Stock Market News For August 10, 2016

Benchmarks closed narrowly in the green as drop in oil prices and disappointing productivity data offset some of the gains in healthcare and consumer staples stocks. Strong gains in Endo International following encouraging earnings results boosted the healthcare sector. Two of the three benchmarks ended near their record highs while the Nasdaq reaching its highest level ever. However, crude oversupply concerns resulted in a decline in oil prices, which in turn weighed down energy and material stocks.

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) increased 3.76 points to close at 18,533.05. The S&P 500 rose 0.85 points to close at 2,181.74. The tech-laden Nasdaq Composite Index closed at 5,225.48 gaining more than 0.2%. However, the fear-gauge CBOE Volatility Index (VIX) increased 1.4% to settle at 11.66. A total of around 5.99 billion shares were traded on Tuesday, higher than the last 20-session average of 6.48 billion shares. Advancers outpaced declining stocks on the NYSE. For 52% stocks that advanced, 45% declined.

Endo International plc’s (ENDP) shares jumped 21.8% after the company reported second-quarter earnings of 86 cents per share beating the Zacks Consensus Estimate of 75 cents. Revenues of $920.9 million also outpaced the Zacks Consensus Estimate of $878.3 million. Endo International was the best performer among the S&P 500 companies.

Gains in Endo International led the Health Care Select Sector SPDR ETF (NYSE:XLV) to rise more than 0.2%, becoming one of the best advancer among the S&P 500 sectors. Key stocks from the sector including Bristol-Myers Squibb Company (NYSE:BMY) (BMY), Perrigo Company plc (PRGO) and Allergan (NYSE:AGN_pa) plc (AGN) increased 2.2%, 1.8% and 1.1%, respectively. The iShares Nasdaq Biotechnology ETF (IBB) advanced 0.1%.

Also, the Consumer Staples Select Sector SPDR (XLP) advanced 0.3% and was another big gainer among S&P 500 sectors. Key consumer staples stocks including Costco Wholesale Corporation (NASDAQ:COST) (COST), Constellation Brands Inc (NYSE:STZ). ( STZ), Procter & Gamble Company (NYSE:PG) (PG) and Sysco Corporation (NYSE:SYY) (SYY) increased 0.3%, 1.2%, 0.3% and 1.2%, respectively.

However, oil prices declined yesterday following worries over the persistent global supply glut. American Petroleum Institute (API) reported an increase in crude inventories. According to the report, crude inventories increased by 2.09 million barrels for the week ended Aug 5, in contrast to analysts' projections of 1 million barrels fall.

Also, the U.S. Energy Information Administration (EIA) said that it now expect domestic crude output to decrease by 700,000 barrels per day (bpd) this year as compared to the July’s forecast of820,000 bpd fall. EIA also said that the increase in oil rigs might increase production later this year. Both WTI and Brent crude fell 0.6% and 0.9% to $42.77 a barrel and $44.98 per barrel, respectively.

Decrease in oil prices led the Energy Select Sector SPDR (XLE (NYSE:XLE)) to fall 0.5%, which emerged as the biggest decliner among the S&P 500 sectors. Some of its holdings including, Range Resources Corporation (NYSE:RRC) (RRC), Chesapeake Energy Corporation (NYSE:CHK) ( CHK), Phillips 66 (NYSE:PSX) (PSX), Valero Energy Corporation (NYSE:VLO) (VLO) and Kinder Morgan (NYSE:KMI), Inc. (KMI) declined 4.6%, 4%, 2.4%, 3.1% and 1.6%, respectively.

Additionally, the Materials Select Sector SPDR ETF (XLB) decreased 0.3%. Key components from materials sector including CF Industries Holdings (NYSE:CF), Inc. ( CF), Owens-Illinois (NYSE:OI), Inc. (OI), Freeport-McMoRan Inc. (FCX), Nucor Corporation (NYSE:NUE) (NUE) and LyondellBasell Industries N.V. (LYB) fell 4.6%, 2.2%, 1.6%, 1.4% and 1.2%, respectively.

In economic news, as per the Bureau of Labor Statistics, non-farm business sector labor productivity fell 0.5% in the second quarter of 2016, in contrast to the consensus estimate of 0.5% increase. Labor productivity fell for third straight quarter, registering its longest streak of decline since 1979.

Meanwhile, the U.S. Department of Commerce announced that US wholesale inventories advanced 0.3% in June and was higher than the May’s revised increase of 0.2%.

Moreover, shares of Valeant Pharmaceuticals (NYSE:VRX) Inc. (VRX) soared 25.4% after the company affirmed its full-year guidance. Earnings per share (EPS) are expected to be in the range of $6.60-7.00 per share on revenues in the range of $9.9-10.1 billion. However, its fiscal second quarter EPS and revenues of $1.40 and $2.4 billion missed the Zacks Consensus Estimate of $1.59 and $2.592 billion, respectively.