U.S. stocks managed a mixed finish in some choppy action as continued concern in regard to the global trade scene seemed to play a role in equities unsuccessful attempt to snap a recent string of declines. Positive reads on employment and manufacturing activity, along with some upbeat quarterly results from Dollar General and Williams-Sonoma were unable to influence a positive finish. Treasury yields ticked higher, along with the U.S. dollar and crude oil prices, while gold was lower.

The Dow Jones Industrial Average (DJIA) increased 116 points (0.5%) to 24,873, the S&P 500 Index declined 2 points (0.1%) to 2,747, and the NASDAQ Composite lost 15 points (0.2%) to 7,482. In moderate volume, 814 million shares were traded on the NYSE and 2.0 billion shares changed hands on the NASDAQ. WTI crude oil gained $0.23 to $61.19 per barrel and wholesale gasoline was flat at $1.92 per gallon. Elsewhere, the Bloomberg gold spot price fell $8.30 to $1,316.56 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—was 0.5% higher at 90.12.

Weekly initial jobless claims declined by 4,000 to 226,000, versus the Bloomberg expectation calling for a decline to 228,000, with the prior week’s figure being revised lower by 1,000 to 230,000. The four-week moving average decreased by 750 to 221,500, while continuing claims rose by 4,000 to 1,879,000, south of estimates of 1,903,000.

The Import Price Index rose 0.4% month-over-month (m/m) for February, above of projections of a 0.2% gain, following January’s downwardly revised 0.8% rise. Compared to last year, prices were up by 3.5%, matching forecasts and compared to January’s negatively revised 3.4% increase.

The Empire Manufacturing Index showed output from the New York region jumped further into expansion territory (a reading above zero) for March. The index rose to 22.5 from February’s unrevised 13.1 level, with forecasts calling for a 15.0 reading.

The Philly Fed Manufacturing Index in March dipped more than expected but remained solidly at a level depicting expansion (a reading above zero), declining to 22.3 from 25.8 in February, compared to estimates of a dip to 23.0.

The National Association of Home Builders (NAHB) Housing Market Index showed homebuilder sentiment this month dipped to 70 in March, from February’s downwardly revised 71 level, versus forecasts of a 72 reading. The index still sits decisively above the 50 mark, the point of separation for good versus poor conditions. The NAHB said a strong labor market, rising incomes and a growing economy are boosting demand for homeownership even as interest rates rise, setting the stage for the single-family sector to continue to make gains at a gradual pace in the months ahead. However, the NAHB cautioned that builders are reporting challenges in finding buildable lots, which could limit their ability to meet growing consumer demand for housing.

This brings focus on tomorrow’s look at February home construction activity, in the form of housing starts and building permits, which both jumped in January. Starts are projected to decline 2.7% m/m to an annual rate of 1,290,000 units and permits are estimated to drop 4.1% to an annual rate of 1,320,000 units. The healthy housing market has been underpinned by the strong employment landscape. Last week’s February employment report showed strong jobs growth, while at the same time benign wage pressures, sparking a rally in the stock market.

Bond yields have retreated recently from a rally in the past year and the U.S. dollar continues to show fits and starts as it remains in a downtrend, while stocks have relinquished some of last week’s sharp rally. The markets are grappling with Fed uncertainty as job growth remains solid and inflation is ticking higher, cooled geopolitical concerns and global trade uneasiness in the wake of President Donald Trump’s tariffs on steel and aluminum imports and the recent shakeups in the White House.

Schwab Center for Financial Research – Market Analysis Group

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