Stock Market Update

[BRIEFING.COM] The stock market exhibited some turbulence at the index level amid mixed headlines and corporate news. The S&P 500 (+0.1%) and the Nasdaq Composite (-0.1%) traded above and below prior closing levels while the Dow Jones Industrial Average (-1.3%) lagged its peers.

The underperformance of the DJIA was due to a significant earnings-related loss in UnitedHealth (UNH 454.11, -130.93, -22.4%), which is among the heaviest components in the price-weighted average. 

The overall bias in the market was positive, however. The equal-weighted S&P 500 closed 0.7% higher, the Russell 2000 registered a 0.9% gain, and the S&P Mid Cap 400 was up 0.8%. Also, market breadth was positive through the entire session. Advancing issues led declining issues by a 3-to-1 ratio at the NYSE and by a 2-to-1 margin at the Nasdaq.

Outsized moves were mostly reserved for individual stocks with specific catalysts. Eli Lilly (LLY 839.96, +105.06, +14.3%) was an influential winner after announcing positive trial results for its weight-loss drug pill.

Alphabet (GOOG 153.36, -2.14, -1.4%) was another influential mover, dropping after a Reuters report indicating a federal judge ruled that it holds an illegal monopoly in online advertising technology.

Treasuries settled with losses. The 10-yr yield was up five basis points today, and down 16 basis points this week, to 4.33%.

• Dow Jones Industrial Average: -8.0% YTD
• S&P 500: -10.2% YTD
• S&P Midcap 400: -12.1% YTD
• Nasdaq Composite: -15.7% YTD
• Russell 2000: -15.7% YTD

Reviewing today's economic data:

• March Housing Starts 1.324 mln (Briefing.com consensus 1.418 mln); Prior was revised to 1.494 mln from 1.501 mln, March Building Permits 1.482 mln (Briefing.com consensus 1.455 mln); Prior was revised to 1.459 mln from 1.456 mln
  • The key takeaway from the report is that single-unit starts (-14.2%) and permits (-2.0%) were both down during the month, as affordability constraints driven by higher mortgage rates and building costs presumably curtailed homebuilder activity.
• April Philadelphia Fed Index -26.4 (Briefing.com consensus 10.0); Prior 12.5
  • The key takeaway from the report is that the index for new orders dropped sharply to -34.2 from 8.7, signaling a notable dropoff in demand; meanwhile, the prices paid index rose to 51.0 from 48.3.
• Weekly Initial Claims 215K (Briefing.com consensus 225K); Prior was revised to 224K from 223K, Weekly Continuing Claims 1.885 mln; Prior was revised to 1.844 mln from 1.850 mln
  • The key takeaway from the report is that the low level of initial jobless claims will support the idea that the labor market is still in a solid position overall. Additionally, this should factor well in forecasts for April nonfarm payrolls since it covers the period in which the employment survey is conducted.

Looking ahead to Monday, market participants receive the following data:

• March Leading Indicators (prior -0.3%) at 10:00 ET