Shares have barely changed despite strong home price and consumer confidence scores


The S&P 500 hit another record high on Tuesday amid bullish economic data, but fell later in the session as Wall Street continued its recent period of low volatility.

The broad market index lost less than 0.1% in afternoon trading. The Dow Jones Industrial Average was flat after rising more than 100 points at the beginning of the session, while the tech-heavy Nasdaq Composite was up less than 0.1%.

Home builder stocks rose after S&P CoreLogic Case-Shiller said home prices rose more than 14% year over year in April. Five US cities, including Seattle, saw their largest annual increase on record. Lennar and PulteGroup shares rose 1% and 2%, respectively.

Semiconductor stocks gained strength later in the session, with Skyworks and Advanced Micro Devices climbing 4.2% and 2.9% respectively. General Electric kicked off the industrial sector, rising over 1% after Goldman Sachs named the stock a top idea. The mining stock Freeport-McMoRan also gained more than 1%.

The market has made a number of record highs over the past few weeks, but earnings have been relatively modest and some strategists have pointed to poor market breadth, as measured by the performance of average stocks and the number of individual stocks making new highs as a potential problem area.

On Tuesday, the S&P 500 split roughly in half between rising and falling stocks.

However, the decreased latitude and volatility could simply be a natural pause during the summer months before the busy part of the earnings season, said Bill McMahon, chief investment officer for active equity strategies at Charles Schwab Investment Management.

“I think people are in a bit of a wait and see mode so it’s not surprising that the volatility is decreasing and the latitude is getting a bit worse,” said McMahon, adding that concerns about the spreading delta variant of Covid-19 also weighs on stocks.

Morgan Stanley’s shares rose more than 3% after the bank announced it would double its quarterly dividend. The bank also announced a $ 12 billion share buyback program. The announcement follows last week’s Federal Reserve stress tests that all 23 major banks passed. However, some other bank stocks gave up early gains and weighed on the broader indices despite increasing their own payout plans.

With the market entering the final trading days of June and the second quarter, the S&P 500 is well on its way to posting profits for the fifth straight month. The Nasdaq is approaching its seventh positive month in the past eight months. However, the Dow is in the red for the month and is well on its way to a four month winning streak.

By Monday’s close, the S&P 500 was up 14% and the Dow and Nasdaq were up 12% through 2021.

JPMorgan’s quantitative strategist Dubravkos Lakos-Bujas said on CNBC’s “Squawk Box” that the market appears to have upside potential in the short term.

“In our opinion, the growth policy background remains supportive for risk assets in general, and certainly also for equities. At the same time, the positioning is not really extended to problematic terrain. So we think there is still a runway. “… In the summer, in the next two months, I think the market will continue to break out,” said the strategist.

The Conference Board’s consumer confidence for June was higher than expected, adding to bullish readings on the economic recovery.

On Monday, the S&P 500 and Nasdaq closed at record highs thanks to strong performance from big tech stocks. However, the Dow lost 151 points due to a withdrawal from Boeing and Chevron, among others.

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