Stocks Gain In Volatile Session
3:30 pm Friday, June 17th, 2022
U.S. stocks wavered Friday, with major indexes extending the whipsaw moves that have injected fresh volatility into markets this week.
The stock market followed Thursday’s slide to levels not seen since late 2020 with a higher start, but it wasn’t long before resistance showed up near yesterday’s opening levels. An early pullback from highs briefly sent the S&P 500 past yesterday’s low, but the index is staying above its early low in early afternoon trade.
A sharp drop in the price of oil has kept the energy sector (-6.1%) at the bottom of today’s leaderboard, but it has also been a positive for the broader market, which has been fretting about inflation. WTI crude is down $7.45, or 6.3%, at $110.14/bbl, nearing its 50-day moving average (109.39) while the energy sector is now down 17.7% for the week.
Besides energy, the lightly-weighted utilities sector (-1.6%) is also down more than 1.0% while heavily-weighted groups like technology (+0.9%), consumer discretionary (+1.2%), financials (+0.3%), and communication services (+0.9%) have helped the market climb off its early low.
The top-weighted technology sector has been supported by gains in some of its largest components like Apple (AAPL) and Microsoft (MSFT), which have masked fresh 52-week lows in 19 components of the sector, including Adobe (ADBE). The stock fell to its lowest level in over two years after the company reported better than expected results for the quarter, but also issued underwhelming guidance.
Cruise lines and other travel-related names have contributed to the outperformance in the discretionary sector, though today’s gains are coming after significant recent weakness. Carnival (CCL) is the leading performer as it climbs off its lowest level since April 2020 while Expedia (EXPE) is rising off its lowest level since late 2020.
Treasuries have also endured some volatility, but recent action has seen a return toward today’s opening highs, putting the complex on course for its third consecutive advance. The 2-yr yield is down two basis points at 3.14% while the 10-yr yield is down ten basis points at 3.21%.
