Daily Sector Wrap
Updated: 25-Apr-24 16:35 ET |
Stocks stage big recovery after weak open |
It wasn't a strong day in the stock market, but importantly, it wasn't a particularly weak day either. The major indices closed with declines, but staged a big recovery off their lows for the session. At their worst levels of the day, the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average were down 1.6%, 2.3%, and 1.8%, respectively. Losses by the close ranged from 0.5% to 1.0%. Shortly after the open, decliners led advancers by an 11-to-2 margin at the NYSE and a better than 3-to-1 margin at the Nasdaq. At the close, decliners lead advancers by a better than 2-to-1 margin at the NYSE and a 2-to-1 margin at the Nasdaq. The initial move lower at the open was driven by negative responses to earnings news from some widely held names like Meta Platforms (META 441.38, -52.12, -10.6%) and Dow components IBM (IBM 168.91, -15.19, -8.3%) and Caterpillar (CAT 338.00, -25.52, -7.0%). There were also some concerns about growth and about the Fed's rate cut path driving early downside moves. This followed the Advance Q1 GDP report, which showed weaker growth and higher inflation, and the weekly jobless claims report, which showed ongoing strength in the labor market. The economic data sent yields sharply higher, contributing to the initial move lower in stocks. Treasuries ultimately settled off their intraday high yields, though. This was partially in response to today's $44 billion 7-yr note sale, which met solid demand. Many stocks were participating in early downside moves, but some areas of the market recovered by the close. The S&P 500 materials (+0.7%), energy (+0.5%), industrials (+0.3%), utilities (+0.3%), and information technology (+0.2%) sectors were all lower in the early going before closing with gains. The info tech sector was boosted by gains in semiconductor-related stocks, which showed relative strength through the entire session. The PHLX Semiconductor Index (SOX) gained 2.0% due to the notion that chip makers will be beneficiaries of the heavy investment in AI by Meta.
Reviewing today's economic data:
Friday's economic data include:
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