The major averages closed lower today with the Dow off 0.28% and the S&P 500 lower by 0.50%. Trading was light and the market was near the flat line for the majority of the day before sellers took over in the final hour of trading.
Nine of the ten sectors in the S&P 500 finished lower today. The technology sector was the only area that traded higher today. Cisco Systems reported earnings after the close yesterday and roared higher today. Cisco closed higher by 12.62%. Apple bucked the recent trend and was higher by 1.4%. Tech leader IBM also traded higher.
Housing starts fell by 16.5% in April to 853,000 in March. This was the lowest number of housing starts since November of 2012. The consensus estimate called for 970,000. Homebuilders lagged on the release of the data and fell 1.7%. Retailers were off after Wal-Mart issued weaker than expected guidance. WMT closed lower by 1.7%. The stock did break out to a new high yesterday so the pull back today was orderly profit taking.
The May Philadelphia Fed’s Business outlook showed that manufacturing activity in the Philadelphia region contracted significantly in May. The reading came in at -5.2 against a consensus estimate of 2.5.
Biotech stocks rallied ahead of the ASO meeting. Data began to be released today and the stocks sold off. There were not any negative data points; it was just a case of buying the rumor and selling the fact. Investors used the recent run in the area to take some profits today.
Energy stocks were in line with the market. Crude closed down by 1% and natural gas sold off sharply losing 3.25%. Natural gas sold off after inventory data released today showed a larger than expected build in inventory.
Consumer discretionary stocks trailed the consumer staples sector. Wal-Mart put retail under pressure. Kohl’s bucked then trend and was higher by 4.6% on better than expected earnings. Beer stocks rose on analyst upgrades and staple favorites like Coca-Cola and Kraft rose in the down tape.
Source: PFS Group
