Stock Market Update

[BRIEFING.COM] There is some mixed action at the index level today, although selling interest has picked up in the last 30 minutes. The weakness seen today has been driven largely by some softness in the mega-cap space ahead of key earnings reports later this week from Microsoft (MSFT 388.65, -3.20, -0.8%), Meta Platforms (META 543.13, +2.23, +0.4%), Apple (AAPL 208.10, -1.18, -0.6%), and Amazon.com (AMZN 186.73, -1.02, -0.5%).

Also, there is a bit of a digestion phase going on today after last week's huge rebound. That doesn't mean today is bad or good, only that market participants are being a little more deliberate with their moves.

With that approach, they are favoring small-cap stocks so far and are pulling back some on mega-cap stocks. The Vanguard Mega-Cap Growth ETF (MGK) is down 0.8%. That is the basis for the underperformance of the Nasdaq Composite, and it is why the market cap-weighted S&P 500 (-0.6%) is underperforming the equal-weighted S&P 500 (flat).

The information technology sector (-1.5%) is the market's weakest link, which matters greatly at the index level since it is the market's most heavily weighted sector. The consumer discretionary (-1.0%) and communication services (-0.8%) sectors are the other key drags and, incidentally, have mega-cap constituents.

The news flow today has been fairly limited, but that will change as the week carries on. There are more than 160 S&P 500 companies due to report their results this week, and the economic calendar features a slate of important economic reports, including the Adv. Q1 GDP Report, the March Personal Income and Spending Report, the April ISM Manufacturing Index, and the April Employment Situation Report.

The Russell 2000 is up 0.2%; the Dow Jones Industrial Average is flat; the S&P 500 is down 0.6%; and the Nasdaq Composite is down 1.1%.