Stock Market Update

[BRIEFING.COM] The stock market started the final session of the week on an upbeat note. Broad buying interest had many stocks moving higher and the major indices all showing gains. 

The early bias was supported by calm behavior in the Treasury market, which had yields slightly lower than yesterday. Market rates have increased, though, and buying activity in the equity market has dissipated as the session has progressed. The 10-yr yield dipped below 4.20% earlier before hitting 4.22%.

The S&P 500 (+0.5%) and Nasdaq Composite (+1.3%) have maintained their positive positions thanks to gains in the mega cap and semiconductor space. The equal-weighted S&P 500 trades fractionally lower, reflecting an otherwise broad pullback in equities. 

The Vanguard Mega Cap Growth ETF (MGK) shows a 1.2% gain and the PHLX Semiconductor Index (SOX) sports a 2.5% increase.

Mega cap and chipmaker leadership has influenced S&P 500 sector performance. The information technology (+1.4%), communication services (+1.3%), and consumer discretionary (+1.0%) sectors are the only sectors trading up more than 1.0%.

On the flip side, the heavily-weighted financial sector is among the worst performers, down 0.8% from yesterday. 

Bank stocks have underperformed through the entire session so far, even while the rest of the market was in rally-mode. The SPDR S&P Bank ETF (KBE) shows a 1.3% decline and the SPDR S&P Regional Banking ETF (KRE) sports a 1.4% decline.

Principal Fincl (PFG 80.90, -8.75, -9.8%) and Hartford Financial (HIG 112.36, -8.10, -6.7%) garnered negative responses to earnings news and are the biggest laggards in the financial sector.

Capital One (COF 165.59, +12.32, +8.0%) is a winning standout from the sector after reporting quarterly results.

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.