Eight of ten sectors ended in the red led by consumer discretionary sector
U.S. stocks declined on Friday, 30 August 2013 as Wall Street considered a possible U.S. strike against Syria. With the Labor Day weekend ahead and the likelihood of military action in Syria also looming, participation was very limited.
The Dow Jones Industrial Average on Friday declined as much as 78 points, but closed down 30.64 points, or 0.2%, to 14,810.31. Dow was down 4.5% for the month. S&P 500 index lost 5.21 points, or 0.3%, to 1,632.96 on Friday, and was off 3.1% for the month. The Nasdaq Composite fell 30.43 points, or 0.8%, to 3,589.86 on Friday. It slid 1% for the month.
Eight of ten sectors ended in the red with influential cyclical groups weighing on the broader market. Financials, technology, industrials, and discretionary shares lost the most with the discretionary sector leading to the downside. Consumer staples and utilities were the only advancing sectors among the 10 major industry groups.
Reviewing Friday's economic data, personal income increased 0.1% in July, down from a 0.3% increase in June and exactly what the consensus expected. Employee compensation fell 0.2% as wages and salaries declined by 0.3%. That pullback was in-line with the July employment report, which showed aggregate earnings down 0.3% in July. The drop in compensation was offset by a 0.7% increase in receipts on assets, which was primarily driven by equity gains. Spending levels were weak. Consumption grew 0.1% in July after increasing an upwardly revised 0.6% (from 0.5%) in June. The consensus expected personal spending to increase 0.3%.
The Chicago PMI increased to 53.0 in August from 51.6 in July. That was exactly what the consensus expected. Production levels weakened slightly as the index fell from 53.6 in July to 53.0 in August. The drop in production, however, was not related to a pullback in orders. New orders increased in August to 57.2, which is the highest level since May. Order backlogs remained in contraction for a third consecutive month, but improved from 42.9 in July to 46.5 in August.
Lastly, consumer sentiment was revised up to 82.1 in the final reading of the August University of Michigan Consumer Sentiment Index from 80.0 in the preliminary reading. The upward revision still leaves sentiment below the 85.1 reading in July. The consensus expected the Consumer Sentiment Index to remain at 80.0.
Crude Oil futures closed lower on Friday, 30 August 2013 with investors handing back some more of the Syrian-intervention premium as the odds of an immediate strike appeared to recede. But prices hung on to some of the gains from concerns over Syria and benefited from signs of an improved outlook for energy demand, lifting prices higher for the month. October crude oil lost $1.15, or 1.1%, to settle at $107.65 a barrel on the New York Mercantile Exchange on Friday. It gained about 2.5% for the month, its third monthly gain in a row. Prices ended 1.2% higher for the week.
Gold futures closed lower on Friday, 30 August 2013 amid fading expectations for imminent military action against Syria, though the metal posted a more than 6% gain for the month. Gold for December delivery lost $16.80, or 1.2%, to settle at $1,396.10 an ounce on the Comex division of the New York Mercantile Exchange. Prices saw a third consecutive session of declines. For the month, gold gained 6%. Silver was also hit Friday, with December futures off 63 cents, or 2.6%, to $23.51 an ounce. Tracking the most-active contracts, prices were down about 1% for the week, but jumped 20% for the month.
For every stock advancing, more than two declined on the New York Stock Exchange, where 768 million shares traded. Composite volume approached 2.7 billion.
Regular trading on Comex will resume on Tuesday, 03 September 2013 following Monday's Labor Day holiday.
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