Stocks End Lower To Start The Shortened Trading Week  Image: Bigstock Stocks closed lower yesterday in an uneven day. The large-cap Dow was down -0.56%, while the small-cap Russell 2000 was down a sharp -2.10%, yet the tech-heavy Nasdaq was only down -0.08%. Stocks were under pressure right from the start. They made a comeback mid-morning, but ultimately turned back lower. Motor Vehicle Sales was one of the first reports out of the gate and it came in at 15.0 million units (annualized) vs. last month's 15.7M and views for 15.6M. The North American-Made Sales came in at 11.6M vs. last month's 12.4M. Factory Orders fell -2.1% m/m. That was less than the expected -2.6%, but still down from last month's 2.3% pace. And the Investor Movement Index increased to 5.70 vs. last month's 5.53. Today we'll get MBA Mortgage Applications, the International Trade in Goods and Services report, the PMI Composite report, the ISM Services Index, and the Beige Book report. FYI – yesterday it was announced that Airbnb, and Blackstone will be added to the S&P 500 on September 18, replacing Lincoln National Corp., and Newell Brands. Additionally, Liberty Energy will be added to the small-cap S&P 600 on the same date. In other news, it was announced that Saudi Arabia and Russia will be extending their voluntary oil production cuts for the rest of the year. That continues to keep 1 million barrels a day of Saudi crude off the market for another 4 months, and 300,000 barrels a day of Russian oil off the market. Oil rallied more than a $1 or 1.30% on the news to the highest level since last November. Last week's Employment Situation report was considered supportive for the market as it showed the jobs market cooling a bit, but still strong. And last week's PCE inflation report, which ticked up, but within expectations, was also considered supportive. Currently, the probabilities for a September rate hike have fallen to 7%. (The Fed meets again of the 19th and 20th.) But we'll get two more inflation reports before then with the Consumer Price Index (CPI) on September 13, and the Produce Price Index (PPI) on September 14. As I wrote yesterday, with September now upon us, I'm seeing plenty of articles citing stats that September is typically a weak month. But I recently read that since 1950, if the S&P is up by more than 15% thru August (it was up 17.4% this year), with August being down (which it was), then September is typically up with a median gain of 3.3%, and a win ratio of 86% (6 out of 7 instances). Moreover, if the market is up more than 10% thru July, and August is down, the remainder of the year is up 100% of the time with an average gain of 9.9% (median of 8.7%). Interesting stats to take note of. Granted, September is off to a slow start, but there's plenty of month left, and plenty of year left to go. And the statistical trends are definitely on the bull's side. See you tomorrow,  Kevin Matras
Executive Vice President, Zacks Investment Research | 
Post a Comment
Post a Comment