Stock Market Update

[BRIEFING.COM] The stock market opened on a cautious note, reacting to rising geopolitical tensions. This followed reports that President Putin had lowered Russia's threshold for using nuclear weapons, that Ukraine had launched U.S.-made missiles into Russia, and that Russian Foreign Minister Lavrov had called the attack on Russia an "escalation signal."

Stocks quickly brushed off fears related to the Ukraine situation and the major equity indices settled mostly higher. The S&P 500 settled 0.4% higher, the Russell 2000 was up 0.8%, and the Nasdaq Composite jumped 1.0%. 

The bond market didn't show any signs of panic related to the geopolitical developments, which helped the equity market remain calm, too. The 2-yr yield dropped one basis point to 4.27% and the 10-yr yield dropped four basis points to 4.38%.

Some defense-related names benefitted from the rising tensions overseas. Dow component Boeing (BA 145.60, +1.73, +1.2%) was a standout in that respect. Fellow Dow component Walmart (WMT 86.60, +2.52, +3.0%) was another influential winner, responding to earnings results. 

Mega caps stocks and chipmakers were also favored by buyers today. The Vanguard Mega Cap Growth ETF (MGK) jumped 1.0% and the PHLX Semiconductor Index (SOX) registered a 0.6% increase.

• Nasdaq Composite: +26.5%
• S&P 500: +24.1%
• S&P Midcap 400: +15.6%
• Dow Jones Industrial Average: +14.8%
• Russell 2000: +14.7%

Reviewing today's economic data:

• October Housing Starts 1.311 mln (Briefing.com consensus 1.340 mln); Prior was revised to 1.353 mln from 1.354 mln, October Building Permits 1.416 mln (Briefing.com consensus 1.441 mln); Prior was revised to 1.425 mln from 1.428 mln
  • The key takeaway from the report is that it included some weather impact from the hurricanes, evidenced by a 10.2% month-over-month decline in starts in the South -- the nation's largest homebuilding region -- but overall it was a generally soft report on a year-over-year basis with total starts down 4.0% and total permits down 7.7%.

Looking ahead, Wednesday's calendar features the weekly MBA Mortgage Applications Index at 7:00 ET and the weekly EIA crude oil inventories at 10:30 ET.