The major U.S. indexes opened the day strongly lower on disappointing earnings news and guidance from Amazon (AMZN) and Alphabet (GOOG) after the market close yesterday.
But the markets reversed in the morning–the low for the day for the Standard & Poor’s 500 so far (as of 2:38 p.m. New York time) came at 10:57 a.m. at 2629.27. The index moved steadily upwards to what is the day’s high so far at 2691.5 at 1:05 p.m.
As of 2:38 the Standard & Poor’s 500was at 2669.83, down 1.41%. The Dow Jones Industrial Average was lower by 0.82%. The NASDAQ Composite Index had dropped 1.75%
Interestingly and importantly, the improvement in the market hasn’t done much for technology stocks–the Technology Select Sector SPDR ETF (XLK) was down 1.51% at 2:38 p.m–and technology leaders have continued to sell off today. Amazon (AMZN) is down another 7.25% as of 2:38 p.m., a marginal improvement on its 7.62% loss as of noon. Alphabet (GOOG) is off 2.31%. Nvidia (NVDA), another technology darling, lost 4.45% as of 2:38, actually worse than the 3.61% drop as of noon. Arista Networkds (ANET) was lower by 4.81% as of 2:38 p.m. Netflix (NFLX) was off 3.69% and even Microsoft (MSFT), which had moved up on its positive earnings report, was 1.03% lower as of 2:38 p.m.
But the market isn’t selling off everything today. Bristol Myers Squibb (BMY), which reported positive earnings yesterday, is up 2.42%. Oil equipment maker Patterson-UTI (PTEN), which also reported positive earnings yesterday, was up 4.71% as of 2:38 p.m.
I’m not even seeing the simple “sell risk” action of the down days this week. Biotechs Sangamo (SGMO) and Nektar Therapeutics (NKTR) were up 4.09% and 1.63%, respectively, after being punished in the flight from risk earlier this week.
To me the day looks like one for sector rotation with money moving out of technology and selectively into stocks in other sectors that seem cheap after the selling this week.
All conclusions about this market based on a single day’s action are clearly very tentative. But “interesting” as they say.
And by the way, the CBOE S&P 500 Volatility Index (VIX) was up only 3.14% to 24.98 as of 2:38 p.m. That’s not indicative of panic by any means.
