YAHOO [BRIEFING.COM]: The
resumption of selling pressure amid rekindled concerns over Europe resulted in
another weekly loss for stocks. The market has mustered only one weekly gain,
which was actually only an incremental move higher, since April.
News that Greece has agreed to
a five-year austerity plan with the EU and IMF has been regarded as a positive,
but participants remain mindful of the challenges related to passing the plan
in parliament, implementing it, and then upholding it. Failure in any facet
would prolong the country's troubles.
Traders were reminded that
Greece isn't the only country in the eurozone periphery that is grappling with
fiscal and financial problems when rumors surfaced that several Italian banks
are undercapitalized. Questions and concerns about the financial future of
countries in the eurozone periphery detracted from a pleasing IFO reading from
Germany, which is the largest economy in Europe, and generally regarded as the
most financially sound.
Domestic data proved pleasing,
but the positive response dissipated after the open. To the surprise of many
economists, first quarter GDP was revised upward to reflect growth of 1.9%.
Durable goods orders for May jumped 1.9% after an upwardly revised 2.7% decline
in the prior month, but orders less transportation increased by 0.6% after a
0.4% decline in the prior month. The consensus among economists polled by
Briefing.com had called for a 1.8% increase in total orders and a 0.7% increase
in orders less transportation.
Selling was somewhat
restrained in the early going, but pressure gradually picked up. The major
market averages ultimately settled near their session lows with losses of at
least 1%. That underpinned another weekly loss for stocks. Although this week's
move lower was only fractional, it was enough to offset last week's incremental
advance, which was the market's first weekly gain since April.
Financials drove most of this
week's decline; the sector lost about 1% during the course of the past five
trading days, including its 0.7% slide this session.
Energy stocks and tech stocks
were this session's worst performers, though; both groups fell almost 2%.
Drillers and oil service plays were among the worst performers in the energy
space, while Oracle (ORCL 31.14, -1.32) led large-cap tech
issues lower after the firm's quarterly report revealed inconsistent demand
among its major segments. Oracle's better-than-expected bottom line was
shrugged off.
Defensive-oriented utilities
made up the only major sector that managed to settle in positive territory. As
a group, utilities had been up more than 1% in early action, but were dragged
down amid broad market weakness to finish the session with a 0.2% gain.
An interest in safety renewed
buying among fixed income plays. In turn, the yield on the benchmark 10-year
Note fell to a new 2011 low several basis points below 2.90%, which had been a
point of resistance in recent sessions.
Share volume was robust this
session, but for clarification, the total was inflated by all of the
reconstitution and rebalancing going on in the Russell Indices at the close of
trade.
It was a quieter session for
commodities, following yesterday's volatile trade. Strength in the dollar, once
again, pressured some commodities. August gold shed 1.3% to close at $1500.90
per ounce. Gold prices traded below the $1500 level to lows at $1498.50, its
lowest levels since May 20. Gold shed over 50 points in the last two trading
sessions of the week to mark its largest weekly decline since early May July
silver finished off 0.9% to $34.70 per ounce.
It was a much more uneventful session for August crude oil, which gained 0.2%
to close at $91.16 per barrel. Crude did break below $90 to notch session lows
at $89.82, but was able to retrace that selloff to finish near unchanged on the
session. For the week, crude oil dropped ~2%. July natural gas finished up 0.9%
to $4.23 per MMBtu, staging a modest rebound following yesterday's sizeable
inventory-induced selloff.
Advancing Sectors: Utilities (+0.2%)
Declining Sectors: Materials (-0.6%), Financials (-0.7%),
Consumer Staples (-0.7%), Telecom (-0.8%), Consumer Discretionary (-1.0%),
Health Care (-1.2%), Industrials (-1.2%), Tech (-1.8%), Energy (-1.9%)DJ30
-115.42 NASDAQ -33.86 NQ100 -1.7% R2K -0.6% SP400 -0.8% SP500 -15.05 NASDAQ
Adv/Vol/Dec 1060/2.87 bln/1494 NYSE Adv/Vol/Dec 1071/1.74 bln/1894