Stock Market Update

[BRIEFING.COM] The stock market trades higher, bolstered by Apple (AAPL 238.34, +0.68, +0.3%) after its earnings report. The S&P 500 sports a 0.7% gain and the Nasdaq Composite trades 1.2% higher. 

Other mega caps are trading up also. The Vanguard Mega Cap Growth ETF (MGK) shows a 1.2% gain. This price action has led the information technology (+1.0%), communication services (+1.5%), and consumer discretionary (+1.5%) sectors to trade at the top of the leaderboard among the 11 sectors. 

Market participants are also digesting this morning's economic data, which featured a core-PCE Price Index (the Fed's preferred inflation gauge) that was in-line with expectations. It was up 2.8% year-over-year for the third month in a row following a 0.2% month-over-month increase. Treasury yields are lower in response. The 10-yr yield is at 4.51% and the 2-yr yield is at 4.19%.

Responses to other earnings news has been mixed. AbbVie (ABBV 186.46, +10.80, +6.2%), Atlassian (TEAM 310.60, +43.65, +16.4%), and Aon (AON 372.45, +0.30, +0.1%) are among the winning standouts in that respect.

Vertex Pharmaceuticals (VRTX 469.64, +31.24, +7.1%), which won FDA approval of its non-opioid painkiller drug, JOURNAVX, is another standout.

Exxon Mobil (XOM 1007.57, -2.04, -1.8%) and Chevron (CVX 150.95, -5.36, -3.4%) are both lower after reporting results, along with Colgate-Palmolive (CL 86.59, -4.31, -4.7%) and PPG Industries (PPG 116.31, -6.43, -5.2%).

The price action in XOM and CVX has pinned the S&P 500 energy sector in last place on the leaderboard, down 1.8%.

Reviewing today's economic data:

• December Personal Income 0.4% (Briefing.com consensus 0.4%); Prior 0.3%, December Personal Spending 0.7% (Briefing.com consensus 0.5%); Prior was revised to 0.6% from 0.4%, December PCE Prices 0.3% (Briefing.com consensus 0.3%); Prior 0.1%, December PCE Prices - Core 0.2% (Briefing.com consensus 0.2%); Prior 0.1%
  • The key takeaway from the report is that consumer spending is strong (which we knew from the Adv. Q4 GDP report) and that inflation is sticky above the Fed's 2% target, making it clear why the Fed said it isn't in a hurry to adjust its policy stance.
• Q4 Employment Cost Index 0.9% (Briefing.com consensus 0.9%); Prior 0.8%
  • The key takeaway from the report is that compensation costs moderated to 3.8% for the 12-month period ending in December 2024 from 4.2% for the 12-month period ending in December 2023.
• January Chicago PMI 39.5 (Briefing.com consensus 41.5); Prior 36.9