Stocks made an all-time high Friday, but cracks rapidly appeared
in the bullish facade as tensions between Russia and Ukraine heated
The second estimate of fourth-quarter GDP came in at +2.4%,
slightly below the +2.5% consensus. Personal Consumption rose 2.6%,
which missed Wall Street's +2.9% estimate.
The February Chicago PMI hit 59.8, well ahead of the 56.4
The final February University of Michigan Consumer Confidence
reading was 81.6, fractionally better than expected.
January Pending Home sales rose 0.1%, well below expectations for a
1.8% gain. That put a big damper on housing stocks, which have been
among the best-performing sectors year-to-date.
(INDEXSP:.INX) futures were down modestly ahead of the GDP report,
indicating that investors had somewhat low expectations ahead of
today's data deluge. Stocks began rising at the open, even ahead of
the better-than-expected Chicago PMI and Consumer Confidence
The S&P 500 hit a recrod intraday high at 1867.92 before
dropping to finish at a record closing high of 1859.45, a 0.3%
Aside from general profit-taking, the downward action was spurred
on by geopolitics.
New leaders in Ukraine said Russian forces took control of two
airports in Crimea, which Russia denied. There are also news
reports of Russian troops deploying elsewhere in Ukraine.
Additionally, former Ukrainian President Viktor Yanukovych, who is
wanted for mass murder in Ukraine, appeared at a press conference
in Russia claiming he is still in power.
However, there were some ugly spots in the action today.
Homebuilders, which have been big outperformers year-to-date, were
ugly today as the January Pending Home Sales Report disappointed.
And other risk-on areas of the market such as social media,
biotech, emerging markets, and small caps had solid opens before
Indicative of the deteriorating mood,
) reported very strong quarterly earnings numbers after yesterday's
close and opened higher this morning before declining 5.8% on the
) announced it was lowering its fourth-quarter and 2013 net income
by $235 million following the discovery of fraudulent dealings in a
Bitcoin was also in the spotlight after the Mt. Gox exchange
announced that it lost 750,000 Bitcoins valued at over $400
million. Later in the day, a customer proposed a class-action
lawsuit in a Chicago federal court.
Tomorrow's Financial Outlook
The data storm will continue on Monday, with Personal Income and
Spending, IXM Index, Construction Spending, and Auto Sales numbers
all on the way.
Additionally, traders will be watching overseas markets to see if
they follow the downturn in US stocks, and to gauge the potential
impact of the Russia/Ukraine conflict.
There will be some companies reporting earnings --
Nu Skin Enterprises
) among them -- but none are likely to move the market.