Stocks traded higher at the open today and then advanced higher on better than expected consumer confidence data. September Consumer Confidence came in at 70.3 versus a consensus estimate of 63.0. Last month the reading was 60.6. Stocks topped out and reversed and fell to negative territory midway through the trading day. Weakness in energy and the euro led to more selling. Financials, materials, industrials and technology sold off the most sharply.
Today was the worst one day selloff in the market since June 28. The S&P 500 has now been down four days in a row. Locking in gains as we end the third quarter was mentioned as a reason for the sell off today on many trading desks. Selling intensified when a Fed member commented that he did not believe that recent easing would be effective.
Health care stocks were an area of strength. Large cap pharmaceutical stocks remain leaders in the market. Tech stocks sold off today. Apple has sold off this week and moved back to the level where it broke out earlier in the month.
U.S. home prices continued higher in July. More good news from the housing market as house price indexes again showed gains. The Case-Shiller 20-city composite index increased 0.4% in July. In the last three months the composite has increased 10.0% on a seasonally adjusted annual rate.
The better than expected consumer confidence numbers did not have a positive impact on the industrial sector. Caterpillar reduced forward guidance. They decreased earnings targets for 2015.
The housing sector sold off on profit taking today. News flow on the sector was positive. The area had been a market leader for several weeks and saw a reversal intraday today.
Source: PFS Group
