overnight developments:

  • Equity indices in the Asia-Pacific region ended the week on a mostly lower note. Japan's Nikkei -0.3%, Hong Kong's Hang Seng -0.8%, China's Shanghai Composite -0.2%, India's Sensex -1.4%.
    • In economic data:
      • Japan's Foreign Bonds Buying JPY381.80 billion (last JPY198.70 billion) and Foreign Investment in Japanese Stocks -JPY918.60 billion (last -JPY644.60 billion)
    • In news:
      • North Korea's KCNA released a statement attributed to Supreme Leader Kim Jong-un, in which the country's leader responded to President Trump's speech at the UN, saying 'the highest level of countermeasure' will be considered. The statement went on, calling President Trump a 'dotard.'
      • Reports from South Korea indicate that North Korea's Foreign Minister said his country is considering a nuclear test over the Pacific.
      • Japan's Prime Minister Shinzo Abe will reportedly speak to the press on Monday. This comes amid speculation that Prime Minister Abe is preparing to call a snap election.
      • Standard & Poor's downgraded Hong Kong's rating to AA+ from AAA and revised its outlook to Stable from Negative.
  • Major European indices trade on a higher note. UK's FTSE +0.2%, Germany's DAX +0.3%, France's CAC +0.4%, Italy's MIB +0.6%.
    • In economic data:
      • Eurozone September flash Manufacturing PMI 58.2 (expected 57.1; last 57.4) and flash Services PMI 55.6 (expected 54.7; last 54.7)
      • Germany's September flash Manufacturing PMI 60.6 (expected 59.0; previous 59.3) and flash Services PMI 55.6 (consensus 53.8; last 53.5)
      • UK's September CBI Industrial Trends Orders 7 (expected 13; last 13)
      • France's September flash Manufacturing PMI 56.0 (expected 55.5; last 55.8) and flash Services PMI 57.1 (consensus 54.8; last 54.9). Q2 GDP +0.5% quarter-over-quarter, as expected
      • Spain's trade deficit widened to EUR2.10 billion from EUR1.30 billion (expected deficit of EUR1.00 billion)
    • In news:
      • British Prime Minister Theresa May will speak at Santa Maria Novella Church in Florence around 14:00 local time. In her speech, Ms. May is expected to call on the EU to make the Brexit process as smooth as possible.
      • In Spain, the country's federal government has called police and civil guard reinforcements to Catalonia. Reports from yesterday indicate the Spanish government hired ferries to house police and security officers in the Port of Barcelona. The independence referendum is scheduled for October 1 and Spanish markets remain unconcerned with the developments.

06:05AM ET
[BRIEFING.COM] S&P futures vs fair value: flat. Nasdaq futures vs fair value: -7.10.

06:05AM ET
[BRIEFING.COM] Nikkei...20296.45...-51.00...-0.30%.  Hang Seng...27880.5...-229.80...-0.80%.

06:05AM ET
[BRIEFING.COM] FTSE...7265.64...+1.70...+0.00%.  DAX...12619.56...+19.50...+0.20%.

04:30PM ET

[BRIEFING.COM] Thursday was a quiet day on Wall Street as investors engaged in some end-of-quarter profit taking. The Dow slipped 0.2%, failing to close at a new record high for the first time in seven sessions, while the S&P 500 and the Nasdaq dropped 0.3% and 0.5%, respectively. Investor participation was below average due to the start of the Rosh Hashanah holiday.

Nine of the eleven sectors settled Thursday's session in negative territory, but losses were modest for the most part. The consumer staples sector was the weakest group (-1.0%), extending its week-to-date loss to 2.1%. The telecom services sector also finished with a sizable decline (-0.8%), but the remaining laggards lost no more than 0.6%.

The top-weighted technology space held a loss of 1.0% shortly after the opening bell, but strengthened a bit as the day wore on; the tech group eventually settled lower by 0.6%. Apple (AAPL 153.39, -2.68) was among the weakest components within the sector (-1.7%), extending its week-to-date loss to 4.1%.

NVIDIA (NVDA 180.76, -5.08) also struggled, dropping 2.7%, following a CNBC report that Tesla (TSLA 366.48, -7.43), which uses NVIDIA hardware for its auto-pilot functionality, is working with AMD (AMD 13.41, -0.33) to develop a self-driving chip. AMD later denied the report.

On the flip side, the financials (+0.2%) and industrials (+0.3%) groups managed to escape Thursday's session with modest victories. General Electric (GE 24.75, +0.43) played a big part in the industrial sector's positive performance, climbing 1.8%. GE shares have added 4.3% since September 11, but still remain lower by 21.7% for the year.

As for the heavily-weighted financial space, today's win marked its ninth in the last ten sessions--a run that's boosted the sector 6.9% since September 7.

In the bond market, U.S. Treasuries moved higher at the start of Thursday's session, but gave back most of their gains by the close. The yield on the benchmark 10-yr Treasury note finished unchanged at 2.28%, while the 2-yr yield slipped one basis point to 1.43%.

Meanwhile, gold tumbled 1.2% to $1,294.70/ozt, the U.S. Dollar Index slipped 0.2% to 92.03, and WTI crude dropped 0.3% to $50.55/bbl.

On the political front, President Trump signed an executive order aimed at targeting individuals and companies involved in business with North Korea and said that China has ordered its banks to stop working with Pyongyang.

Reviewing Thursday's economic data, which included the weekly Initial Claims Report, the September Philadelphia Fed Index, and the July FHFA Housing Price Index:

  • The latest weekly initial jobless claims count totaled 259,000 while the Briefing.com consensus expected a reading of 310,000. Today's tally was below the revised prior week count of 282,000 (from 284,000). As for continuing claims, they rose to 1.980 million from the revised count of 1.936 million (from 1.944 million).
    • The key takeaway, then, is that employers appear to be reluctant to cut their payrolls in a tight labor market.
  • The Philadelphia Fed Survey for September rose to 23.8 from an unrevised 18.9 in August while economists polled by Briefing.com had expected a reading of 17.1.
    • The key takeaway from the report is that most firms expect increased production for the rest of the year.
  • The FHFA Housing Price Index for July rose 0.2%. The prior month's reading was left unrevised at +0.1%.

Investors will not receive any economic data on Friday.

  • Nasdaq Composite +19.3% YTD
  • S&P 500 +11.7% YTD
  • Dow Jones Industrial Average +13.1% YTD
  • Russell 2000 +6.4% YTD
Dow: -53.36… | Nasdaq: -33.35… | S&P: -7.64…
NASDAQ Adv/Dec 1245/1357. …NYSE Adv/Dec 1250/1633.

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