Opening Comment — May 22, 2017
S&P 500: 2,381.70
Nasdaq Composite: 6,083.70
Stock index futures are indicating a higher open on Monday. The Dow, S&P 500 and Nasdaq 100 are trading 0.1% above fair value on GLOBEX.
The major averages are poised to advance ahead of commentary from Federal Reserve speakers. On the central bank front, Minneapolis Fed President Neel Kashkari and Fed Governor Lael Brainard are scheduled to speak at the Opportunity & Inclusive Growth Institute Conference. In commodities, NYMEX WTI crude is adding 1.5% to $51.06/barrel amid optimism that OPEC will expend production cuts at their meeting in Vienna this week.
In stock news, Ford is adding 2.1% to $11.09 as the automaker will announce its replaced CEO Mark Fields with former Steelcase chief executive Jim Hackett. Shares of Qualcomm are up 1.7% to $58.65 after being the subject of positive analyst commentary.
European markets are fluctuating near mid-session. The broad Euro STOXX 600 is trading flat as losses in Financials and Technology companies are being offset by gains in the Materials and Energy space. The U.K.’s FTSE 100 is gaining 0.5% after Britain’s Brexit Secretary David Davis said the country will walk away from negotiations unless the European Union drops demands for a divorce payment as high as 100 billion euros ($112 billion). In Asia, Japan’s Nikkei 225 rebounded 0.5% in sympathy with a weaker yen. Chinese equities finished higher with the Hang Seng in Hong Kong climbing 0.9% to hit a 22-month high.
Treasuries are declining with the benchmark 10-year note down 3/32 to yield 2.24%.In FOREX, the Dollar Index is falling 0.2%.
Midday Comment — May 22, 2017
DJIA: 20,877.3, up 72.46
S&P 500: 2,390.19, up 8.46
Nasdaq Composite: 6,119.6, up 35.9
Stocks are advancing near mid-session Monday. The Dow is up 73 points to 20878. The S&P 500 is adding 8 points to 2390 and the Nasdaq Composite is gaining 36 points to 6119.
The major averages remain in positive territory as oil prices climb and President Trump continues his first trip overseas since taking office. President Trump has a two-day visit planned to Israel which comes after he traveled to Saudi Arabia, a trip that ended with a multi-billion-dollar arms deal. In commodities, NYMEX WTI crude is adding 0.5% to $50.56/barrel amid optimism that OPEC will expend production cuts at their meeting in Vienna this week.
Eight of 11 sectors in the S&P 500 are advancing near halftime. Defense stocks are climbing to all-time highs amid the $110 billion U.S.-Saudi Arabia weapons deal. Lockheed Martin is gaining 1.6% to $277.12 while General Dynamics is adding 0.8% to $197.42. Jet maker Boeing is climbing 1.1% to $182.70 amid news it signed deals with Saudi Arabia over the weekend, involving the sale of military and passenger aircraft. In Health Care, Centene is sliding 1.6% to $73.90 after being the subject of negative analyst commentary. Amgen is losing 2.3% to $152.85 amid reports it’s Evinity for osteoporosis revealed a higher rate of serious heart-related side effects.
Breadth is positive on issues by 9-5 on the NYSE and 3-2 on the Nasdaq. Composite NYSE volume is 1.2 billion shares.
Treasuries are declining with the benchmark 10-year note down 2/32 to yield 2.24%. In FOREX, the Dollar Index is falling 0.1%.
Closing Comment — May 19, 2017
DJIA: 20,804.84, up 141.82
S&P 500: 2,381.73, up 16.01
Nasdaq Composite: 6,083.7, up 28.57
Stocks finished higher on Friday. The Dow was up 141 points to 20804. The S&P 500 added 16 points to 2381 and the Nasdaq Composite gained 28 points to 6083.
The major averages advanced on the session as political concerns eased and investors focused on economic and corporate earnings growth. Stocks experienced their biggest sell-off of the year earlier this week as investors weighed President Trump’s chances to deliver on his pro-growth agenda. Rising oil prices were a catalyst in boosting stocks on Friday. NYMEX WTI crude added 1.7% to $50.19/barrel ahead of next week’s OPEC meeting where production cuts are expected to be extended.
All 11 sectors in the S&P 500 ended in positive territory. Technology stocks outperformed with Qualcomm up 2.8% to $57.67. Autodesk advanced 14.7% to $109.91 as the company saw strong increases in subscription numbers this quarter. Elsewhere in earnings, Deere & Co gained 7.3% to $120.90 after the heavy equipment maker reported better-than-expected quarterly profit. McKesson climbed 8.2% to $153.01 amid strong results in pharmaceutical distribution and services. In the consumer space, Foot Locker fell 16.7% to $58.72 as quarterly revenue fell short of Street forecasts. Symantec slid 2.4% to $29.01 after being the subject of negative analyst commentary.
Breadth was positive on issues by 21-5 on the NYSE and 5-3 on the Nasdaq. Composite NYSE volume totaled 3.8 billion shares.
Treasuries declined with the benchmark 10-year note down 3/32 to yield 2.23%. In commodities, COMEX gold gained 0.2% to $1254.80/ounce. In FOREX, the Dollar Index fell 0.7%.
For the week, the Dow was down 0.4%, the S&P 500 lost 0.4%, and the Nasdaq fell 0.6%.
Wells Fargo Investment Institute, Inc. is a registered investment adviser and wholly-owned subsidiary of Wells Fargo & Company and provides investment advice to Wells Fargo Bank, N.A., Wells Fargo Advisors, and other Wells Fargo affiliates. Wells Fargo Bank, N.A. is a bank affiliate of Wells Fargo & Company.