Tuesday, May 17, 2016 1pm EST
U.S. stocks held lower in choppy trade Tuesday, with declines in consumer staples and utilities offsetting gains in energy as oil prices climbed.
The Dow transports outperformed, holding about 2 percent higher and tracking for its best day since April 13, with Avis Budget leading all constituents higher.
“A lot of money gets pushed hard into one sector and it helps the overall market,” said Adam Sarhan, CEO of Sarhan Capital.
“We’re seeing a lot of … sideways, trendless activity as the market desperately waits for the next big catalyst,” he said.
Consumer staples and utilities traded more than 1 percent lower to lead S&P 500 decliners. Constellation Brands, Kraft Heinz and Hormel Foods were the greatest laggards in the staples sector with declines of about 2.5 percent or more. Only Archer-Daniels-Midland and Whole Foodstraded higher.
The Nasdaq composite briefly turned higher soon after the open, as Apple tried for a third-straight day of gains.
“We’re just following crude again,” said Jeremy Klein, chief market strategist at FBN Securities, noting stocks remained range-bound.
It’s “still too volatile for people to come in and not that volatile for people to get nervous and sell everything,” he said.
WTI traded more than 1 percent higher above $48 a barrel after earlier hitting its highest since mid-October amid near-term supply outages. In Canada, a wildfire prompted evacuation of about 4,000 people from work camps outside the Fort McMurray oil hub, Reuters said. Nigerian oil output has been cut by almost 40 percent, the government said.
Brent tried for gains, trading near $49.40 a barrel as of 11:48 a.m. ET.
The Dow Jones industrial average held about 40 points lower after earlier falling 100 points.
Home Depot traded about 1.5 percent lower after briefly dipping 2.5 percent, for the greatest negative impact on the Dow as most constituents declined. Early Tuesday, the home improvement retailer posted quarterly earnings and revenue that topped expectations and also raised its full-year guidance. Over the last 12 months, shares are up about 18 percent.
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In U.S. economic news, industrial production rose 0.7 percent in April. Capacity utilization was 75.4 percent.
The Consumer Price Index rose 0.4 percent in April, the Labor Department said. Ex-food and energy, the index rose 0.2 percent last month, or 2.1 percent over the last 12 months. That compares with a 2.2 percent rise for the 12 months ending March.
Housing starts rose 6.6 percent in April to a seasonally adjusted annual pace of 1.17 million units.
Treasury yields held higher after the data, with the 2-year yield briefly hitting 0.819 percent, its highest in nearly three weeks.
Yields came off highs to trade mixed in late-morning trade ET, with the 2-year yield flat around 0.79 percent and the 10-year yield lower near 1.74 percent.
The U.S .dollar index traded slightly lower, with the euro around $1.134 and the yen near 109 yen against the greenback as of 11:50 a.m. ET.
“I don’t think CPI’s hot enough to make a difference (about a Fed rate hike). I think you’ve got an unchanged rate hike environment. You’ve got a bit of sell-off in European markets,” said Art Hogan, chief market strategist at Wunderlich Securities.
European stocks were mostly lower, with the German DAX off more than half a percent.
TJX Cos, the owner of T.J. Maxx and Marshalls, reported a 9.9 percent rise in quarterly sales, while comparable sales rose 7 percent. Net income rose to $508.3 million, or 76 cents per share, in the first quarter ended April 30 from $474.6 million, or 69 cents per share, a year earlier.
The S&P 500 declined 4 points, or 0.17 percent, to 2,063, with utilities leading six sectors lower and energy the top advancer.
The Nasdaq composite declined 5 points, or 0.10 percent, to 4,770.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded below 15.
About four stocks advanced for every three decliners on the New York Stock Exchange, with an exchange volume of 349 million and a composite volume of nearly 1.6 billion in late-morning trade.
U.S. crude oil futures for June delivery rose 59 cents to $48.31 a barrel on the New York Mercantile Exchange.
Gold futures for June delivery gained $7.60 to $1,281.80 an ounce as of 11:52 a.m. ET.
On tap this week:
12 p.m. San Francisco Fed President John Williams, Atlanta Fed President Dennis Lockhart on a panel
1:15 p.m. Dallas Fed President Rob Kaplan
Earnings: Target, Lowe’s, SAB Miller, Cisco, Hormel, Staples, Booz Allen, L Brands, Salesforce.com, Analog Devices, Burberry, Take Two Interactive
2 p.m. FOMC minutes
Earnings: Wal-Mart, Gap, Applied Materials, Dick’s Sporting Goods, Autodesk, Advanced Auto Parts, Ross Stores, Shoe Carnival, Mentor Graphics, Brocade
8:30 a.m. Jobless claims; Philadelphia Fed survey
10:30 a.m. New York Fed President William Dudley press briefing
Earnings: Campbell Soup, Deere, Foot Locker, The Buckle
10 a.m. Existing home sales
*Planner subject to change.