Stock Market Update

[BRIEFING.COM] The stock market closed with losses, but the major indices climbed off session lows in front of the close. Ultimately, the S&P 500 settled 0.6% lower and the Nasdaq Composite closed down 1.1% from yesterday. The index deterioration from opening levels coincided with mega caps and semiconductor-related shares building on initial losses in front of influential earnings news from the spaces after the close.

The PHLX Semiconductor (SOX) logged a 1.8% loss and the Vanguard Mega Cap Growth ETF (MGK) fell 1.1%. This price action had an outsized impact on index performance while the Invesco S&P 500 Equal Weight ETF (RSP) closed modestly lower than yesterday, down 0.3%.

The price action in semiconductor shares and mega caps clipped the information technology sector, which declined 1.3%. A sharp decline in shares of Super Micro Computer (SMCI 443.49, -104.15, -19.0%), the worst performing stock in the S&P 500, also contributed to the underperformance of the info tech sector.

SMCI on news that it is delaying its annual 10K filing for the fiscal year ended June 30, 2024, to "complete its assessment of the design and operating effectiveness of its internals controls over financial reporting." 

Bath & Body Works (BBWI 32.29, -2.43, -7.0%) and J.M Smucker (SJM 114.73, -12.35, -4.6%) were the next worst performing stocks in the S&P 500 after SMCI following their quarterly results. 

The financial sector (+0.3%) and the health care sector (+0.1%) led S&P 500 sectors and were alone in positive territory at the close. Gains in many bank stocks boosted the financial sector, along with the SPDR S&P Bank ETF (KBE), which logged a 0.8% gain, and the SPDR S&P Regional Banking ETF (KRE), which settled 0.9% higher.

The gain in Berkshire Hathaway (BRK.B 464.59, +3.96, +0.9%) also contributed to the performance of the financial sector after briefly topping a $1 trillion value in terms of market capitalization today.

Volume was still below-average at the NYSE, which has been the case all week, due to light participation in front of Labor Day.

The 10-yr note yield settled one basis point higher at 3.84% and the 2-yr note yield settled three basis points lower at 3.87%.

• S&P 500: +17.2% YTD
• Nasdaq Composite: +17.0% YTD
• S&P Midcap 400: +10.0% YTD
• Dow Jones Industrial Average: +9.0% YTD
• Russell 2000: +8.0% YTD

Reviewing today's economic data:

• Weekly MBA Mortgage Applications Index 0.5%; Prior -10.1

Market participants will receive the following economic data on Thursday: 

• 8:30 ET: Q2 GDP -- second estimate (prior 2.8%), Q2 GDP Deflator -- second estimate (prior 2.3%), weekly Initial Claims (prior 232,000), Continuing Claims (prior 1.863 mln), advance July goods trade balance (prior -$96.6 bln), advance July Retail Inventories (prior -$96.8 bln), advance Retail Inventories (prior 0.7%), and advance Wholesale Inventories (prior 0.2%)
• 10:00 ET: July Pending Home Sales (Briefing.com consensus 1.2%; prior 4.8%)
• 10:30 ET: Weekly natural gas inventories (prior +35 bcf)