Midday Comment — Wednesday, December 08, 2021
DJIA: 35,642.21, down 77.22
S&P 500: 4,684.70, down 2.05
Nasdaq Composite: 15,721.97, up 35.05
Stocks mixed; yields higher
U.S. stocks are mixed near mid-session Wednesday as investors weigh mixed pandemic headlines. The Dow is losing 77 points after yesterday capping its largest two-day advance since November 2020 (+3.3%). The S&P 500 is hovering just below the flat line, while the Nasdaq Composite is turning 0.2% higher on the heels of the two benchmarks’ best daily performances since the beginning of March. Helping buoy sentiment, preliminary lab studies indicated a third dose (booster) of Pfizer and BioNTech’s joint COVID-19 vaccine neutralized the newest Omicron coronavirus strain. Tempering optimism, however, is the possibility of renewed virus-related travel curbs in other parts of the world. Across the pond, the U.K. is considering reinstating movement restrictions to slow the spread of the Omicron COVID-19 strain.
U.S. Treasuries are lower, with the yield on the 10-year note up four basis points (0.04%) to 1.52% ahead of this afternoon’s $36 billion auction in this maturity. On the data front, the Jobs Openings and Labor Turnover Survey (JOLTS) showed 11.03 million available positions in October, just below July’s record 11.09 million. Additionally, the quit rate eased after hitting a record in September. In commodities, WTI crude is climbing 0.9% to $72.72/barrel despite data revealing a smaller-than-expected weekly drawdown in domestic crude stockpiles.
In corporate news, Apple is up 2.1% despite being expected to miss its iPhone production goal this year amid supply chain disruptions. In earnings, Stitch Fix is sliding 22.9% following disappointing current-quarter sales guidance. Breadth is positive on issues by 2:1 on the NYSE and 7:3 on the Nasdaq. Composite NYSE volume is greater than 1.8 billion shares.
Opening Comment — Wednesday, December 08, 2021
DJIA: 35,745.66, up 26.23
S&P 500: 4,684.85, down 1.90
Nasdaq Composite: 15,650.89, down 36.03
Stocks fluctuate; yields rise
U.S. stocks are fluctuating in early trading Wednesday as investors continue to weigh mixed pandemic headlines. The Dow is adding 26 points after yesterday capping its largest two-day advance since November 2020 (+3.3%). The S&P 500 is hovering just above the flat line, while the Nasdaq Composite is dipping 0.2% on the heels of the benchmarks’ best daily performances since the beginning of March. Helping buoy sentiment, preliminary lab studies indicated a third dose of Pfizer and BioNTech’s joint COVID-19 vaccine neutralized the newest Omicron coronavirus strain.
The major averages erased overnight gains, however, amid the possibility of renewed virus-related travel curbs in other parts of the world. Across the pond, the U.K. is considering reinstating movement restrictions to slow the spread of the Omicron COVID-19 strain. Treasuries are lower, with the yield on the 10-year note up two basis points (0.02%) to 1.50% ahead of this afternoon’s $36 billion auction in this maturity. In commodities, WTI crude is off 0.4% to $71.80/barrel.
In earnings, Stitch Fix is sliding more than 25% following disappointing current-quarter sales guidance and downbeat membership metrics. Elsewhere, Campbell Soup is rising 3.5% after topping analyst profit estimates. Breadth is positive on issues by 7:4 on the NYSE and roughly even on issues on the Nasdaq.
On the data front, the Jobs Openings and Labor Turnover Survey (JOLTS) showed 11 million available positions in October, compared to the previous 10.6 million figure. The update also revealed the quit rate eased after hitting a record in September.
Closing Comment — Tuesday, December 07, 2021
DJIA: 35,719.43, up 492.40
S&P 500: 4,686.75, up 95.08
Nasdaq: 15,686.92, up 461.77
Stocks log best day since March
U.S. stocks finished firmly higher on Tuesday, with the S&P 500 back within 0.4% of a fresh record level. The Dow climbed 492 points, notching its largest two-day advance since November 2020 (+3.3%). The S&P 500 jumped 2.1%, while the Nasdaq Composite rallied 3%, with both benchmarks logging their best daily performances since the beginning of March amid strength in tech shares. The small-cap Russell 2000 added 1.9%.
Risk appetite was bolstered as Wall Street continued to reevaluate the economic impact of the Omicron coronavirus variant. The new strain appears milder than originally thought, raising hope that consumer demand will remain intact. Also buoying the mood were results of a laboratory study that showed GlaxoSmithKline and Vir Biotechnology’s joint antibody treatment (which blunts more severe disease of COVID-19) was effective against the Omicron variant. Meanwhile, in Washington, Senate leaders negotiated a deal that could raise the debt ceiling as soon as this evening by majority vote.
Mega-cap names Apple and Tesla surged following separate analyst price target increases. Chipmakers were also among the standouts, with the Philadelphia Semiconductor Index soaring 5% for its strongest session in nine months. Elsewhere, AutoZone climbed 7.5% on the heels of positive quarterly results.
Treasuries declined, with the yield curve flattening. The yield on the 10-year note was up four basis points (0.04%) to 1.48%, while the two-year note yield spiked six basis points (0.06%) to 0.69%, the highest level since March 2020. In commodities, WTI crude extended a rebound, adding 2.8% to $71.46/barrel.