US Stocks End Lower, But Off Session Lows
4:29 pm Monday, May 17th, 2021
The Wall Street closed lower led by drop in tech stocks, but well off session lows. The energy (+1.7%) and materials (+1.1%) sectors were leading the comeback effort.
Dow Jones Industrial Average 34,327.79 −54.34 (0.16%)
Nasdaq Composite 13,379.05 −50.93 (0.38%)
S&P 500 4,163.29−10.56 (0.25%)
Russell 2000 Index 2,225.35 + 2.63 (0.12 %)
Bitcoin 44,201.82 -1,319.95(-2.90%)
Price action today has reflected consolidation activity and even a bit of the Monday’s given the sideways trend in negative territory. The benchmark index is trading at the same level from mid-April, as the market tries to find new catalysts that will support greater earnings potential.
There aren’t any specific news catalysts to convincingly explain the negative bias, but sentiment is feeling a bit uneasy as selling resumes in the growth-stock space after a modest two-day bounce. Presumably, growth stocks are getting clipped by lingering concerns that inflation expectations will continue to put upwards pressure on long-term interest rates.
The U.S. Treasury complex began the week on a quiet note with the long bond spending the day slightly ahead. However, the day’s action unfolded in a narrow range that kept the 10-yr yield right above its 50-day moving average (1.629%). The long bond and the 10-yr note opened with modest gains after a quiet overnight session. However, the early strength did not invite follow-through buying.
Today’s Data: The Empire State Manufacturing Survey fell to 24.3 in May from 26.3 in April.
The NAHB Housing Market Index remained at 83 in May.
Separately, several of the media stocks within the communication services sector were trading lower after AT&T Inc. (NYSE:T) WarnerMedia and Discovery (NASDAQ:DISCA) agreed to combine in a Reverse Morris Trust transaction. Discovery shares fell 5.05% after opening with an 11% gain.
Airbnb (NASDAQ:ABNB) was facing its own headwind in that its post-IPO expiration lockup expires today, reportedly freeing about 80% of restricted shares for trading. ABNB shares closed down 6.16% and down 40% from its all-time high.
