Stock Market Update

[BRIEFING.COM] The stock market has seen some choppy action to start the week, with the S&P 500 (-0.3%), Nasdaq Composite (-0.3%), and DJIA (-0.3) currently reapproaching earlier session lows. 

Similar to Friday's session, the S&P 500 and Nasdaq Composite both slipped below their 50-day moving averages before mounting a quick rebound that saw the indices reclaim the levels. 

The major averages have not closed below their respective 50-day moving averages since stocks rebounded from April lows, making the technical figure a crucial level of support for market direction. 

Losses in the information technology sector (-1.0%) contributed to the late-morning index-level slide. NVIDIA (NVDA 187.37, -2.80, -1.47%) trades lower ahead of its earnings release Wednesday, while Apple (AAPL 268.82, -3.59, -1.32%) holds a similar loss after Financial Times reported that CEO Tim Cook may step down as early as next year. 

Dell (DELL 123.99, -9.77, -7.30%) is the worst performer in the sector (and the S&P 500) after Morgan Stanley double downgraded the stock to Underweight from Overweight and slashed its price target to $110 from $144.

Losses are relatively modest across the other six retreating S&P 500 sectors, as only the financials (-0.8%) and energy (-0.6%) sectors hold losses wider than 0.5%.

Despite the negative disposition of the major averages, there are still some clear winners in today's trade. 

Alphabet (GOOG 287.73, +10.75, +3.88%) holds a solid gain in response to Berkshire Hathaway Inc. (BRK-B 507.58, -1.36, -0.27%) disclosing a new $4.9 billion position in the company. The communication services sector (+1.5%) held gains wider than 3.0% early in the session. 

Elsewhere, the utilities sector (+1.0%) sees gains across nearly all of its components, while the health care sector (+0.9%) continues its impressive run this month, with today's support coming from managed care names such as Centene (CNC 37.84, +1.46, +4.03%), Elevance Health (ELV 334.72, +8.88, +2.73%), and UnitedHealth (UNH 325.96, +4.10, +1.27%). 

On the macro front, Fed Vice Chair Philip Jefferson (voting FOMC member) echoed the recent cautious sentiment of other Fed officials. Mr. Jefferson stated in a speech this morning that he supported last month's 25-basis-point rate cut, though he added, "The evolving balance of risks underscores the need to proceed slowly as we approach the neutral rate."

The CME FedWatch tool currently assigns a 39.9% probability to a 25-basis point rate cut at the December FOMC meeting, down from 44.4% on Friday. 

Reviewing today's data:

• November Empire State Manufacturing 18.7 (Briefing.com consensus 6.1); Prior 10.7
• August Construction Spending 0.2% (Briefing.com consensus 0.1%); Prior was revised to 0.2% from -0.1%
  • The key takeaway from the report is that the increase in spending came solely from the residential side; unfortunately, that did not include new single-family construction activity. The strength was concentrated in new multifamily construction.