Stock Market Update

[BRIEFING.COM] The stock market exhibited lackluster action today. The S&P 500 (+0.2%), Nasdaq Composite (+0.2%), Dow Jones Industrial Average (+0.2%), and Russell 2000 (+0.2%) ultimately settled with modest gains near their best levels of the day. 

The limited action followed strong gains this week that brought the market back to levels seen in front of last week's sharp selloff. The market-cap weighted S&P 500 jumped 3.9% since last Friday and the equal-weighted S&P 500 logged a 2.5% gain this week.

A disappointing housing starts and building permits report for July and a negative response to earnings results from chip equipment maker Applied Materials (AMAT 207.90, -3.93, -1.9%) also acted as limiting factors for equities today.

Even at the individual level, movement was relatively muted in stocks. The best -- Dexcom (DXCM 74.65, +2.29, +3.2%) -- and worst -- Amcor (AMCR 10.45, -0.40, -3.7%) -- performing stocks in the S&P 500 moved less than 4.0% in either direction. 

None of the S&P 500 sectors moved more than 0.6% in either direction. The financial sector showed relative strength, closing 0.6% higher, and the industrial sector (-0.2%) logged the "biggest" loss.

The 2-yr note yield settled four basis points lower at 4.06% and the 10-yr note yield settled four basis points lower to 3.89%.

• Nasdaq Composite:+17.5% YTD
• S&P 500: +16.5% YTD
• S&P Midcap 400: +8.3% YTD
• Dow Jones Industrial Average: +7.9% YTD
• Russell 2000: +5.7% YTD

Reviewing today's economic data:

• July Building Permits 1.396 mln (Briefing.com consensus 1.440 mln); Prior was revised to 1.454 mln from 1.446 mln, July Housing Starts 1.238 mln (Briefing.com consensus 1.350 mln); Prior was revised to 1.329 mln from 1.353 mln
  • There is some chatter that Hurricane Beryl had some influence over the disappointing data, yet that isn't a totally adequate excuse given the decline in single-unit starts and permits in the West where Hurricane Beryl had zero impact. The key takeaway, then, is that conditions in the residential construction market remain soft with higher rates acting as a constraint.
• August Univ. of Michigan Consumer Sentiment - Prelim 67.8 (Briefing.com consensus 66.7); Prior 66.4
  • The key takeaway from the report is that sentiment in August was swayed by political developments, yet the take-home point is that inflation is still the top concern among consumers.

Looking ahead, Monday's economic data is limited to the July Leading Indicators Index at 10:00 ET. Influential data next week include the Existing Home Sales report (Thursday) and the New Home Sales report (Friday).