Stocks End Higher in Volatile Session
4:16 pm Thursday, August 19th, 2021
The S&P 500 rose Thursday, stabilizing after a bumpy morning and two days of declines. Stocks hit turbulence this week after major indexes posted a series of record highs. Investors broadly remain upbeat about the outlook for share prices given the rapid pace of earnings growth.
Pullback concerns have eased because the market’s largest stocks have picked up the slack. The Vanguard Mega Cap Growth ETF (MGK) was up 0.8%, with NVIDIA (NVDA) up 4% following its earnings report and Microsoft (MSFT) trading at a record high.
Accordingly, the information technology sector (+1.4%) stands atop the leaderboard, thanks to its mega-cap components and Cisco (CSCO), which is another earnings winner.
Growth concerns, though, are being manifested in the underperformance of the cyclical stocks, relative strength in the counter-cyclical stocks, a three-basis point decline in the 10-yr yield to 1.24%, and weaker oil ($63.04/bbl, -2.17, -3.3%)/copper ($4.04, -0.08, -2.0%) prices.
The energy sector (-3.0%) is following oil prices lower with a 3% decline while the financials (-0.6%), materials (-0.7%), and industrials (-0.5%) sectors are down more modestly. Declining issues outpace advancing issues by a 3:1 margin at the NYSE, providing a better indication of the broader market.
The latest weekly initial and continuing claims report hasn’t done much to ease growth concerns, even though it showed continued improvement in both initial and continuing claims. Initial jobless claims were better than expected at 348,000 (Briefing.com consensus 370,000).
In other earnings news, Robinhood Markets (HOOD) provided a cautious outlook for the third quarter while Macy’s (M) did just about everything right as shares spike 20%.
