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End of Day Brief - Tuesday June 29 - Markets go sideways

Dow34292.29+9.02(0.03%)
Nasdaq14528.34+27.83(0.19%)
SP 5004291.80+1.19(0.03%)
10-yr Note 0/321.475
NYSEAdv 1474 Dec 1745 Vol 804.2 mln
NasdaqAdv 1675 Dec 2603 Vol 4.7 bln


Industry Watch

Strong: Information Technology, Consumer Discretionary, Health Care
Weak: Utilities, Communication Services, Energy, Consumer Staples


Moving the Market

-- S&P 500 and Nasdaq set intraday and closing record highs

-- Leadership from the information technology sector, while value stocks faded early gains

-- Possible quarter-end efforts to rebalance into growth stocks

-- Interest rates and the hedging premium remained low


Dow +9.02 at 34292.29, Nasdaq +27.83 at 14528.34, S&P +1.19 at 4291.80

[BRIEFING.COM] The S&P 500 (+0.03%) and Nasdaq Composite (+0.2%) eked out intraday and closing record highs on Tuesday, with the S&P 500 touching the 4300 level for the first time. The Dow Jones Industrial Average (+0.03%) closed fractionally higher like the S&P 500, while the Russell 2000 fell 0.6%.

The session started with a modest rotation into value/cyclical stocks, partly due to a slew of expected dividend increases announced by the banks, a better-than-expected 127.3 reading in the Conference Board's Consumer Confidence Index for June (Briefing.com consensus 120.0), and month-end rebalancing activity.

Value and cyclical stocks stocks faded their early gains throughout the day on no specific catalyst, although some suggested that with the quarter ending tomorrow, there might have been a greater propensity to position into growth stocks amid potentially lower economic growth rates in the second half of the year.

Apple ($AAPL 136.33, +1.55, +1.2%) and Microsoft ($MSFT 271.40, +2.68, +1.0%), the only two companies with market capitalizations over $2.0 trillion, powered the S&P 500 information technology sector (+0.7%) to the top of the sector leaderboard. The Philadelphia Semiconductor Index (+0.8%) was another pocket of strength.

Interestingly, AAPL and MSFT helped overshadow an advancing/declining line that favored declining issues at both the NYSE and Nasdaq. Eight of the 11 S&P 500 sectors closed lower, led by utilities (-1.7%) as the only sector with a decline over 1.0%.

The financials (-0.3%) and energy (-0.5%) sectors were arguably bigger disappointments, though, considering they were up by at least 1.0% in early action. The SPDR S&P Bank ETF ($KBE 51.26, -0.36, -0.7%) extended its two-day decline to 3.1%.

Separately, the market presumably didn't lose sight of the valuation-oriented appeal that a 10-yr yield trading below 1.50% had on growth stocks. The 10-yr yield increased one basis point to 1.48%. Others would add that a CBOE Volatility Index (16.02, +0.26, +1.7%) well under 20.00 was supportive for overall risk sentiment.

The 2-yr yield increased one basis point to 0.26%. The U.S. Dollar Index increased 0.2% to 92.05. WTI crude futures increased 0.4%, or $0.26, to $73.08/BBL.


Reviewing Tuesday's economic data:

  • The Conference Board's Consumer Confidence Index jumped to 127.3 in June (Briefing.com consensus 120.0) from an upwardly revised 120.0 (from 117.2) in May. June marked the highest level for the index since the first pandemic surge in March 2020.
    • The key takeaway from the report is the understanding that consumer spending activity is expected to remain robust in the short-term, evidenced by a rise in plans to take a vacation and an increase in the proportion of consumers planning to buy homes, automobiles, and major appliances.
  • The FHFA Housing Price Index increased 1.8% m/m in April while the S&P Case-Shiller Home Price Index increased 14.9% yr/yr in April.

Looking ahead, investors will receive the ADP Employment Change report for June, the Chicago PMI for June, Pending Home Sales for May, and the weekly MBA Mortgage Applications Index on Wednesday.

  • Russell 2000 +16.9% YTD
  • S&P 500 +14.3% YTD
  • Nasdaq Composite +12.7% YTD
  • Dow Jones Industrial Average +12.0% YTD

Source: (Briefing.com)

Disclosure: I may trade in the ticker symbols mentioned, both long or short. My articles represent my personal opinion and analysis and should not be taken as investment advice. Readers should do their own research before making decisions to buy or sell securities. Trading and investing include risks, including loss of principal.

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