Headline Retail Sales Fall 16.4 Percent: Worst Drops On Record

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The major indices are all trading lower at midday following yet another hectic morning session. Traders mulled a mixed bag of economic reports, the continued escalation between the U.S. and China, and the positive COVID-related news flow, and while bulls once again staged an impressive comeback following a bearish open, volatility remains very high. on Wall Street. The Trump administration turned its attention to Chinese tech giant Huawei again, threatening to cut the firm off of some of its key suppliers, and the Asian giant is reportedly looking into countermeasures against the likes of Apple (AAPL, -2%) and Boeing (BA,-2.6%). As for the economy, the retail sales report was at the center of attention today, and both headline retail sales and the less volatile core sales missed expectations by a wide margin, falling by 16.4% and 17.2% respectively, representing the worst drops on record.

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Headline Retail Sales And The Less Volatile Core Sales Fall

The Michigan consumer sentiment number, on the other hand, provided a bullish surprise and that could foreshadow a rebound in the consumer economy. The Empire State Manufacturing Index printed at -46.5, well above the consensus estimate and its previous reading of -78.2. Industrial production was also slightly better-than-expected but the 11.2% decline is still the worst reading in over a hundred years.

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Market Wrap

Dow: 23,443, - 182 or 0.2%

S&P 500: 2,831 - 22 or 0.8%

Nasdaq: 8,877, - 67 or 0.8%

Russell 2000: 1,245, + 7 or 0.6%

Market breadth has been relatively strong this morning, with decliners outnumbering advancing issues by only a 3-to-3 ratio on the NYSE at midday. Only 14 stocks hit new 52-week lows on the NYSE and the Nasdaq, while 32 stocks hit new 52-week highs. The major indices spiked deep below their daily VWAPs (Volume-Weighted Average Price) towards the end of the morning session, signaling intraday selling pressure. Treasury yields inched higher today, but since financials, real estate stocks, tech stocks, and industrials are all among the weaker issues it’s hard to conclude that, investors are eager to take on risk, so bulls still need to be cautious here. Stay tuned!