Stock Market News For June 23, 2017

The Nasdaq finished in the green for consecutive sessions on Thursday, boosted primarily by gain in health care shares. Healthcare shares posted gain following the release of Senate’s Healthcare Bill, aimed to repeal key sections of Obama’s Affordable Care Act.

The Dow and the S&P 500 closed marginally lower, dragged down by decline in financials and consumer staples shares. Meanwhile, investors digested the weekly initial claims data released by the Labor Department.

For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.

The Dow Jones Industrial Average (DJI) declined 0.1% to close at 21,397.29. The S&P 500 fell 0.1% to close at 2,434.50. The tech-heavy Nasdaq Composite Index advanced 2.73 points to finish at 6,236.69. The Dow, the S&P 500 and Nasdaq have advanced 8.3%, 8.7% and 15.9% respectively on a year to date basis. A total of around 6.65 billion shares were traded on Thursday, lower than the last 20-session average of 6.95 billion shares. The fear-gauge CBOE Volatility Index (VIX) traded near 10.5. Advancers outnumbered declining stocks on the NYSE by a 1.41 to 1 ratio.

Healthcare Shares Boost Nasdaq

Healthcare shares moved north on Thursday after Senate released the health care Bill in an attempt to revoke and replace Obamacare. The Senate Healthcare Bill proposes to repeal key sections of Obama’s Affordable Care Act including reduction of taxes on high income earners and adjustment of subsidy to poor people for private insurance.

The new Bill won’t change the Obamacare as drastically as the House legislation passed in May, but demands significant cuts that would likely benefit the uninsured. Medicad was expanded by Obamacare, which provided health coverage to millions of low income Americans who couldn’t afford it earlier. The Senate Bill will continue Medicad expansion under Obamacare for the next three years and will roll it back in 2021. But, from now, states won’t receive an open ended funding and instead will receive a fixed amount. The Bill also seeks to stop funding Planned Parenthood, U.S.’s largest reproductive health care provider.

As a result, the broader Health Care Select Sector SPDR (XLV) advanced 1% which ultimately had a positive impact on broader markets. Some of its key holdings, including Gilead Sciences Inc (NASDAQ:GILD) and UnitedHealth Group Inc. (NYSE:UNH) advanced 4.4% and 0.9% respectively. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Financials and Consumer Staples Decline

Financials continued to decline on Thursday, dragged down by fall in shares of banks, insurance companies. Earlier, investors digested several comments made by the central bank officials. Boston Fed President Eric Rosengren expressed his concerns over low interest rates by saying that low interest rates affect financial stability. Speaking at New York University on Monday, Chicago Fed President Charles Evans raised concerns over prevailing levels of inflation and favored gradual monetary tightening.

The broader Financials Select Sector SPDR (XLF) declined 0.6%, which had an adverse impact on the broader markets. Some of its key holdings, including US Bancorp (NYSE:USB) and Goldman Sachs Group Inc (NYSE:GS) fell 1.4% and 1.2% respectively.

Meanwhile, consumer staples shares were also down, neutralizing the effects of strong gain in healthcare shares. The broader Consumer Staples Select Sector SPDR (XLP) fell 0.7%, emerging as one of the worst performing sector of S&P 500.

Economic Data

As per the Labor Department, for the week ending June 17, seasonally adjusted initial claims were recorded at 241,000 against the consensus estimate of 240,000. The figure increased by 3,000 from the earlier week's revised level. The four week moving average was recorded at 244,750, higher than the previous week's revised average figure.

Stocks that made Headlines

Eni Fortifies Position in Kazakhstan with Strategic Tie-Ups

Eni SpA (NYSE:E) has inked an agreement with JSC KazMunayGas (“KMG”) at the Foreign Investors’ Council in Astana. (Read More)

Bed Bath & Beyond Q1 Earnings & Sales Lag, Stock Dips

After making a short-lived comeback in the last quarter, Bed Bath & Beyond Inc. (NASDAQ:BBBY) reverted to a dismal surprise trend in first-quarter fiscal 2017. (Read More)

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