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End of Day Briefing - Tuesday Feb 11, 2020

S&P 500 and Nasdaq extend winning ways with small gains

11-Feb-20
Dow -0.48 at 29276.25, Nasdaq +10.55 at 9638.96, S&P +5.66 at 3357.75

[BRIEFING.COM] The large-cap indices started Tuesday's session hitting intraday highs, but stocks steadily pulled back throughout the day amid a lack of follow-though buying interest. The S&P 500 (+0.2%) and Nasdaq Composite (+0.1%) still eked out closing records, while the Dow Jones Industrial Average (unch) finished flat. The Russell 2000 rose 0.6%.

The initial boost in the market was attributed to reports indicating that the rate of new coronavirus cases was slowing down and a view that monetary policy will remain favorable given the risks that remain due to the virus. Fed Chair Powell told the House Financial Services Committee today that the Fed is "closely monitoring" the situation. 

The S&P 500 real estate (+1.2%) and energy (+1.0%) sectors advanced at least 1.0%. The communication services (-0.4%), consumer staples (-0.3%), and information technology (-0.3%) sectors underperformed, with the former pressured by Facebook ($FB 207.19, -5.87, -2.8%) after it was downgraded to Sell from Hold at Pivotal Research.

The ratio of advancers to decliners in the NYSE was more than 2:1, but today's advance was slim given the missing leadership from the mega-cap technology stocks. On a related note, the FTC said it will be examining small acquisitions made by Apple ($AAPL 319.61, -1.94, -0.6%), Microsoft ($MSFT 184.44, -4.26, -2.3%), Alphabet ($GOOG 1508.79, +0.11, unch), Amazon ($AMZN 2150.80, +16.89, +0.8%), and Facebook.

Separately, the merger agreement between Sprint ($S 8.52, +3.72, +77.5%) and T-Mobile US ($TMUS 94.49, +9.96, +11.8%) was finally approved by a federal court in New York. Shares of Sprint surged more than 75% in response.

In earnings news, Under Armour ($UAA 16.59, -3.86, -18.9%) and Goodyear Tire ($GT 11.56, -1.63, -12.4%) disappointed investors with results and/or guidance and both mentioned the negative impact caused by the coronavirus. Burlington Stores ($BURL 243.45, +14.95, +6.5%) outperformed after raising guidance. 

U.S. Treasuries finished on a lower note and barely moved during Fed Chair Powell's congressional testimony. The 2-yr yield increased four basis points to 1.42%, and the 10-yr yield increased four basis points to 1.42%. The U.S. Dollar Index declined 0.1% to 98.75. WTI crude rose 0.9%, or $0.44, to $50.01/BBL. 

Reviewing Tuesday's economic data:

  • The NFIB Small Business Optimism Index for January increased to 104.3 from 102.7 in December.
  • The December Job Openings and Labor Turnover Survey showed job openings decline to 6.423 million from a revised 6.787 million in November (from 6.800 million).

Looking ahead, investors will receive the weekly MBA Mortgage Applications Index and the Treasury Budget for January on Wednesday. 

  • Nasdaq Composite +7.4% YTD
  • S&P 500 +3.9% YTD
  • Dow Jones Industrial Average +2.6% YTD
  • Russell 2000 +0.5% YTD

Market Snapshot

Dow29276.25-0.48(0.00%)
Nasdaq9638.96+10.55(0.11%)
SP 5003357.75+5.66(0.17%)
10-yr Note -2/321.594
NYSEAdv 1987 Dec 906 Vol 835.3 mln
NasdaqAdv 1965 Dec 1192 Vol 2.4 bln

Industry Watch

Strong: Real Estate, Energy
Weak: Communication Services, Consumer Staples, Information Technology

Moving the Market

-- S&P 500 and Nasdaq eke out closing records in lackluster session

-- Fed Chair Powell testifies before Congress, says closely monitoring the coronavirus

-- Rate of new cases is reportedly slowing down

-- Relative strength in the real estate space


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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