Stock Market Update

[BRIEFING.COM] The stock market opened to gains, supported by buy-the-dip trading and gains in the mega cap space. The S&P 500 trades 0.5% higher and the Nasdaq Composite sports a 0.9% gain. It is the last session in the Santa Claus Rally period (last five trading sessions of the year and first two of the new year). The S&P 500 would need to close about 60 points higher to have a positive Santa Claus Rally. 

Gains are relatively broad based so far. All 11 S&P 500 sectors are higher led by information technology (+1.4%) and utilities (+1.2%). The financial sector is the worst performer so far, trading just above its prior close.

Strength in the mega cap space has an outsized impact on index performance. NVIDIA (NVDA 143.82, +5.50, +4.0%) and Tesla (TSLA 387.15, +7.95, +2.1%) are standouts in the space. 

The December ISM Manufacturing Index checked in at 49.3% (Briefing.com consensus 48.5%) versus 48.4% in November. The dividing line between expansion and contraction is 50.0%, so the December reading suggests manufacturing sector activity contracted versus the prior month but at a slower pace. This was the ninth straight month (and 25th out of 26) that economic activity in the manufacturing sector contracted.

The key takeaway from the report is that manufacturing sector activity overall continued in a state of contraction, although the pace of contraction slowed at the same time the prices index picked up.