Stock Market Update

[BRIEFING.COM] The major indices have traded higher thus far. The S&P 500 sports a 0.9% gain, the Dow Jones Industrial Average trades up 0.4%, and the Nasdaq Composite is 1.8% higher than yesterday. Gains are modest compared to yesterday's sharp AI-related declines.

Unlike yesterday, mega caps lead while the "rest" of the market shows some modest weakness. The Vanguard Mega Cap Growth ETF (MGK) trades 2.1% higher. NVIDIA (NVDA 125.71, +7.30, +6.2%) and Broadcom (AVGO 204.07, +1.94, +1.0%) have rebounded after huge losses yesterday. Apple (AAPL 239.11, +9.25, +4.0%) and Microsoft (MSFT 445.56, +11.07, +2.6%) are also influential winners today in front of their earnings reports this week. 

Decliners lead advancers by a roughly 3-to-2 margin at both the NYSE and at the Nasdaq. The equal-weighted S&P 500 shows a 0.5% decline. Eight of the 11 S&P 500 sectors are lower led by utilities (-1.9%), energy (-1.3%), and real estate (-1.2%).

Market participants are reacting to a slate of earnings news from the likes of Royal Caribbean (RCL 264.82, +27.99, +11.8%), Boeing (BA 182.73, +7.57, +4.3%), General Motors (GM 49.06, -5.86, -10.7%), and Lockheed Martin (LMT 466.36, -37.33, -7.4%).

The price action in Treasuries has kept a limit on buying interest. The 10-yr yield is at 4.57%.

Reviewing today's economic data:

• December Durable Orders -2.2% (Briefing.com consensus 0.4%); Prior was revised to -2.0% from -1.1%, December Durable Goods - ex transportation 0.3% (Briefing.com consensus 0.5%); Prior -0.1%
  • The key takeaway from the report, though, is the understanding that new orders for nondefense capital goods excluding aircraft -- a proxy for business spending -- were up 0.5% on the heels of a 0.9% increase in November, thereby softening the disappointment of the headline number.
• November FHFA Housing Price Index 0.3%; Prior was revised to 0.5% from 0.4%
• November S&P Case Shiller Home Price Index 4.3% (Briefing.com consensus 4.2%); Prior 4.2%
• January Consumer Confidence 104.1 (Briefing.com consensus 108.1); Prior was revised to 109.5 from 104.7
  • The key takeaway from the report is that consumers, in general, remained pessimistic about future employment prospects.