Market Wrap for Friday, June 28: Major Averages Close Mixed; Dow Drops Triple Digits
The stock market ended another active week on Friday with the Dow losing more than 100 points.
The S&P 500 recorded moderate losses, but the Nasdaq actually finished the day in positive territory, although the gain was tiny. The trading session saw some profit taking after a series of rallies over the last three days had sent the Dow over 15,000 once again as of Thursday's close.
That level was lost, however, as of the closing bell on Friday. After taking a beating in recent weeks, precious metals bounced along with mining shares.
Treasuries rose for the third consecutive day, reversing recent sharp losses and the U.S. Dollar continued its near-term rally.
The Dow Jones Industrial Average lost 115 points, or 0.76 percent, to close at 14,910.
The S&P 500 lost 7 points, or 0.43 percent, to 1,606.
The Nasdaq gained less than 2 points, or 0.04 percent, to 3,403.
An index measuring manufacturing activity in the Chicago area fell in June, but still showed expansion. Chicago PMI declined to 51.6 compared to 58.7 in May. This came in below economists' consensus estimates which called for the index to register a smaller decline to 55.5.
University of Michigan Consumer Sentiment
The final reading of the University of Michigan Consumer Sentiment index was revised higher to 84.1 for June compared to the previous estimate of 82.7. This was a decline compared to May when the index registered at 84.5. The final reading, however, was ahead of consensus estimates which called for a decline to 82.7.
The energy complex was slightly lower on Friday. At last check, NYMEX crude futures were down 0.52 percent while Brent contracts had registered a decline of 0.71 percent to $102.09. Natural gas lost 0.17 percent on the day to $3.58.
Precious metals bounced back on Friday after incurring steep losses over the last couple of weeks. Near the closing bell, COMEX gold futures were up 1.29 percent to $1,227.20 while silver contracts jumped more than 5 percent to $19.50. Copper was last trading up 0.18 percent to $3.0650.
The grains complex was hit very hard on Friday, with the heaviest losses coming in corn futures. Late in the day, corn had fallen a little more than 5 percent while wheat contracts were down 2.37 percent. Volatility was limited in soft commodities, with the biggest movers being coffee and lumber. Coffee futures fell 1.23 percent while lumber was last trading down 1.61 percent.
Bonds rose for the third straight day on Friday, making up for steep losses last week. Near the close of equities, the iShares Barclays 20+ Year Treasury Bond ETF (NYSE: TLT) was up 0.52 percent to $110.26. Rising bond prices pushed yields lower on the session.
Treasury yields were as follows on Friday: The 2-Year Note was yielding 0.36 percent while the 5-Year Note was yielding 1.41 percent. The 10-Year Note and 30-Year Bond were yielding 2.50 percent and 3.51 percent, respectively.
The U.S. Dollar continued to rise on Friday. Heading into the close of trading for the week, the PowerShares DB US Dollar Index Bullish ETF (NYSE: UUP), which tracks the performance of the greenback versus a basket of foreign currencies, was up 0.22 percent to $22.56.
The closely watched EUR/USD pair was last down 0.21 percent to $1.3019. Other movers included the USD/JPY, which rose 0.80 percent, and the AUD/USD, which fell 1.29 percent on the day.
Volatility and Volume
The VIX was unchanged on Friday after bouncing around significantly over the last couple of weeks. At last check, the widely watched barometer of volatility expectations was trading at 16.86.
Volume was slightly above average to end the week, which has been a trend recently as volatility levels have been on the rise. Around 149 million SPDR S&P 500 ETF (NYSE: SPY) shares traded hands compared to a 3-month daily average of 143 million.
Investors snapped up shares of precious metals miners on Friday as prices for gold and silver jumped. Tahoe Resources (NYSE: TAHO) was among the leaders in the sector, climbing almost 18 percent late in the day.
First Majestic Silver (NYSE: AG) had jumped nearly 12 percent on Friday heading into the closing bell in the wake of surging silver prices.
Shares of B2Gold (NYSE: BTG), which have been active in recent days, surged almost 13 percent near the close.
Rare earth miner Molycorp (NYSE: MCP) traded up almost 10 percent after the SEC informed the company that it has completed its investigation into the accuracy of its public disclosures and has recommended that no enforcement action be taken.
Arkansas Best (NASDAQ: ABFS) climbed around 15 percent after the company said that its ABF Freight Systems employees represented by the Teamsters union have ratified ABF's national collective bargaining agreement for the next five years.
Dana Holding Corp. (NYSE: DAN) rose roughly 6 percent after the company's board agreed to expand its stock buyback program to $1 billion.
Blackberry-maker Research in Motion (NASDAQ: BBRY) was pummeled after reporting a surprise loss for the fiscal first-quarter. In addition to the loss, the company's quarterly shipments of new smartphones was at the low-end of Wall Street expectations and its subscriber base shrunk by four million to 72 million. The stock closed the session down almost 28 percent.
Management consulting giant Accenture (NYSE: ACN) plummeted more than 10 percent on Friday after its fiscal third-quarter revenue came in below expectations and the company lowered its full-year revenue outlook.
Home health-care stocks took a beating on Friday after the Centers for Medicare & Medicaid Services proposed cutting reimbursement rates over the next four years. Analysts at Robert W. Baird wrote that it "looks to be the absolute worst possible outcome for the sector," with other firms echoing similar sentiments. Company's effected include Amedisys (NASDAQ: AMED), Gentiva Health (NASDAQ: GTIV), and LHC Group (NASDAQ: LHCG). All three of the stocks posted double-digit percentage declines on Friday, led by LHCG, which lost 13 percent.
AZZ Incorporated (NYSE: AZZ) fell nearly 11 percent on the session after reporting a 9 percent decline in fiscal first-quarter earnings and guiding for current quarter earnings and revenue that is below estimates.
Arena Pharmaceuticals (NASDAQ: ARNA) shed over 9 percent on Friday. The biotech stock earned a negative mention from CNBC's Jim Cramer during his Mad Money show on Thursday.
Palo Alto Networks (NYSE: PANW) fell 5 percent during the final trading session of the week. Analysts at Oppenheimer initiated coverage on the stock with a "Market Perform" rating and $47.00 price target on Thursday.
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