Stock Market Update

[BRIEFING.COM] The major averages quickly retreated from opening gains as weaker-than-expected economic data and a lack of supporting developments from yesterday's advance prompted some broad-based selling activity.

The July ISM Services PMI registered on the brink of contraction at 50.1% and included a faster increase in the price index and a faster contraction in the employment index, the combination of which has stoked some stagflation concerns, especially when combined with last week's soft payrolls report.

Equities headed lower shortly after the open, with the losses keeping eight sectors in negative territory. 

Additionally, there are lingering tariff concerns in play ahead of the August 7 deadline, with President Trump stating in a CNBC interview that he will announce separate tariffs on semiconductors and pharmaceuticals soon.

The information technology sector (-0.9%) is among the worst-performing S&P 500 sectors as a result, masking a healthy gain from Palantir Technologies (PLTR 171.19, +10.54, +6.6%) after the company beat EPS expectations and delivered upside revenue guidance following an impressive 48% year-over-year revenue increase.

The utilities (-0.9%), energy (-0.6%), and communication services (-0.5%) sectors also post losses greater than 0.5%. Meanwhile, the materials (+0.6%), consumer discretionary (+0.5%), and real estate (+0.3%) sectors are the three sectors trading above their flatline.

Yesterday's action was reflective of a buy the dip" trade from Friday's lows, with little in terms of developments to substantiate the extent of the advance. Today's losses are modest in comparison to the previous gains, and the major averages still sport gains greater than 1.0% for the week. 

Currently the major averages are off their session lows, with the DJIA (flat) at its unchanged level, while the S&P 500 (-0.3%) and Nasdaq Composite (-0.5%) have narrowed their losses.