Wall Street settled on both sides of the ledger following a weaker-than-expected retail sales report — and more in Tuesday’s stock market update.
More positive news from the housing market offset some of the opening losses with small caps outperforming the broader market.
The Russell 2000 rose 0.4% after tapping an intraday and fresh all-time peak of 1,795.
The Dow fell 0.6% following the intraday pullback to 29,520.
The S&P 500 lost 0.5% with the morning low reaching 3,588.
The Nasdaq slipped 0.2% after trading to an opening low of 11,852.
Energy showed the most sector strength after rising 1% while Real Estate added 0.1% to round out the winners. Utilities sank 2% to pace sector laggards while Healthcare and Consumer Staples were off 0.7%.
GoodRx Holdings Inc. (Nasdaq: GDRX) shares sank 22% after Amazon.com Inc. (Nasdaq: AMZN) announced two new pharmacy offerings — Amazon Pharmacy, a new store on Amazon, and an Amazon Prime prescription savings benefit. The news builds on Amazon’s 2018 acquisition of PillPack.
Shares of CVS Health Corp. (NYSE: CVS), Walgreens Boots Alliance Inc. (Nasdaq: WBA) and Rite Aid Corp. (NYSE: RAD) also fell on the news as companies in the pharmacy supply chain now face increased competition.
The Q3 earnings season continues to wind down with actual results coming in better than expected, with a record proportion of companies beating earnings per share and revenue estimates.
For the 464 S&P 500 companies, or nearly 93% of the index’s membership, that have reported quarterly results through Monday, 84.5% have topped EPS estimates and a record 75.6% have beaten revenue estimates. This is significantly above prior levels in recent years.
Total earnings for these 464 index members that have reported already are down -9% on -2.1% lower revenues. Looking at the quarter as a whole, Q3 earnings are expected to be down -8.5% on -1.3% revenues.
European markets settled mixed.
The Belgium20 gained 0.3% and France’s CAC 40 was higher by 0.2%. UK’s FTSE 100 fell 0.9% and the Stoxx 600 was down 0.2%. Germany’s DAX 30 was down 5 points, or 0.04%.
Asian markets were also mixed following new concerns that U.S. President Donald Trump could take further unfriendly measures against China.
Japan’s Nikkei climbed 0.4% and Australia’s S&P/ASX 200 added 0.2%. Hong Kong’s Hang Seng edged up 0.1%. South Korea’s Kospi and China’s Shanghai slipped 0.2%.
Retail Sales for October edged up 0.3% and were up 0.2% excluding autos. Expectations were for a rise of 0.6%. Sales excluding autos, gas and building materials were up just 0.1% after surging 1.2% in September. The components were mixed. Vehicle and parts sales were up 0.4% in October from the prior 2.9% gain. Gas station sales rose 0.4% from 2% previously. Building materials increased 0.9% from 0.4%. Non-store retail sales bounced 3.1% from -1.7%. Clothing plunged -4.2% from the prior 13.6% surge while sporting goods tumbled -4.2% from 8%. Furniture sales fell -0.4% from 0.6%. Health and personal care sales slipped -0.1% from 1.3%.
Import prices dipped -0.1% in October and export prices increased 0.2%. September import prices were revised to 0.2% while export prices were maintained at 0.6%. On a 12-month basis, import prices posted a -1% year-over-year growth rate from -1.4%, and export prices were at a -1.6% year-over-year contraction rate from -1.8% previously.
The iShares 20+ Year Treasury Bond ETF (Nasdaq: TLT) snapped a two-session slide after trading to an intraday high of $159.16. Prior and lower resistance at $159-$159.50 was cleared but held. A close above the the latter would signal additional upside towards $160.50-$161 and the 50-day moving average.
New support is at $158.50-$158 followed by $157-$156.50.
The iPath S&P Vix Short-Term Futures (NYSEArca: VIX) closed higher for the first time in three sessions following the opening bounce to 24.09. Current and lower resistance at 24-24.50 was breached but held. A close above the latter would signal a retest towards 26-26.50.
Key support remains at 22 with a close below this level being a bullish signal for the market.
The S&P 400 Mid Cap Index (NYSE: MID) extended its winning streak to three sessions following the intraday push to 2,166, a fresh all-time high. Uncharted territory and lower resistance at 2,175-2,200 was challenged but held.
Current support is at 2,125-2,100. A close below the latter would indicate a near-term top with backtest potential towards 2,075-2,050.
RSI (relative strength index) remains in a slight uptrend after clearing and holding key resistance at 70. Continued closes above this level keeps 75 and the early June high in play. Support is at 65-60.
The iShares MSCI Emerging Markets ETF (NYSE: EEM) was down for the first the first time in three sessions despite testing an afternoon high of $49.01. Current and lower resistance at $49-$49.50 was cleared but held. A close above the latter and this month’s 52-week peak at $49.53 would be a bullish signal for additional momentum towards $50.50-$51.
Support is at $48.50-$48 followed by $47.50-$47.
RSI has leveled out with key resistance at 70 holding. A close above this level would indicate additional strength towards 75-80 and prior peaks from last December. Support is at 65-60.
Check back after the closing bell each day for the most important news and numbers in the WealthPress stock market update.