Stock Market Update

[BRIEFING.COM] The stock market is sinking at this point in the session. The major indices had been trading around their prior closing levels, but turned lower in recent action and hit fresh intraday lows.

The recent deterioration coincided with some mega cap names either pulling back from opening levels or turning negative on the session. Microsoft (MSFT 414.59, -2.54, -0.6%) and Broadcom (AVGO 170.07, -0.59, -0.4%) are standouts in that respect. 

Even NVIDIA (NVDA 121.74, +2.89, +2.4%), which had been up as much as 4.6% after CEO Jensen Huang told CNBC in an interview after yesterday's close that demand for Blackwell is "insane," pulled back from its best level of the day.

Market breadth has been negative throughout the session. Decliners lead advancers by a better than 2-to-1 margin at both the NYSE and Nasdaq.

The overall negative bias stems from hesitation ahead of Friday's employment report, along with geopolitical worries, which have also driven oil prices higher ($73.69, +3.58, +5.1%). 

The S&P 500 energy sector has benefitted from the move in oil, jumping 1.3%. It's the only sector trading higher while five sectors trade down at least 1.0%. 

Reviewing today's economic data:

• Weekly Initial Claims 225K (Briefing.com consensus 223K); Prior was revised to 219K from 218K, Weekly Continuing Claims 1.826 mln; Prior was revised to 1.827 mln from 1.834 mln
  • The key takeaway from the report is that initial jobless claims, a leading indicator, remain well below recession-like levels (the average of initial claims for the last five recessions, excluding the COVID recession, was 458,000), imparting an encouraging understanding that the labor market might be bending but it isn't breaking.
• September S&P Global US Services PMI - Final 55.2; Prior 55.7
• August Factory Orders -0.2% (Briefing.com consensus 0.1%); Prior was revised to 4.9% from 5.0%
  • The key takeaway from the report is that business spending rebounded in August.
• September ISM Non-Manufacturing Index 54.9% (Briefing.com consensus 51.6%); Prior 51.5%
  • The key takeaway from the report is that overall activity in the largest sector of the U.S. economy accelerated in September, albeit without an expansion in employment activity, as new orders increased along with prices. net-net, this is a report that meshes more with a soft landing outcome than a hard landing one.