The Dow up almost 100 around 11 a.m., then down about 150 by 2 p.m. to rise again to close 62 down.  Much of this choppiness was due to a lack of direction until Q2 reporting starts but for now all three indexes are headed for two straight quarterly declines for the first time in seven years and especially bad for the S&P seeing its fifth worst YTD decline in 60 years.  There is however a considerable bright spot for the S&P.  Every single year that the index has fallen in Q1 and Q2, it has always sprung back to break-even by the end of Q4. No guarantees, but now’s probably a good time to buy the S&P.  Other good news is that orders for durable goods and new home sales beat expectations, which validates Powell’s statements that the economy is robust enough to avoid recession while the Fed reins in inflation.  Volume was below average at 10.9 billion. 

Mon  June 27, 2022  5:20 PM

Wall Street ends down, pulled lower by growth stocks

By Stephen Culp

DJ: 31,500.68  +823.32       NAS: 11,607.62  +375.43       S&P: 3,911.74  +116.01   6/24

DJ: 31,438.26  -62.42          NAS: 11,524.55  -83.07          S&P: 3,900.11  -11.63      6/27

 

NEW YORK, June 27 (Reuters) - U.S. stocks closed lower on Monday, with few catalysts to sway investor sentiment as they approach the half-way point of a year in which the equity markets have been slammed by heightened inflation worries and tightening Fed policy. read more  The major U.S. stock indexes lost ground after oscillating earlier in the session, with weakness in interest rate sensitive megacaps such as Amazon.com (AMZN.O), Microsoft Corp (MSFT.O) and Alphabet Inc  (GOOGL.O)  providing the heaviest drag.

"The reason for lack of direction this week and next week is investors are looking for what’s going to happen in the second quarter reporting period," said Sam Stovall, chief investment strategist of CFRA Research in New York.  All three indexes are on course to notch two straight quarterly declines for the first time since 2015. They also appear set to post losses for June, which would mark three consecutive down months for the tech-heavy Nasdaq, its longest losing streak since 2015.  The S&P was on track to report its fifth worst year-to-date price decline since 1962 as of Friday, Stovall said. "Every time the SPX rose by more than 20% in a year it fell by an average of 11% starting relatively early in the new year. And all years where the decline started in the first half got back to break even before the year was out."  "No guarantee that’s going to happen this year, but the market could surprise us to the upside," Stovall said.

Rising oil prices helped put energy stocks (.SPNY) out front, with economically sensitive smallcaps (.RUT) and semiconductors (.SOX) and transports (.DJT) also outperforming the broader market.  Economic data surprised to the upside, with new orders for durable goods and pending home sales beating expectations and adding credence to U.S. Federal Reserve Chairman Jerome Powell's assertion that the economy is robust enough to withstand the central bank's attempts to rein in decades-high inflation without sliding into recession. read more 

 

The Dow Jones Industrial Average (.DJI) fell 62.42 points, or 0.2%, to 31,438.26, the S&P 500 (.SPX) lost 11.63 points, or 0.3%, to 3,900.11 and the Nasdaq Composite (.IXIC) dropped 93.05 points, or 0.8%, to 11,514.57.  Among the 11 major sectors of the S&P 500, eight ended the session in negative territory, with consumer discretionary (.SPLRCD) suffering the largest percentage loss. Energy stocks were the clear winners, gaining 2.8% on the day.

With several weeks to go until second-quarter reporting commences, 130 S&P 500 companies have pre-announced. Of those, 45 have been positive and 77 have been negative, resulting in a negative/positive ratio of 1.7 stronger than the first quarter but weaker than a year ago, according to Refinitiv data.  In extended trading, Robinhood Markets (HOOD.O) fell 4% after FTX's Sam Bankman-Fried said his cryptocurrency exchange was in no active M&A conversations with the retail stock trading platform.  In the earlier trading session, Robinhood had jumped 14% after Bloomberg reported that FTX was exploring a deal. read more  During Monday's session, Coinbase Global Inc (COIN.O) dropped over 10% after Goldman Sachs downgraded that cryptocurrency exchange to "sell" from "buy".

Advancing issues outnumbered declining ones on the NYSE by a 1.17-to-1 ratio; on Nasdaq, a 1.02-to-1 ratio favored decliners.  The S&P 500 posted one new 52-week high and 29 new lows; the Nasdaq Composite recorded 24 new highs and 84 new lows.

Volume on U.S. exchanges was 10.91 billion shares, compared with the 12.95 billion average over the last 20 trading days.