Stock Market News for July 03, 2014 – July 3, 2014 – Zacks.com

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Benchmarks ended Wednesday’s listless trading session little changed despite upbeat private sector hiring numbers. Investors refrained from betting ahead of the nonfarm payroll data for June that is scheduled for release on Thursday. Investors also kept an eye on Federal Reserve Chairwoman Janet Yellen’s comments on financial stability.

For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article

The Dow Jones Industrial Average (DJI) gained 0.1% to close Wednesday’s trading session at 16,976.24. The Standard & Poor 500 (S&P 500) advanced almost 0.1% to finish at 1,974.62. However, the tech-laden Nasdaq Composite Index dropped a meager 0.02% and closed yesterday’s session at 4,457.73. The fear-gauge CBOE Volatility Index (VIX) dropped almost 3.0% to settle at 10.82. Total volume for the day was roughly 4.79 billion shares, lower than this month’s average of 6.15 billion. Decliners outpaced advancing stocks on the NYSE. For 60% stocks that declined, 36% advanced.

The S&P 500’s movement of 0.21% between the highest and the lowest points during the trading session turned out to be the second narrowest fluctuation since 1993. The Dow traded in the narrowest range this year. However, the meager gains helped benchmarks extend their record highs. The blue-chip index and the S&P 500 closed at a record level for the second straight day. The Dow closed at a record level for the thirteenth time this year. The S&P 500 ended at another high; the twenty-fourth one this year.

Encouraging private-sector hiring numbers hardly impacted the markets yesterday. The national employment report from Automatic Data Processing, Inc. (NASDAQ:ADP) showed private sector hiring improved in June. The report stated 281,000 private jobs were added in June. This was higher than expectations of 208,000 job additions. The figure was more than May’s unrevised figure of 179,000. June’s job additions were also the most since November 2012.

The strong ADP report on private-sector hiring came in a day ahead of the U.S. Bureau of Labor Statistics’ nonfarm payroll data for June. Total non-farm payroll accounts for approximately 80% of the workers who produce the entire GDP of the United States. Analysts are expecting an addition of 213,000 nonfarm payroll jobs. However, they believe the unemployment rate will remain unchanged at 6.3%.

Separately, according to the U.S. Department of Commerce, new orders for manufactured goods decreased 0.5% in May. This was more than the consensus estimate of a decrease by 0.3%. This reading follows April’s revised increase of 0.8%. Excluding transportation, new orders decreased 0.1% in May. Separately, unfilled orders, shipments and inventories data were up 0.6%, 0.1% and 0.8%, respectively.

Separately, at the International Monetary Fund in Washington, Yellen said: “Monetary policy faces significant limitations as a tool to promote financial stability”. She added: “Its effects on financial vulnerabilities, such as excessive leverage and maturity transformation, are not well understood and are less direct than a regulatory or supervisory approach”. She stated that concerns over financial stability shouldn’t lead to a change in current monetary policy.

Last month, the Federal Reserve kept its monetary policy “highly accommodative” and suggested there would be no immediate rate hikes. Yellen added that the central bank will consider a “wide range of indicators” for deciding rate hikes. She added there “is no mechanical formula” to help Fed decide on raising rates.

Among individual stocks, Constellation Brands Inc. (NYSE:STZ) was one of the S&P 500’s biggest percentage gainers. Shares of the distributor of Corona beer and Svedka vodka went up 2.3% after the company reported better-than-expected earnings for the first quarter of fiscal 2015. Driven by the acquisition of Crown Imports business last year, adjusted earnings for the first quarter of fiscal 2015 jumped nearly threefold to $1.07 per share from 38 cents posted in the comparable year-ago quarter. Quarterly earnings outpaced the Zacks Consensus Estimate of 92 cents per share.

Airline stocks posted the biggest losses among the S&P 500 components. Shares of U.S. airline companies such as Delta Air Lines Inc. (NYSE:DAL), United Continental Holdings, Inc. (NYSE:UAL), American Airlines Group Inc. (NASDAQ:AAL) and The Boeing Company (NYSE:BA) declined 5.1%, 7.1%, 4.4% and 0.4%, respectively.

The Nasdaq ended in negative territory after momentum stocks showed signs of weakness. High-growth stocks such as Facebook, Inc. (NASDAQ:FB), Netflix, Inc. (NASDAQ:NFLX), The Priceline Group Inc. (NASDAQ:PCLN) and Tesla Motors, Inc. (NASDAQ:TSLA) dropped 2.4%, 1.3%, 0.7% and 4.3%, respectively.

Bio-tech stocks advanced yesterday and key stocks including Gilead Sciences Inc. (NASDAQ:GILD), Vertex Pharmaceuticals Incorporated (NASDAQ:VRTX) Amgen Inc. (NASDAQ:AMGN), Biogen Idec Inc. (NASDAQ:BIIB), Celgene Corporation (NASDAQ:CELG) and Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN) increased 2.1%, 2.3%, 0.6%, 1.9%, 1.8% and 1.7%, respectively. The Health Care Select Sector SPDR (XLV) gained almost 0.8%, the highest among the S&P 500 sectors.

On the other hand, the utilities sector suffered its biggest one-day percentage decline since May 2. The sector declined 1.9%. Key stocks from the sector such as Duke Energy Corporation (NYSE:DUK), NextEra Energy, Inc. (NYSE:NEE), Dominion Resources, Inc. (NYSE:D), Southern Company (NYSE:SO), Exelon Corporation (NYSE:EXC) decreased 1.9%, 1.7%, 2.1%, 1.8% and 3.1%, respectively. Overall, 5 out of 10 sectors of the S&P 500 ended in the green.

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Zacks Equity Research