Stocks Resume Sell-Off On Rate Hike Fear
2:33 pm Thursday, September 15th, 2022
trade skews to the negative side of things. There were modest gains at the open but they quickly faded on renewed selling interest that took the S&P 500 below Tuesday’s low (3,921). Currently, the major indices trade just off session lows after the S&P 500 found support at the 3,900 level. The Nasdaq Composite is lagging its peers as mega cap stocks drive index level performance.
There was a slew of mixed economic data and corporate news ahead of the open that garnered mixed reactions from market participants. A weak performance from mega cap stocks, though, soon took over as the driver of price action today.
The Vanguard Mega Cap Growth ETF (MGK) is down 1.3% versus a 0.3% loss in the Invesco S&P 500 Equal Weight ETF (RSP) and a 0.7% loss in the S&P 500.
Though mega caps are under more pressure than the broader market, many stocks are suffering losses today. Every S&P 500 sector trades in negative territory except health care (+0.8%) and financials (+0.6%). Rounding out the bottom of the pack is energy (-2.1%), utilities (-2.1%), and information technology (-1.9%).
Health care is getting a boost from Humana (HUM) after the company raised its FY22 EPS guidance.
On the flip side, Adobe (ADBE) is dragging on the information technology sector as investors react negatively to the company’s $20 billion cash-and-stock acquisition of Figma. Semiconductor stocks are also weak. The PHLX Semiconductor Index is down 1.1%.
Energy stocks are suffering losses today amid falling energy prices that are being attributed to the news that a national railroad workers strike has been averted. WTI crude oil futures are down 3.5% to $85.46/bbl and natural gas futures are down 7.3% to $8.45/mmbtu.
Treasury yields had moderated somewhat earlier, adding support for a modestly higher open, but they have since climbed back toward session highs. The 2-yr note yield is up nine basis points to 3.86% and the 10-yr note yield is up four basis points to 3.46%.
