The stock market extended its March decline on Tuesday, but was able to end the first quarter in the green. The S&P 500 (-0.9%) lost 1.7% for the month, but added 0.4% during the first quarter. The tech-heavy Nasdaq (-0.9%) outperformed, losing 1.3% in March to narrow its Q1 gain to 3.5%. For its part, the Dow Jones Industrial Average (-1.1%) lost 2.0% in March and shed 0.3% in Q1.

 

Equity indices started the day amid broad pressure while the Dollar Index (98.31, +0.33) added to yesterday's gain. The S&P 500 tried climbing off its opening low, but daylong weakness among heavily-weighted sectors like health care (-1.5%), industrials (-1.0%), and energy (-0.9%) prevented the index from turning positive. On the flip side, the consumer discretionary sector (-0.5%) held a modest gain into the afternoon, but slipped into the red during the final hour.

 

Still, the discretionary sector ended ahead of its peers with homebuilders contributing to the relative strength after DR Horton (DHI 28.48, +0.47) was upgraded to 'Positive' from 'Neutral' at Susquehanna. Shares of DHI gained 1.7% while the iShares Dow Jones US Home Construction ETF (ITB 28.23, -0.03) surrendered its gain ahead of the close. Similarly, apparel and luxury retailers outperformed with Movado (MOV 28.49, +2.86) jumping 11.2% in reaction to better than expected results.

 

Elsewhere among cyclical sectors, industrials (-1.0%) were pressured by large cap names like Boeing (BA 150.08, -2.62) and General Electric (GE 24.81, -0.31) while the energy sector (-0.9%) lagged amid weakness in crude oil. WTI crude fell 1.9% to $47.72/bbl and locked in a 12.7% decline for the quarter. For its part, the energy sector lost 3.6% in Q1.

 

Once again, dollar strength was a headwind for oil as the Dollar Index added 0.3% for the day and ended the month higher by 2.7%. Furthermore, the index spiked more than 8.0% during the first quarter.

 

Nine of ten sectors ended the month in negative territory while health care (-1.5%) gained 0.8% in March. Biotechnology helped the sector end the month ahead of its peers, but the group contributed to today's underperformance. The iShares Nasdaq Biotechnology ETF (IBB 343.48, -7.84) lost 2.2%, but still added 1.8% in March.

 

Treasuries posted slim gains after a slow daylong climb. The 10-yr yield slipped two basis points to 1.93%. For the month, the benchmark yield fell seven basis points from 2.00%.

 

Today's participation was better than average with roughly 950 million shares changing hands at the NYSE floor.

 

Economic data included Chicago PMI, Consumer Confidence, and Case-Shiller 20-City Index:

 

The Conference Board's Consumer Confidence Index increased to 101.3 in March from an upwardly revised 98.8 (from 96.4) while the Briefing.com consensus expected the reading to hold at 96.4 

Labor market improvements catalyzed the increase in confidence as initial claims levels returned to their sub-300,000 trend over the past couple of weeks

The Chicago PMI increased to 46.3 in March from 45.8 in February while the Briefing.com consensus expected an increase to 52.0 

Chicago PMI fell from 59.4 to 45.8 in February, which was immediately blamed on extreme weather conditions. As weather conditions returned to normal in March, manufacturing activities were expected to return to their previous expansionary cycle, but that did not happen

Conditions did improve modestly, but the overall index remained firmly in contraction for a second consecutive month, meaning the pullback that began in February was likely not the result of temporary weather problems

The Case-Shiller 20-city Home Price Index for January rose 4.6%, which is what the Briefing.com consensus expected 

The previous month's increase was revised to 4.4% from 4.5%

Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET while the ADP Employment report for March (Briefing.com consensus 225K) will cross the wires at 8:15 ET. The day's data will be topped off with the 10:00 ET release of the March ISM Index (consensus 52.5) and the Construction Spending report for February (expected -0.3%).

 

Nasdaq Composite +3.5% YTD

Russell 2000 +4.0% YTD

S&P 500 +0.4% YTD

Dow Jones Industrial Average -0.3% YTD