Stock Market Update

[BRIEFING.COM] The market has exhibited mixed action at the index level as participants wait for Tuesday's election. The Russell 2000 outperforms other major indices, trading 0.9% higher, while the S&P 500 (-0.1%), Nasdaq Composite (-0.1%), and Dow Jones Industrial Average (-0.4%) trade lower. 

The S&P 500 and Nasdaq Composite had been trading higher earlier in the session, but turned lower as Treasury yields moved up. The 10-yr yield hit 4.26% earlier, but sits at 4.31% now. The S&P 500 briefly traded below its 50-day moving average (5,703) at its lowest level today. 

Rising market rates reflect some recalibration in expectations for an election sweep, along with some safe-haven action following news that Iran is planning a "strong and complex" response against Israel, according to The Wall Street Journal. 

The mixed action in equities also reflects hesitation in front of the FOMC policy announcement on Thursday and a slate of earnings reports through the week. 

Five of the S&P 500 sectors trade up and six sectors trade lower. The energy sector (+1.5%) leads the pack amid rising oil prices ($71.43, +1.94, +2.8%). The utilities sector sports the largest decline, trading 1.4% lower due to weakness in nuclear power stocks following the news that the Federal Energy Regulatory Commission rejected an agreement between Talen Energy (TLN 166.13, -7.75, -4.5%) and Amazon.com (AMZN 196.65, -2.25, -1.1%) whereby an Amazon data center could get a direct connection to a nuclear power plant.

In other news, NVIDIA (NVDA 137.75, +2.34, +1.7%) and Sherwin-Williams (SHW 372.00, +14.03, +3.9%) will be replacing Intel (INTC 22.43, -0.78, -3.3%) and Dow Inc. (DOW 47.60, -1.36, -2.8%) in the Dow Jones Industrial Average, effective prior to the open of trading on Friday, November 8. 

Reviewing today's economic data:

• Factory orders declined 0.5% month-over-month in September (Briefing.com consensus -0.4%) following a downwardly revised 0.8% decline (from -0.2%) in August. Excluding transportation, factory orders rose 0.1% on the heels of a 0.2% decline in August. Shipments of manufactured goods fell 0.4% in September following a 0.7% decline in August.
  • The key takeaway from the report is that transportation equipment orders (-3.1%), led by weakness in nondefense aircraft and parts orders (-22.7%) and defense aircraft and parts orders (-23.7%), were the primary basis for the decline in factory orders in September.