GoGrowth Stocks Showed Weakness On Above Average Trade …
GoGrowth Stocks Showed Weakness On Above Average Trade
Posted by: : Paul EbelingPosted on: July 16, 2014GoGrowth Stocks Showed Weakness On Above Average Trade
IBB, GS, JPM, LO, RAI, FB, MCO, TWTR, YELP, JBHT
DJIA +2.9% YTD , S&P 500 +6.8% YTD, NAS 100 +5.7% YTD , Russell 2000 -0.8% YTD
DJIA +5.26 at 17060.68, NAS 100 -24.03 at 4416.39, S&P 100 -3.82 at 1973.28
Volume: trade was above average at 716-M/shrs changing hands on the NYSE.
Small caps showed weakness on the session resulting in the NAS 100 (-0.5%) and Russell 2000 (-1.0%) finishing behind the S&P 500 (-0.2%) and the DJIA (+0.03%).
Better than expected earnings came from Goldman Sachs (NYSE:GS) 169.17, +2.17, and JPMorgan Chase (NYSE:JPM) 58.27, +1.98. The 2 influential Wall Street banks gained 1.3% and 3.5%, respectively, their strength was not enough to keep the S&P 500 out of the Red.
Late morning remarks from Fed Chairwoman Janet Yellen’s to the Senate on monetary policy singled out biotechnology and social media stocks, aka GoGrowth, as groups that have had their valuations stretched, such stocks from both responded by leading the charge South.
The iShares Nasdaq Biotechnology ETF (NYSEArca:IBB) 252.43, -5.67 lost 2.2%, putting the ETF back near its low of the month, the healthcare sector (-0.9%) was the weakest performing group.
Consumer staples finished lower on the day.
The sector lost 0.8% with tobacco names exerting pressure as Lorillard (NYSE:LO) 60.17, -7.05 fell 10.5% after agreeing to be acquired by Reynolds American (NYSE:RAI) 58.84, -4.34 for 68.88/share. The deal announcement was followed by news that Moody’s (NYSE:MCO) is reviewing ratings of both names for downgrades.
The telecom services sector rose 0.7%, and utilities added 0.5%.
Financials stayed in the Green all day.
The industrial sector (+0.1%) moved to positive territory in the afternoon. Transports contributed to the recovery.
Dow Jones Transportation Average +0.4%)with JB Hunt (NASDAQ:JBHT) 76.94, +2.65 leading. The stock rallied 3.6% after reporting in-line results.
Technology (-0.2%) underperformed intra-day, but caught up to the S&P 500 into the close.
Social media names lagged, but pared some of their losses. Facebook (NASDAQ:FB) 67.16, -0.73, Twitter (NYSE:TWTR) 37.88, -0.43), and Yelp (NYSE:YELP) 69.02, -2.0 lost between 1.1% and 2.9%.
US Treasuries ended little changed after alternating between gains and losses. The 10-yr yield finished the day at 2.55%.
Economic data included June Retail Sales, June import/export prices, July Empire Manufacturing survey, and the Empire Manufacturing Survey:
Retail sales increased 0.2% in June following an upwardly revised 0.5% (from 0.3%) increase in May, the consensus expected an increase of 0.7%
Export prices, excluding agri, fell 0.3% in June after increasing 0.1% in the past reading
Excluding Crude Oil, import prices declined 0.1%, which followed last month’s unchanged reading
The Empire Manufacturing Survey for July registered a reading of 25.6, which was well ahead of the prior month’s reading of 19.3. It was also ahead of the consensus estimate, which was pegged at 13.2
Business inventories increased 0.5% in May following an unrevised 0.6% increase in April, the consensus expected business inventories to increase 0.6%.
Wednesday, the weekly MBA Mortgage Index will be released at 7:00a EDT, while June PPI (consensus 0.2%) will be reported at 8:30a EDT. The Net Long-Term TIC Flows report for May will cross the wire at 9:00a EDT, June Industrial Production (consensus 0.4%) and Capacity Utilization (expected 79.2%) will both at 9:15a EDT. The data includes the 10:00a ET release of the NAHB Housing Market Index for July (consensus 50) and the July Fed’s Beige Book, which will be released at 02:00p EDT.
Stay tuned…
HeffX-LTN
Paul Ebeling
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Paul Ebeling is best known for his work as writer and publisher of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly-regarded, weekly financial market letter, where he enjoys an international audience among opinion makers, business leaders, and respected organizations. Something of a pioneer in online stock market and commodities discussion and analysis, Ebeling has been online since 1994. He has studied and worked in the global financial and stock markets since 1984.
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GoGrowth Stocks Showed Weakness On Above Average Trade …
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