Wall Street was mixed for the second straight session with small caps and Tech showing strength while trading to fresh, intraday all-time highs — and more in Tuesday’s stock market update.
Economic news was also mixed and weighed on sentiment as volume remained light during the holiday-shortened week.
The Russell 2000 rallied 1% after tapping a lifetime high of 1,992 shortly after the opening bell.
The Nasdaq rose 0.5% with the morning record peak reaching 12,840.
The Dow was down 0.7% following the late-day fade to 29,992.
The S&P 500 gave back 0.2% with the midday low testing 3,676.
Technology and Real Estate were the only sectors that closed higher after advancing 0.9% and 0.7%, respectively. Energy and Financials were the weakest sectors after falling 1.7% and 1%.
Apple Inc. (Nasdaq: AAPL) shares were up nearly 3% following news the company is moving forward with its self-driving car technology, aiming to launch a passenger vehicle in 2024 that would include its own battery tech.
Apple’s automotive efforts, known as “Project Titan,” have proceeded unevenly since 2014 when it first started to design its own vehicle from scratch. Central to Apple’s strategy is a new battery design that could “radically” reduce the cost of batteries and increase the vehicle’s range.
In terms of a manufacturing partner, Magna seems best positioned, and the report mentions prior Apple-Magna talks. While this could be viewed as a positive headline for Magna, some Wall Street analysts won’t be surprised if traditional automakers also seek to partner with Apple where excess capacity is available.
The earnings calendar is light this holiday-shortened week with only a handful of notable numbers announcements. The schedule will remain light into the New Year and the second week of January as companies prepare to report fourth-quarter results.
Paychex Inc. (Nasdaq: PAYX) is the only major company announcing numbers Wednesday ahead of the opening bell. Wall Street is expecting a profit of 66 cents a share on revenue of $954 million. The high estimate is at 69 cents a share with the low forecast at 63 cents a share, equating to a three-cent beat or miss.
The company has topped forecasts the past four quarters by eight cents, a penny and two cents twice. There are 19 analysts that cover the stock with one Strong Buy rating, 14 Hold, two Underperform and two Sell ratings.
European markets closed higher across the board following news the European Union is mounting a last-ditch effort in a bid to strike a Brexit trade deal with Britain.
France’s CAC 40 rallied 1.4% and Germany’s DAX 30 jumped 1.3%. The Stoxx 600 rallied 1.2% and the Belgium20 bounced 1.1%. UK’s FTSE 100 gained 0.6%.
Asian markets settled lower across the board.
China’s Shanghai stumbled 1.9% and South Korea’s Kospi sank 1.6%. Australia’s S&P/ASX 200 was off 1.1% and Japan’s Nikkei declined 1%. Hong Kong’s Hang Seng fell 0.7%.
Third-quarter GDP was revised up to 33.4%, versus forecasts of 33.1%, and a -31.4% print in the second-quarter. The GDP chain price index was bumped down to a 3.5% pace from Q2’s -1.8% reading while the core rate also cooled to 3.4% from 3.5% in the prior report and -0.8% previously.
The iShares 20+ Year Treasury Bond ETF (Nasdaq: TLT) was up for the second straight session with the intraday peak reaching $157.83. Prior and lower resistance at $157.50-$158 was recovered. A close above the latter and the 50-day moving average would suggest additional strength towards $159-$159.50.
Rising support is at $157-$156.50 with a move below $156 suggesting a near-term top.
The iPath S&P Vix Short-Term Futures (NYSEArca: VIX) was down for the fifth time in six sessions with the intraday low tapping 23.53. Current and upper support at 24-23.50 was triggered but held. A close below the latter would indicate a retest towards 22.50-22.
Lowered resistance is 25.50-26 and the 50-day moving average.
The SPDR S&P 500 ETF (NYSE: SPY) extended its losing streak to three sessions with the midday low reaching $366.03. Near-term and upper support at $366.50-$366 was breached but held. A close below the latter would suggest further weakness towards $365-$364.50.
Resistance is at $368-$368.50 followed by $369.50-$370.
RSI remains in a downtrend after failing to hold key support at 60. Continued closes below 60 would signal a retest towards 55-50 and levels from early November. Resistance is at 65-70.
The Consumer Discretionary Select SPDR (NYSEArca: XLY) was also down for the third straight session with the intraday low tagging $155.83. Current and upper support at $156-$155.50 was breached but held. A close below the latter would likely indicate a further backtest towards $154.50-$154 and the 50-day moving average.
Resistance is at $158-$158.50 followed by $159.50-$160.
RSI remains in a downtrend with key support at 50 holding. A move below this level would suggest additional weakness towards 45-40. Resistance is at 55-60.
Check back after the closing bell for the most important news and numbers in the WealthPress stock market update.