Stock Market Update

[BRIEFING.COM] The S&P 500 (+0.3%) and Nasdaq Composite (+0.9%) started May on a high note as strength in mega-cap and tech names propelled the indices to fresh record highs, while the DJIA (-0.3%) lagged amid weakness in the broader market.

Only two S&P 500 sectors finished in positive territory, though the top-weighted information technology sector's (+1.4%) gain was wide enough to prompt index-level growth.

Apple (AAPL 280.14, +8.79, +3.24%) kept momentum rolling across mega-cap tech after topping earnings estimates and providing upside guidance for the next quarter, while Microsoft (MSFT 414.20, +6.42, +1.57%) recovered some of yesterday's post-earnings weakness.

Though not a component of the S&P 500, Atlassian (TEAM 88.88, +20.29, +29.58%) was another notable earnings standout, and the iShares GS Software ETF finished 3.2% higher.

The PHLX Semiconductor Index (+0.9%) also finished higher amid a busy week for memory storage names. Sandisk (SNDK 1187.00, +90.49, +8.25%) moved sharply higher after earnings while Western Digital (WDC 431.52, -3.00, -0.69%) faced some sell-the-news pressure, and Seagate Tech (STX 726.93, +53.29, +7.91%) extended yesterday's massive rally.

The consumer discretionary sector (+0.5%) was the only other sector to finish with a gain, supported by strength in its mega-cap components Tesla (TSLA 390.82, +9.19, +2.41%) and Amazon (AMZN 268.26, +3.20, +1.21%).

The Vanguard Mega Cap Growth ETF finished 0.9% higher, helping the market-weighted S&P 500 (+0.3%) outperform the S&P 500 Equal Weighted Index (-0.3%).

Elsewhere in the sector, cruise lines and courier names outperformed as oil prices retreated today, with crude oil futures settling today's session $3.31 lower (-3.2%) at $101.84 per barrel.

The energy sector (-1.3%) was the worst-performing S&P 500 sector as a result.

The industrials sector (-0.9%) also underperformed after yesterday's sharp gain that followed CAT's earnings release, though airline names such as United Airlines (UAL 92.52, +2.52, +2.80%) and Southwest Air (LUV 38.76, +0.84, +2.22%) traded higher amid the retreat in oil prices and reports that Spirit Airlines is preparing to shut down operations.

Losses across the other S&P 500 sectors were modest in nature as the market ended the week in a relatively quiet fashion after a record-setting week.

Still, strong mega-cap and tech leadership, which was largely a product of impressive earnings growth, has the S&P 500 and Nasdaq Composite pushing further into record territory to start the month of May.

U.S. Treasuries started May on a quiet note, largely thanks to Labor Day closures that significantly reduced the participation of international investors on Friday. The 2-year note yield settled up one basis point to 3.89% (+11 basis points this week), and the 10-year note yield settled down one basis point to 4.38% (+7 basis points this week).

• Russell 2000: +13.3% YTD
• S&P Mid Cap 400: +10.1% YTD
• Nasdaq Composite: +8.1% YTD
• S&P 500: +5.6% YTD
• DJIA: +3.0% YTD

Reviewing today's data:

• April S&P Global U.S. Manufacturing PMI - Final 54.5; Prior 54.0
• April ISM Manufacturing Index 52.7% (Briefing.com consensus 53.1%); Prior 52.7%
  • The key takeaway from the report is that it had some stagflation aspects for the manufacturing sector, namely low growth, a further contraction in employment, and a stark increase in the prices index, which has risen 25.6 percentage points in the last three months.