No economic data today but it is quadruple witching expiration, the quarterly S&P rebalancing, and we are approaching the end of the quarter.
The good news: for all the worries, the S&P 500 is up 1.02% for the quarter (as of yesterday). The bad news: without the big gains in energy, the index would be down 0.05%. Energy is the biggest sector gainer, up 9.8%. The S&P is a market cap weighted index; higher market cap stocks have a bigger weighting. The price gains this quarter have helped the weighting of energy: it's now 11.7% of the S&P 500, the highest weighting since mid-1991. Financials, with a 19.6% weighting, the largest of the 10 sectors, is down 4.5% for the quarter.
The S&P 500 rebalancing occurs once every quarter; it happens because the shares outstanding of the companies fluctuate, depending largely on buybacks and stock issuance. During the quarter, the S&P rebalances automatically when the shares outstanding of any stock changes by more than 5%; otherwise all the changes are done at the end of the quarter.
The stocks which will see the biggest dollar declines in weightings (due to buybacks) are ExxonMobil ($8 billion), Microsoft ($5.5 billion), AT&T ($2.8 billion), CVS ($2.4 billion), and Pfizer ($2.3 billion).