The markets started the week off on the downside thanks to the start of earnings season. Reports from the big banks came in mixed overall, which caused investors to take pause as we approach all-time highs. The Dow 30 closed the day lower by 27, the S&P 500 sold off 1, and the Nasdaq closed lower on the day by 8.
Tomorrow investors will focus on earnings season continuing with financials like Bank of America (NYSE: BAC) and BlackRock (NYSE: BLK) among others reporting. Bank of America has had a streak going since July of 2015 where it's met or beat on earnings. Charles Schwab (NASDAQ: SCHW) also reports tomorrow and has the exact same streak going.
Sector News
Bank stocks (NYSE: XLF) pulled back today thanks mostly to earnings from Goldman Sachs, which came in mixed. The focus on the banking sector will continue this week as more names are due to report tomorrow before the bell. Though the sector has recently moved out of a wide and sloppy range, if earnings continue to come in mixed it could move the banks back into that range.
Semiconductors (NYSE: SMH), another important area of the markets, sold off today. The sector has enjoyed a strong move to new highs and spent the first day of the week pulling back in a broad sector sell off. For the year the semis are still higher by about 30%.
So far this year there are four sectors of the S&P 500 that have hit new 52-week highs. That includes Technology, Communication Services, Real Estate, and Utilities, which was the first to make it to the new high. Energy is the furthest from highs with about 15% to go, but Consumer Staples and Consumer Discretionary are within 1%,, hinting at being the next two to hit highs.
Stock News
Goldman Sachs (NYSE: GS) shares sold off today as the company easily beat on earnings (+0.70) but reported revenue that was just under analysts' expectations. The company was mostly optimistic going forward and even raised their dividend by 5 cents per share. The move today sort of ruins the recent breakout in the short term, holding back the banking sector today.
CVS Health (NYSE: CVS) shares were higher today despite a downgrade by Oppenheimer. The analyst says that their current "legacy" business challenges will weigh and that this is more of a long-term opportunity. Shares still moved higher as a Barron's article said the company is positioned well for the new world of investing. Despite today's move, shares are still hovering near lows.
Waste Management (NYSE: WM) announced they are buying one of their competitors (NASDAQ: ADSW) for $3 billion, which equates to $33.15 per share. Shares moved higher today on the news, trading near the deal price. The announced deal price is about a 20% premium for the waste services company.