The U.S. stock market continued to pullback on Friday after
recording large losses on Thursday. Over the last 5 trading
sessions, the S&P 500 is now down more than 2 percent.
Investor anxiety over the possibility of the Federal Reserve
tapering its quantitative easing program in September has been
the primary catalyst behind the sell-off. Losses were contained
during Friday's session, with the Dow closing down around 31
points after losing more than 200 points on Thursday.
On the economic front, a disappointing August reading for the
University of Michigan's Consumer Sentiment Index weighed on risk
appetite on the day. In other markets, the U.S. Dollar rose
slightly while long-term Treasury prices recorded moderate
losses. Both gold and crude oil closed Friday's session with
gains despite weakness in equities.
The Dow Jones Industrial Average fell 31 points, or 0.20
percent, to 15,081.
The S&P 500 lost around 5 points, or 0.33 percent, to
The Nasdaq shed a little better than 3 points, or 0.09
percent, to finish at 3,603.
Housing starts rose in July by 5.9 percent to 896,000 compared
to 846,000 in June. This was very slightly ahead of consensus
estimates calling for an increase in housing starts for the month
Building permits for July climbed to 943,000 versus 918,000 in
June. This was above the consensus, which expected permits would
rise to 934,000 for the month.
Unit Labor Costs
After registering declines of 1.7 percent in each of the last
two quarters, nonfarm labor productivity rose 0.9 percent in the
second-quarter of 2013. The consensus estimate called for no
change in labor productivity for Q2.
University of Michigan Consumer Sentiment
Consumer sentiment fell considerably more than expected for
August. The University of Michigan Consumer Sentiment Index
declined to 80.0 in the preliminary August reading. This compares
to a reading of 85.1 in July. The consensus had expected no
change in the index for the month.
A look ahead to next week: FOMC, housing market
Crude oil futures traded up again on Friday. Late in the
afternoon, NYMEX crude futures were higher by 0.12 percent to
$107.46. Brent crude contracts had risen 0.76 percent to $110.43.
Natural gas fell a little less than 1.50 percent on the session
A recent rally in precious metals prices continued on Friday.
COMEX gold futures climbed 1.12 percent to $1,376.10 while silver
contracts were last up 1.57 percent to $23.30. Copper added 0.84
percent on the session to $3.3685.
The grains complex was mostly lower to end the week. Near the
close, corn contracts were down 1.85 percent and wheat had lost
0.92 percent. Movers in soft commodities included sugar and
cotton. Sugar futures fell 1.45 percent while cotton was trading
up 1.67 percent.
Long-term Treasury prices were lower on Friday afternoon. Near
the close of equities, the iShares Barclays 20+ Year Treasury
Bond ETF (NYSE:
) was down 0.39 percent to $103.32.
Treasury yields were as follows in afternoon trade on Friday:
The 2-Year Note was yielding 0.34 percent and the 5-Year Note
yield was sitting at 1.58 percent. The 10-Year Note and 30-Year
Bond were yielding 2.83 percent and 3.86 percent,
Heading into the closing bell, the U.S. Dollar was slightly
higher. At last check, the PowerShares DB US Dollar Index Bullish
), which tracks the greenback versus a basket of foreign
currencies, was up 0.14 percent to $21.97.
The closely watched EUR/USD pair was last down 0.08 percent to
$1.3336. Other movers included the USD/JPY, which rose 0.20
percent and the AUD/USD, which added 0.66 percent on the day.
Ackman throwing in the towel at J.C. Penney?
Volatility and Volume
The CBOE Volatility Index (VIX) fell on Friday despite a lower
stock market. Late in the day, the widely watched barometer of
volatility expectations was down 2.38 percent to 14.38.
Volume was considerably heavier than it has been in recent
weeks, but remained below the 3-month average. On the session,
around 121 million SPDR S&P 500 ETF (
) shares traded hands compared to a 3-month daily average above
Qihoo 360 Technology (NASDAQ:
) rose around 11 percent to end the trading week. The move came
in the wake of an 11 percent decline in the stock during the two
previous trading sessions amid general weakness in Chinese tech
names. Company president Qi Xiangdong stated that Qihoo's So.com
search engine now has 20 percent market share in China, which
helped boost the stock.
Aspen Technology (NASDAQ:
) jumped around 8 percent on Friday after the company's fiscal
fourth-quarter earnings results.
) added around 5 percent on the session after analysts at Goldman
Sachs reiterated their Buy rating on the stock.
National Technical Systems (NASDAQ:
) rose 38 percent on the day after the company agreed to be
acquired by Aurora Capital Group for around $267 million in
Shares of Pain Therapeutics (NASDAQ:
) jumped around 36 percent in intra-day trading after the
government reported that Pfizer (NYSE:
) was launching a new study of the painkiller, Remoxy, which was
developed by Pain Therapeutics and Durect Corp. (NASDAQ:
). Previously, Pfizer had said it was unsure if it would continue
developing the drug. Durrect shares added around 17 percent on
Sophiris Bio (NASDAQ:
) fell 17 percent in its debut on the Nasdaq Stock Market. Prior
to trading, the company had reduced the price of its IPO and
boosted the number of shares being sold.
) slumped again on Friday. The stock soared on Wednesday after
positive data was released from a late-stage trial of its
diabetes treatment Afrezza, but the shares have come under
pressure over the last two trading sessions as traders were quick
to take profits. MannKind closed down more than 13 percent on the
Jos. A. Bank (NASDAQ:
) lost around 7 percent after the company said that its fiscal
second-quarter financial results are likely to miss
Retailer Nordstrom (NYSE:
) fell almost 5 percent on Friday after the company released its
fiscal second-quarter earnings results and cut its full-year
PowerSecure International (NASDAQ:
) fell more than 5.50 percent after its common stock offering
priced at a discount to Thursday's closing price.
A look at recent insider purchases.
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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