THE GIST (“THE WHAT”)
Interest rate sensitive mega-cap stocks were sold-off ahead of crucial inflation data, sending the broader market lower. Selling intensified during the last hour of the rollercoaster session. The S&P 500 index closed the session near day’s lows at 4467.71, down 31.67 points (-0.70%).
Note: Our daily “S&P 500 Trading plan” will be posted around 9:30/10:00am EDT, every trading day.
Trading Plans for WED. 08/09: Markets Searching for a Direction – Day 2
For the last published Results of the Morning Trading Plans, please click here
THE DETAILS (The “How & Why”):
July’s consumer price data is expected to accelerate slightly year-over-year to 3.3%, above the 3% in the prior month. Bond yields moved lower, with the 10-year Treasury yield settling lower by 1.6 basis point at 4.006%.
Interest rate sensitive technology and chip stocks were sold-off broadly ahead of the keenly awaited CPI data as investors look for clues on Fed’s next interest rate moves. NVIDIA Corp was the worst decliner of the session, falling 4.72%. Broadcom, Marvel Technology, Advanced Micro Devices, and ON Semiconductor all closed more than 2% lower. Tesla shed 3% and Meta pulled back 2.4%.
Regional bank stocks extended their slide for the second day following credit rating agency Moody’s cutting ratings of ten small and midsized banks while adopting a negative outlook for few large banks. KeyCorp, Lincoln National and M&T Banks all shed more than 3%. Truist Financial, Zions Bankcorp and PNC Financial Services Group also fell more than 2% each.
On the bright side, oil prices jumped more than 1% to a near 8-month high amid supply concerns, sending energy stocks higher. APA Corp rose 2%. Marathon Oil, Exxon Mobil, Haliburton, Hess Corp, and Valero Energy are closed higher by more than 1%.
On the earnings front, Axon Enterprise was the strongest performer of the session, soaring 14% on reporting stronger-than-expecting net sales of $374.6 million. Akamai Technologies and FleetCor Technologies were other strong gainers of today’s session on beating second quarter earnings estimates.