Yahoo Finance Stock Market News for Oct 16, 2023
U.S. stock markets closed mixed on Friday following mixed economic data and a spike in crude oil prices. Market participants remained watchful about the development of ongoing geopolitical conflict between Israel and Hamas. The Dow ended in positive territory, while both the S&P 500 and the Nasdaq Composite finished in negative zone. For the weak, the Dow and the S&P 500 closed in green, while the Nasdaq Composite ended in red.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) rose 0.1% to close at 33,670.29. Notably, 12 components of the 30-stock index ended in positive territory, while 17 ended in negative territory and one remained unchanged. At its intraday high, the blue-chip index was up nearly 225 points.
The tech-heavy Nasdaq Composite finished at 13,407.23, tumbling 1.2% or 167 points due to weak performance of large-cap technology stocks. The major loser of the index was The Trade Desk Inc. TTD. Shares of the company plummeted 5%. The Trade Desk currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The S&P 500 fell 0.5% to end at 4,327.78. 5 out of11 broad sectors of the benchmark ended in positive territory while six in negative zone. The Communication Services Select Sector SPDR (XLC), the Consumer Discretionary Select Sector SPDR (XLY) and the Technology Select Sector SPDR (XLK) fell 1.1%, 1.5% and 1.4%, respectively. On the other hand, the Utilities Select Sector SPDR (XLU) and the Energy Select Sector SPDR (XLE) rose .1% and 2.2%, respectively.
The fear-gauge CBOE Volatility Index (VIX) was up 15.8% to 19.32. A total of 10.06 billion shares were traded on Friday, lower than the last 20-session average of 10.37 billion. Decliners outnumbered advancers on the NYSE by a 1.56-to-1 ratio. On Nasdaq, a 1.68-to-1 ratio favored declining issues.
Consumer Sentiment Declines
The University of Michigan reported that the preliminary reading of the consumer sentiment index for the month of October fell to 63 from 68.1 in September. The index for current economic conditions dropped to 66.7 in October from 71.4 in the prior month. The index for consumer expectations slid to 60.7 in October from 66 in last month.
Expectations for one-year inflation rate rose to 3.8% in October from 3.2% in September, marking its highest reading since May. Long-run inflation expectations edged up from 2.8% last month to 3.0% in October.
Spike in Crude Oil Prices
Ongoing geopolitical conflict between Israel and Palestine-based terrorist group Hamas resulted in a surge in crude oil prices as market participants remained concerned that further escalation of the war may disrupt global oil supply.
The U.S. benchmark – the West Texas Intermediate crude futures for November delivery jumped 5.8% to settle at $87.7 per barrel, marking its best day since April 3. The global benchmark – the Brent crude for December expiry - climbed 5.7% to $90.89 per barrel. The WTI crude advanced more than 4%, last week, reflecting its best week since Sep 1.
Decline in Yields of U.S. Government Bonds
Ongoing geopolitical conflict in the Middle East compelled investors to shift from risky assets like equities to safe-haven government bonds. Consequently, the yield on the benchmark 10-Year U.S. Treasury Note fell to 4.62% from its recent high of 4.84%. Similarly, the yield on the short-term 2-Year U.S. Treasury Note dropped to 5.05% from its recent high of 5.14%.
Weekly Roundup
Last week too was a mixed one for Wall Street. The S&P 500 and the Dow climbed 0.5% and 0.8%, respectively. However, the Nasdaq Composite was down 0.2%. Higher crude oil prices will increase transportation costs, which in turn will raise the general price level. This will make the Fed’s task tougher to control inflation. Continuation of a higher interest rate regime is detrimental to growth sectors like technology. For that, the tech-laden index declined last week.
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