Stock Market Update

[BRIEFING.COM] Stocks opened to broad gains this morning in reaction to geopolitical developments that prompted a pullback in oil prices. Notably, The Wall Street Journal reported that the Trump administration plans to announce a multi-country coalition that will escort ships through the Strait of Hormuz, with the announcement to come as soon as this week. While oil prices remain subdued (crude oil is currently down $2.71 or 2.8% to $96.00 per barrel), the S&P 500 (+1.0%), Nasdaq Composite (+1.3%), and DJIA (+0.8%) have given back a chunk of their early gains. 

Though the major averages have taken a modest step back from their earlier highs, strength remains broad, with nine S&P 500 sectors currently trading higher. 

The information technology sector (+1.5%) has maintained its lead throughout the session and has experienced the least impact from the recent pullback. Semiconductor stocks, and in particular, memory storage names such as Sandisk (SNDK 713.82, +52.20, +7.89%) and Micron (MU 449.62, +23.50, +5.51%) are among the outperformers, pushing the PHLX Semiconductor Index 2.4% higher. 

NVIDIA (NVDA 184.42, +4.17, +2.31%) is one of several "magnificent seven" names that trades higher today as the market waits for CEO Jensen Huang to kick off his keynote address at 2:00 p.m. ET at the company's GTC event. 

Tesla (TSLA 397.29, +6.09, +1.56%) provides solid mega-cap leadership for the consumer discretionary sector (+1.1%), though it currently trades roughly one percentage point under its session highs. 

Elsewhere in the sector, cruise lines such as Norwegian Cruise Line (NCLH 19.69, +0.82, +4.37%) and Royal Caribbean (RCL 280.35, +7.81, +2.87%) are outperforming after the recent surge in oil prices pressured the group. 

The financials (+0.7%) and communication services (+0.7%) sectors are also among the top movers as cyclical sectors generally outperform today, though both sectors are off of their session highs as well. 

Meanwhile, the materials sector (-0.1%) lags, with fertilizer names such as CF Industries (CF 121.31, -8.26, -6.37%) and Mosaic (MOS 27.76, -1.54, -5.27%) among some of the worst-performing S&P 500 names today. 

The consumer staples sector (flat) is another underperformer, as weakness in food stocks weighs against a solid gain in Dollar Tree (DLTR 114.30, +6.84, +6.37%) after the company reported earnings. 

So far, a lower price of oil and optimism that tanker traffic through the Strait of Hormuz could begin to pick up have provided a supportive backdrop for equities and treasuries, helping the major averages reverse course from tests of their 200-day moving averages. The rebound has been particularly notable in the Nasdaq Composite, which has managed to reclaim its 200-day moving average (22,191.85) after briefly trading below that level last week.

Reviewing today's data:

• March Empire State Manufacturing -0.2 (Briefing.com consensus 0.5%); Prior 7.1
• February Industrial Production 0.2% (Briefing.com consensus 0.4%); Prior 0.7%, February Capacity Utilization 76.3% (Briefing.com consensus 76.0%); Prior was revised to 76.3% from 76.2%
  
  • The key takeaway from the report is that it marked the fourth straight monthly increase in industrial production, although that streak masks some otherwise tepid output. At 102.6 percent of its 2017 average, total industrial production was just 1.4% above its year-earlier level.
• March NAHB Housing Market Index 38; Prior was revised to 37 from 36