Historical Stock Chart
6 Months : From Aug 2019 to Feb 2020
By Chris Matthews and William Watts, MarketWatch
Apple rolls out new iPhones, iPad and Watch
U.S. stocks traded lower Tuesday, as a selloff in momentum-driven technology shares overshadowed a rally in energy and industrials stocks, and as investors looked ahead to central-bank policy meetings and gauge developments on the U.S.-China trade front.
Apple Inc. (AAPL) was in the spotlight as it announced new model iPhones and other products at its annual launch event Tuesday afternoon.
How are the major benchmarks faring?
The Dow Jones Industrial Average fell 38 points, or less than 0.1%, to 26,800, while the S&P 500 index lost 12 points, or 0.4%, to 2,966. The Nasdaq Composite index retreated 43 points, or 0.5%, to 8,045.
Stocks ended mostly lower in lackluster trade Monday, with the S&P 500 giving up just 0.28 point to end at 2,978.43, ending a three-day win streak. The Dow , however, ended with a gain of 38.05 points, or 0.1%, at 26,835.51, to extend its winning streak to four session. The Nasdaq Composite gave up 15.64 points, or 0.2%, to close at 8,087.44.
Stocks have been in rebound mode in September, however, after suffering their second losing month of 2019 in August. The S&P 500 is up 1.1% so far this month, while the Dow has gained 1.3% and he Nasdaq is up 0.7%.
What's driving the market?
Investors were eyeing a potential rotation in market leadership from defensive names and fast-growing tech stocks into cyclical sectors, including energy, industrials and materials, all of which have posted gains Tuesday, in contrast with the S&P 500.
"The big story is the continuing rotation that we saw begin a couple days ago," Willie Delwhich, market strategist with R.W. Baird told MarketWatch. "If we can actually move away from narrow, defensive leadership into cyclical and small-cap leadership, that would be a healthy development for the market."
Defensive sectors, including real estate, utilities and consumer staples have all helped drag the major indexes lower Tuesday while small capitalization stocks, as measured by the Russell 2000 , posted gains. The share of stocks advancing on Tuesday was at a better than 3 to 2 ratio, a potentially bullish signal going forward, Delwhich said.
Read more: Energy, financial stocks soar: Oversold bounce or the beginning of a break out? (http://www.marketwatch.com/story/energy-financial-stocks-soar-oversold-bounce-or-the-beginning-of-a-break-out-2019-09-10)
But Information technology shares were under pressure Tuesday, down 1.1%, one day after the attorneys general of 50 U.S. states announced an investigation into Google's 'potential monopolistic behavior' (http://www.marketwatch.com/story/google-to-be-investigated-for-possible-antitrust-violations-2019-09-09) on Monday, underscoring regulatory concerns surrounding large tech firms.
Shares of Facebook Inc. (FB), Amazon.com Inc. (AMZN), Netflix Inc. (NFLX) and Google parent Alphabet Inc. (GOOGL) (GOOGL) all lost ground Tuesday amid a broader sell off momentum-driven growth stocks, as indicated by the 2% decline in the iShares Edge MSCI USA Momentum Factor exchange-traded fund (MTUM) .
"The risk is that we get half-way through this rotation, stall out and are left with no momentum anywhere," Delwhich said.
Meanwhile, concerns about the U.S.-China trade battle appear to have moved to the back burner for investors after being blamed for volatile market action in August.
China has reportedly offered to buy more American agricultural products in exchange for a delay in upcoming tariffs and the easing of a ban against doing business with Chinese telecommunications giant Huawei Technologies, according to the South China Morning Post (https://www.scmp.com/news/china/diplomacy/article/3026585/countdown-trade-war-talks-china-ready-sweeten-deal-buying). The report comes on the heels of comments by U.S. Treasury Secretary Steven Mnuchin, who told Fox Business Network Monday that he views renewed discussions with Beijing as a sign of good faith.
"The U.S. and China are due to meet next month, and according to Steven Mnuchin...the U.S. is prepared to do a deal, as long as it is good for the U.S.," said David Madden, market analyst at CMC Markets UK, in a note. "The lack of hostilities between the U.S. and China is likely to keep stocks in their upward move.
The European Central Bank is expected to deliver additional monetary stimulus when its policy makers meet Thursday, though some officials have appeared to push back (https://www.wsj.com/articles/mario-draghis-plan-for-final-jolt-of-stimulus-runs-into-opposition-11568107800?mod=hp_lead_pos3) against expectations for an aggressive package of measures combining further interest-rate cuts with a new bond-buying program.
Read: The ECB's challenge: Pushing rates further into negative territory without wrecking eurozone banks (http://www.marketwatch.com/story/the-ecbs-challenge-pushing-rates-further-into-negative-territory-without-wrecking-eurozone-banks-2019-09-10)
The U.S. National Federation of Independent Business on Tuesday said its small-business optimism index fell 1.6 points to a seasonally adjusted 103.1 in August (http://www.marketwatch.com/story/nfib-small-business-optimism-index-falls-in-august-to-a-five-month-low-2019-09-10), its worst showing since March.
The rate at which Americans quit their jobs hit an all-time high in July, the Labor Department estimated (http://www.marketwatch.com/story/job-openings-dip-in-july-as-demand-for-workers-slows-but-high-quit-rate-shows-labor-market-still-strong-2019-09-10) Tuesday, suggesting that workers are confident in the strength of the job market. Job openings fell slightly during the month, while layoffs remained at low levels.
Which stocks are in focus?
Investors were watching shares of Apple(AAPL) after it held its annual fall roll-out event, where it introduced a new TV streaming service that will cost $4.99 a month and be free for a year to purchasers of new iPhone, iPad or Mac products. It also introduced a new videogame service and a suite of new smartphones: the iPhone 11, iPhone 11 Pro and the iPhone 11 Max. Netflix (NFLX) extended its losses to fall 3.2% after news of the streaming service, while Apple shares rose 0.2%.
See:Apple iPhone launch event -- 5 things to watch for (http://www.marketwatch.com/story/apple-iphone-launch-event-5-things-to-watch-for-2019-09-06)
Shares of Ford Motor Co.(F) were down 2.1% Tuesday. Credit rating agency Moody's Investors Service late Monday downgraded the auto maker's debt rating (http://www.marketwatch.com/story/fords-debt-rating-gets-downgraded-to-junk-by-moodys-2019-09-09) to Ba1, the first rung of "junk," or non-investment speculative grade, from Baa3, citing "considerable operating and market challenges" and predicted "weak earnings and cash generation likely as the company pursues a lengthy and costly restructuring plan." S&P Global Ratings and Fitch Ratings have a BBB rating on Ford, which is two steps above junk, though have a negative outlook. As long as the company has two ratings above junk, it is eligible to stay in the biggest investment-grade bond indexes.
Shares of HD Supply Holdings Inc.(HDS) were down 4.8% after the industrial distribution company reported a fiscal second-quarter profit that topped expectations but sales that missed (http://www.marketwatch.com/story/hd-supplys-stock-set-to-fall-after-profit-beat-but-sales-outlook-disappoint-2019-09-10), while also providing a downbeat outlook for the current quarter.
Shares in fast food retailer Wendy's Co. (WEN) fell 10.7% after announcing a $20 million plan to serve breakfast nationwide (http://www.marketwatch.com/story/wendys-jumping-back-into-breakfast-armed-with-bacon-strength-2019-09-10) from 2020.
How are other markets trading?
The yield on the 10-year U.S. Treasury note rose to 1.69%.
Stocks traded mixed in Asia overnight, with the China CSI 300 falling 0.3%, Hong Kong's Hang Seng index nearly unchanged and Japan's Nikkei 225 rising 0.4%. In Europe, closed mostly higher, with the Stoxx Europe advancing 0.1%
In commodities markets, the price of crude oil was down 0.4% to $57.65 after bearish EIA forecasts and ahead of an OPEC meeting on Thursday (http://www.marketwatch.com/story/oil-aims-for-5-day-win-streak-on-optimism-over-production-curbs-2019-09-10). (http://www.marketwatch.com/story/oil-aims-for-5-day-win-streak-on-optimism-over-production-curbs-2019-09-10)
The price of gold fell 0.7% to about $1,501 an ounce. The U.S. dollar , meanwhile, edged higher against a basket of its peers.
(END) Dow Jones Newswires
September 10, 2019 15:23 ET (19:23 GMT)
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