Stock Market Update

[BRIEFING.COM] Stocks are mostly higher following yesterday's sell-off that followed a "hawkish pause" on rates from the FOMC, with solid tech leadership pushing the Nasdaq Composite (+1.4%) and S&P 500 (1.0%) firmly higher while the DJIA (+0.3%) holds a more modest gain.

Treasury yields surged in reaction to the Fed's more hawkish tone yesterday, though they have come down somewhat alongside oil prices after President Trump signed a 60-day memorandum of understanding to end the conflict in Iran. As a result, oil- and rate-sensitive stocks and growth stocks are driving the gains at the index level.

The top-weighted information technology sector (+2.4%) holds the widest gain, supported by a rally across semiconductor and other AI-related stocks. The PHLX Semiconductor Index is up 6.2%, with Intel (INTC 133.35, +12.25, +10.12%) a chipmaker standout after President Trump announced the company will partner with Apple (AAPL 297.24, +1.29, +0.44%) to design and manufacture Apple's chips in the U.S.

Elsewhere in the sector, Accenture (ACN 128.15, -27.86, -17.86%) is the worst-performing S&P 500 name after beating earnings expectations but issuing disappointing guidance, which has weighed on other IT services names such as IBM (IBM 249.52, -12.83, -4.89%).

Amazon (AMZN 243.52, +6.02, +2.53%) is generating chipmaking headlines of its own after Bloomberg reported the company is considering selling its Trainium AI chips to external data centers in a push to challenge NVIDIA's (NVDA 210.38, +5.73, +2.80%) dominance. Amazon provides solid leadership for the consumer discretionary sector (+1.5%), which is buoyed by the retreat in oil prices and Treasury yields.

Carvana (CVNA 67.41, +4.55, +7.24%) is the sector's top performer, while cruise lines also post solid gains.

Homebuilders such as PulteGroup (PHM 128.03, +6.15, +5.05%) and Lennar (LEN 90.44, +3.96, +4.58%) are also among the outperformers, contributing to strength in the iShares U.S. Home Construction ETF (+4.5%).

Building-related names such as Builders FirstSource (BLDR 82.22, +6.08, +7.99%) lead strength in the industrials sector (+1.1%), outweighing weakness in aerospace and defense names that follow the improved geopolitical sentiment between the U.S. and Iran.

Meanwhile, the rate-sensitive utilities sector (+1.5%) outperforms despite weakness across other defensive sectors, including health care (-1.0%) and consumer staples (-0.3%).

Outside of the S&P 500, the Russell 2000 (+1.5%) and S&P Mid Cap 400 (+1.0%) also hold solid gains, broadly in line with the major averages.

With just a few hours remaining before tomorrow's holiday closure, the major averages are homing in on solid weekly gains. Stocks have bounced back from yesterday's post-FOMC weakness as easing geopolitical tensions pressure oil prices, while semiconductor names continue to lead the way as investors remain eager to buy recent dips across the sector.

Reviewing today's data:

• Weekly Initial Claims 226K (Briefing.com consensus 226K); Prior was revised to 230K from 229K, Weekly Continuing Claims 1.810 mln; Prior was revised to 1.786 mln from 1.795 mln
  • The key takeaway from the report is the steady level of initial jobless claims—a leading indicator—which suggests the continuation of low firing activity overall.
• June Philadelphia Fed Index 10.3 (Briefing.com consensus 10.0); Prior -0.4
• May Leading Economic Index 0.1% (Briefing.com consensus 0.1%); Prior was revised to 0.2% from 0.1%