Stock Market Update

[BRIEFING.COM] The stock market has traded higher thus far. The S&P 500 opened above its 50-day moving average (5,948) and has traded above the 6,000 level through most of the session so far. The Nasdaq Composite shows a 1.5% gain and the Dow Jones Industrial Average trades 0.4% higher.

A big move in NVIDIA (NVDA 151.51, +7.02, +4.9%) has boosted index performance ahead of CEO Jensen Huang's keynote address at the Consumer Electronics Show (CES) tonight at 6:30 p.m. PST (9:30 p.m. ET). Other semiconductor stocks have also outperformed, driven by enthusiasm around AI after Foxconn's impressive 15% yr/yr increase in Q4 revenues. 

The PHLX Semiconductor Index (SOX) shows a 3.6% gain. This price action has an outsized influence on the major indices, but many other names are participating in upside moves. The equal-weighted S&P 500 is up 0.5% from Friday and eight of the 11 S&P 500 sectors are higher. 

The information technology sector leads the pack, trading 1.9% higher and the communication services sector trades 1.8% higher. The utilities sector shows the largest decline, trading 0.7% lower.

Advancers lead decliners by a 3-to-2 margin at the NYSE and a less than 2-to-1 margin at the Nasdaq.

The overall bias is also related to President-elect Trump pushing for the passage of a single reconciliation bill that would include extending the 2017 tax cuts.

The 10-yr yield is up three basis points to 4.63%.

Reviewing today's economic data:

• Factory orders decreased 0.4% month-over-month in November (Briefing.com consensus -0.3%) following an upwardly revised 0.5% increase (from 0.2%) in October. Excluding transportation, factory orders rose 0.2% on the heels of a 0.2% increase in October. Shipments of manufactured goods edged 0.1% higher in November following a 0.2% decline in October.
  • The key takeaway from the report is that the weakness in factory orders was concentrated in the volatile transportation equipment space; otherwise, there was a modest pickup in order activity.
• December S&P Global US Services PMI 56.8 (prior 58.5) versus final reading of 56.1 for November. The dividing line between expansion and contraction is 50.0, and although the final December reading was revised down from the preliminary reading of 58.5, the final reading for December was above the final reading for November, indicating that the pace of expansion accelerated versus the prior month.