May 22, 2025

A choppy session looked higher before a last-minute selloff left the different indexes mixed and little changed. Economic data was also mixed as Initial Jobless Claims eased 2k to 227k, while Continuing Claims increased and pushed above 1.9 million. April Existing Home Sales fell -0.5% vs. +2.7% estimated to its lowest figure since 2009 as higher mortgages put buyers on hold. Earnings were mostly better than expected but their stocks were mixed on guidance with Snowflake (SNOW), Advanced Auto Parts (AAP) and Urban Outfitters (URBN) gapping higher on results while Analog Devices (ADI) beat but sold off on disappointing guidance. Consumer Discretionary (XLY) and Technology (XLK) closed the day with modest gains, while Utilities (XLU) and Healthcare (XLV) were the weakest market sectors, the latter on a selloff in UnitedHealth Group (UNH), CVS Health (CVS) and others as Medicare and Medicaid announced increased auditing efforts. Crude oil prices were also lower as OPEC countries agreed to up production. The late selloff erased a triple-digit gain in the DJIA leaving the blue-chip index with a 1.35-point (-0.00) loss at 41859.09. The S&P 500 lost 2.60 points (-0.04%) and settled at 5842.01, while the NASDAQ added 53.09 points (+0.28%) finishing at 18925.73.

Breadth was mixed with declining issues beating advancing issues by 188 on the NYSE, while advancing issues held a 34 unit edge on the NASDAQ. Declining volume was 50% on the NYSE, but advancing volume was 57% of the NASDAQ. The VIX eased 0.59 (-2.83%) and closed at 20.28. Crude oil prices slipped 0.64 (-1.04%) and the July contract closed at $60.94 a barrel. Gold prices dropped 20.30 (-0.61%) and finished at $3293.000 an ounce. Bitcoin (BTC) closed the session at $111,120.

Investors continued to struggle with higher yields and not only in the US. Japan's 30-year bond increased to 3.17% on Thursday, which is a 25-year high. Why is that a factor? It could lead to investors selling off US Treasuries on debt concerns and reinvest in Japan's bonds which could send the rate on the 10-year Treasury above 5%. That would likely trigger a move out of equities as market participants are already concerned with higher rates.

Earnings releases to watch for on Friday include: Booz Allen Hamilton (BAH) and Buckle (BKE).

Friday's Market Moving Economic Calendar: New Home Sales.

By David L. Blake, CMT