Stock Market Update

[BRIEFING.COM] The stock market has retreated today due to persisting weakness in mega-cap and tech names, with this week's pullback reflecting a possible correction after a massive rally from April lows.

Losses are widest in the consumer discretionary (-1.2%), information technology (-1.2%), and communication services (-0.7%) sectors, though they are off their session lows that came around 11:00 ET. Separately, the industrials (-0.2%) and utilities (-0.2%) sectors face more modest losses

The Vanguard Mega Cap Growth ETF is down 1.2% today, as Microsoft (MSFT 505.80, -3.97, -0.78%) is the only "magnificent 7" stock with a loss narrower than 1.0%, though smaller-cap stocks are also losing ground, just at a lesser rate. The S&P Mid Cap 400 (-0.4%) and Russell 2000 (-0.5%) hold similar losses. 

While there is still a gap between the S&P 500 Equal Weighted Index (-0.2%) and the market-weighted S&P 500 (-0.5%), it has lessened as the market has improved from its session lows.

Nonetheless, today's profit taking has permeated through to the semiconductor realm, leading to a 1.7% loss in the PHLX Semiconductor Index. 

NVIDIA (NVDA 172.98, -2.66, -1.51%) is down (though much improved from an earlier 3.5% loss), and Intel (INTC 23.72, -1.58, -6.26%) loses the bulk of yesterday's gains that followed reports that SoftBank is investing $2 billion in the company. 

CNBC reported that Intel is in conversations with investors, seeking to offer equity for a discounted price. The news follows earlier reports that the Trump administration is considering taking an equity stake in the company in exchange for access to CHIPS Act funds. 

Pressure in technology contributes to the Nasdaq Composite's (-1.1%) underperformance, while the S&P 500 (-0.5%) and DJIA (-0.1%) hold more modest losses. 

Meanwhile, defensive stocks are faring better today as the consumer staples (+0.8%) and health care (+0.5%) sectors expand upon yesterday's gains. 

Walmart (WMT 102.40, +1.12, +1.10%) trades higher ahead of its earnings report tomorrow, with the market digesting mixed earnings reports from other retail giants today. TJX (TJX 138.99, +4.37, +3.25%) impressed and trades higher as a result, while Target (TGT 97.74, -7.62, -7.23%) disappointed investors after posting a modest EPS beat but naming an in-house candidate, COO Michael Fiddelke, as the new CEO. 

So far, earnings have not had a material effect on the broader market this week.

The market largely looks ahead to Fed Chair Powell's Friday speech at Jackson Hole, which will give a better sense of upcoming monetary policy. At 14:00 ET, the market will receive the minutes from the July FOMC meeting, which could illuminate any sympathy from other members towards Fed Governors Bowman and Waller's dissent at that juncture. 

Separately, Bloomberg reports that President Trump is calling on Fed Governor Cook to resign amid allegations of possible mortgage fraud.

Reviewing today's data:

• The MBA Mortgage Applications Index for the week ended August 16 decreased by -1.4%, down from a prior increase of 10.9%.