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Thursday's market close saw the Nasdaq Composite (^IXIC) end its six-day win streak, while the Dow Jones Industrial Average (^DJI) and S&P 500 (^GSPC) stayed afloat in positive territory for the session.
Yahoo Finance markets reporter Josh Schafer explains several key trading themes seen today, including US retail sales indicators and the tech sector pulling away from the market rally.
To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here.
Well, the Nasdaq snapping its six day win streak while the S&P 500 extends its gains, and here with the trading day takeaways is Yahoo Finances, Josh Shafer. Josh.
Josh, so we had a lot of economic data this morning, and I want to start there because it was sort of interesting. So we had retail sales for the month of April. They very, very tinily increased, right? After this big jump that we saw in March. So there is some signs of the impact of tariffs here, right? Because you had tariff front running.
Right.
And then retail sales are month-over-month. So if you bought a lot of stuff in March, it doesn't really make a lot of logical sense that you would then buy the same products in April, right? So you see the fall off there. But what's been interesting talking to your economists is they look at data like this, and they don't really know what to make of it. And I think that was similar with the inflation reports we got this week. We had PPI this morning, producer prices. We had CPI, consumer prices. Both were softer than expected. But economists essentially taking that and saying, I don't really know what to do with this right now. And we're kind of just still in this wait and see mode where this type of data doesn't feel like it's really moving the market to the extent that maybe it normally would be.
Yeah, that's what I felt like investors had. I mean, it was a huge rush of economic data, and people looked through it, and it was interesting. But then they, I think a lot of investors felt like it was backwards-looking, and it's just too soon to gauge the impact of tariffs, which we still feel like are in front of us.
Right. And then so you had this news this week, right? Of course, with the US-China tariff pause pretty early in May, I should note, based on a lot of economic data that comes out sort of in the first two weeks. So I think maybe when you get to June, and you start to get to this tariff rate that we're at now, and get data from that, maybe we can start to get a little bit more.
When you read, when you, I mean, because you read a lot of research, is that where, everyone has different time timelines and bogies. But that's the big question. When does this soft data translate to the hard data? Is that what a lot of folks are calling?
Yeah. Early summer is the running phrase on the street right now, Josh. So essentially, probably end of June, some of that data that comes at the end of the month, and then by the time we maybe get to the June jobs report in that first week of July at that point, people think, "Okay, if tariffs are impacting this economy and significantly impacting economic growth, we should have a solid sense by that point." But again, that's that's still two months away essentially at this point.
Yep. All right, the other interesting thing that happened in the market today, you hit on it off the top, Nasdaq snapping a six day winning streak, but the S&P 500 closed higher, right? And so we look at this board to lock, Josh, and you see these two, these three sectors leading, right? Well today actually had utilities, staples, little bit of a defensive slant, even healthcare. And then you flip over inside that Nasdaq 100. It just wasn't a day for the MAG 7, which I thought was interesting because really over the last week, over this rally, we'll flip it to a sixth day. It's been all about the MAG 7. So you're starting to see some buying action spread to some other areas of the market.
Yeah.
Did you see that as a sign of, okay, could that signal the moves in tech? I mean, could that signal some some caution creeping in the background?
Perhaps, maybe a little bit, but I also think, so we're on the six-day screen here. And a lot of what you hear strategists start to talk about as you get several days into these rallies is, well, people are going to start buying laggards. So look at your six-day screen, consumer staples and healthcare had been lagging the most. You flipped it today. People were buying up some of these laggards, right? And overall, when you think about market breadth, and a lot of stocks participating in this instead of just those seven stocks for the long run, strategists typically argue that's a net positive.
