Stock Market Update

[BRIEFING.COM] Stocks started the final session of the week on solid footing. A drop in market rates fueled broad buying interest, supported by buy-the-dip trading after this week's losses. Initial moves had the major indices trading up and market breadth favoring advancers.

The vibe in the market shifted when Treasury yields moved higher, which has been a limiting factor for equities through the week. The 10-yr yield dipped below 4.20% earlier, but settled three basis points higher than yesterday at 4.23%. The 2-yr yield settled three basis points higher at 4.10%.

Decliners led advancers by a 2-to-1 margin at the NYSE and by a 4-to-3 margin at the Nasdaq. The equal-weighted S&P 500 settled 0.5% lower. 

The market-cap weighted S&P 500 closed little changed from yesterday and the Nasdaq Composite settled 0.6% higher, boosted by strength in mega caps and semiconductor shares. The Vanguard Mega Cap Growth ETF (MGK) closed 0.5% higher and the PHLX Semiconductor Index (SOX) jumped 1.1%. 

This price action propelled the communication services (+0.7%), information technology (+0.6%), and consumer discretionary (+0.5%) sectors to the top of the leaderboard today. The influential financial sector closed near the bottom of the lineup, 1.1% lower than yesterday. 

• Nasdaq Composite: +23.4% YTD
• S&P 500: +21.8% YTD
• Dow Jones Industrial Average: +11.7% YTD
• S&P Midcap 400: +11.7% YTD
• Russell 2000: +8.9% YTD

Reviewing today's economic data:

• September Durable Orders -0.8% (Briefing.com consensus -0.9%); Prior was revised to -0.8% from 0.0%, September Durable Goods - ex transportation 0.4% (Briefing.com consensus -0.1%); Prior was revised to 0.6% from 0.5%
  • The key takeaway from the report is that it had a split growth personality. A 0.5% increase in nondefense capital goods orders excluding aircraft conveyed a pickup in business spending, yet the 0.3% decline in shipments of nondefense capital goods orders excluding aircraft, which factors into GDP computations, declined 0.3% on the heels of a 0.1% decline in August and a 0.4% decline in July.
• October Univ. of Michigan Consumer Sentiment - Final 70.5 (Briefing.com consensus 68.9); Prior 68.9
  • The key takeaway from the report is that consumer sentiment increased for the third consecutive month in spite of the election uncertainty.

Looking ahead, there is no US economic data of note on Monday.