NYSE Dow Jones finished today at:

[bigdog]

Asia markets rise, except Japan, ahead of US jobs report

Shares are mostly higher in Asia, led by a 5.8% jump in Hong Kong's Hang Seng index as Chinese markets were lifted by speculation that Beijing might begin to ease pandemic restrictions.

apnews.com

Stocks end lower as the Fed continues to fight inflation​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks racked up more losses on Wall Street and Treasury yields again rose to multiyear highs Thursday as investors looked ahead to a closely watched job market report from the government that could influence the Federal Reserve’s next move in its fight to bring down inflation.

Technology stocks led the market pullback, which came a day after the central bank raised its benchmark rate for the sixth time this year and signaled that it may need to keep hiking rates for some time before its can successfully squash the highest inflation in decades.

The S&P 500 fell 1.1%, while the Dow Jones Industrial Average dropped 0.5%. The tech-heavy Nasdaq composite closed 1.7% lower. The declines extended the major indexes’ losing streak to a fourth day. They’re each on pace for a weekly loss.

Expectations of higher rates helped push up Treasury yields, weighing on stocks. The two-year Treasury note, which tends to track expectations for future Fed moves, rose to 4.72% from 4.61% late Wednesday and is now at its highest level since 2007, according to Tradeweb.

The yield on the 10-year Treasury rose to 4.15% from 4.09% late Wednesday. The rise in the 10-year Treasury yield has prompted mortgage rates to more than double this year and it continues putting pressure on stocks

The Fed on Wednesday added another jumbo rate increase and suggested that the pace of rate hikes may slow. The central bank also indicated that interest rates might need to ultimately go even higher than previously thought in order to tame the worst inflation in decades.

The central bank’s latest three-quarters of a percentage point raise brings short-term interest rates to a range of 3.75% to 4%, its highest level in 15 years. Wall Street is evenly split on whether the central bank ultimately raises rates to a range of 5% to 5.25% or 5.25% to 5.50% next year.

Higher rates not only slow the economy by discouraging borrowing, they also make stocks look less appealing compared to lower-risk assets like bonds and CDs.

Stubbornly hot inflation has been prompting central banks around the world to also raise interest rates. On Thursday, the Bank of England announced its biggest interest rate increase in three decades. The increase is the Bank of England’s eighth in a row and the biggest since 1992.

European and Asian markets closed mostly lower.

In the U.S., the S&P 500 fell 39.80 points to 3,719.89. The Dow lost 146.51 points to close at 32,001.25. The Nasdaq slid 181.86 points to 10,342.94. Smaller company stocks also lost ground. The Russell 2000 fell 9.41 points, or 0.5%, to 1,779.73.

Technology and communication services stocks were among the biggest weights on the market. Apple fell 4.2% and Warner Bros. Discovery slid 5.6%.

Those losses kept gains in industrial, energy and other sectors in check. Boeing jumped 6.7% and Marathon Petroleum rose 3%.

Investors had been hoping for economic data signaling that the Fed might ease up on rate increases. The fear is that the Fed will go too far in slowing the economy and bring on a recession.

Hotter-than-expected data from the employment sector this week has so far signaled that the Fed has to remain aggressive. On Friday, Wall Street will get a broader update from the U.S. government’s October jobs report.

So far, hiring and wage growth have not fallen fast enough for the Fed to slow its inflation-fighting efforts. If the October data shows a stronger-than-expected rise in hiring or wages, that could put pressure on the Fed to keep raising interest rates.

The Labor Department is expected to report that nonfarm employers added 200,000 jobs last month. That would be the worst showing since December 2020, when the economy lost 115,000 jobs.

Investors will also be looking ahead to the latest data on inflation at the consumer level. That report, the consumer price index, is due out next week.

“The next two or three quarters are incredibly important in assessing how far the Federal Reserve will need to go to achieve their objective of bringing down inflation,” said Bill Northey, senior investment director at U.S. Bank Wealth Management. “Why the CPI data is so important, why the labor report is so important, is because they feed into that next six-month cycle.”

Wall Street has also been closely watching the latest company earnings reports. The reports have been mixed and many companies have warned that inflation will likely continue pressuring operations.

Booking Holdings rose 2.7% after reporting strong third-quarter financial results. Robinhood Markets climbed 8.2% after the investing app operator reported third-quarter earnings that topped Wall Street’s forecasts. Chipmaker Qualcomm fell 7.7% after giving investors a weak profit and revenue forecast.

Market watch​

ASX futures 200 index 6,834.5 down 12.5 points & 0.18% @ 06:59:57 AM

The S&P 500 fell 39.80 points to 3,719.89. The Dow lost 146.51 points to close at 32,001.25. The Nasdaq slid 181.86 points to 10,342.94. Smaller company stocks also lost ground. The Russell 2000 fell 9.41 points, or 0.5%, to 1,779.73.

The S&P 500 fell 1.1%, while the Dow Jones Industrial Average dropped 0.5%. The tech-heavy Nasdaq composite closed 1.7% lower.

 

[bigdog]

Friday was great day for all countries except Japan

Hong Kong shares soar on hopes China COVID rules may ease

TOKYO (AP) — Shares soared more than 7% in Hong Kong on Friday after a Communist Party newspaper reported that local officials were being urged not to impose overly burdensome controls to curb coronavirus infections.

apnews.com

Wall Street rallies, in fits and starts, after jobs report​

By STAN CHOE and DAMIAN J. TROISE

NEW YORK (AP) — Stocks rallied Friday, but only after yo-yoing several times, as Wall Street struggled with what to make of the latest reading on the U.S. jobs market and what it means for interest rates and the odds of a recession.

The S&P 500 climbed 1.4% after seeing an even bigger rally from the morning disappear completely, only to recover at the end of the day. The Dow Jones Industrial Average rose 1.3% after veering from a gain of 610 points to a loss of 62, while the Nasdaq composite added 1.3%.

The latest set of gyrations in what’s already been a wild year for markets followed a U.S. government report showing the unemployment rate ticked higher in October, employers added fewer jobs than they had a month earlier and gains for workers’ wages slowed a touch.

Stocks initially rallied as the data offered some hope that the Federal Reserve’s efforts to weaken the jobs market may be taking effect and may help lower the nation’s high inflation. But the slowdown was still more modest than economists expected. And it changed few minds about what’s going to happen next: The Fed will keep hiking rates toward levels rarely seen this millennium, clamping the brakes tighter on the economy and dragging on prices for stocks and other investments.

Such fears helped send the S&P 500 to its first weekly loss in the last three, despite Friday’s gain of 50.66 points to 3,770.55. The Dow rose 401.97 Friday to 32,403.22, and the Nasdaq climbed 132.31 to 10,475.25, though both also finished with losses for the week.

While Wall Street chewed over the jobs report, markets around the world bounced higher amid continued speculation that China may relax its zero-COVID strategy and invigorate what’s long been a major source of growth for the global economy.

Earlier this week, Fed Chair Jerome Powell called out a still-hot jobs market as one of the reasons the central bank may ultimately have to raise rates higher than earlier thought. Such moves could cause a recession, and it’s why investors came into Friday with such anticipation for the U.S. government’s monthly jobs report.

On the bright side for markets, some analysts pointed to the slight increase in the unemployment rate to 3.7% during October. That raised the possibility that September’s 3.5% rate may prove to be the bottom. Big tech companies like Amazon have recently announced hiring freezes or even layoffs to stay in step with what they see as a weakening economy. That could keep the job market out of a feared “wage-price spiral,” where a tight jobs market sends wages so high that it feeds into even higher inflation.

Other analysts, though, focused on the still-solid jobs market where hiring continues to top expectations. If anything, Friday’s stronger-than-forecast jobs data likely means “Fed officials are going to have to step on the brakes even harder to slow this economy and bring inflation under control,” according to Russell Price, Ameriprise chief economist.

Several investors and banks raised their expectations Friday for how high the Fed will ultimately take short-term interest rates next year, with many eyeing something above 5%. That’s a level the economy has experienced only rarely in the last two decades and a big jolt for the federal funds rate after it began this year at virtually zero.

At fund behemoth Vanguard, the investment strategy group said all of Friday’s data on jobs together offers “nothing to change Vanguard’s Fed expectations” and only increases the focus on next week’s update for how bad inflation was across the country in October.

Markets around the world wobbled in the minutes immediately following the release of the U.S. jobs data. The yield on the two-year Treasury, which tends to track expectations for action by the Fed, jerked up and down a few times before eventually easing.

Markets elsewhere had been buoyed earlier on hopes that China may soon relax anti-COVID policies that have sometimes caused entire cities to be locked down for weeks. Such a move could give a boost to the global economy when worries are high about recessions around the world because of aggressive rate hikes by central banks from the Americas to New Zealand.

Stocks in Hong Kong surged 5.4% Friday, while stocks in Shanghai jumped 2.4%. Both markets finished the week with strong gains.

The price of copper also climbed roughly 7%. A stronger Chinese economy would devour more raw materials, and shares of miner Freeport-McMoRan soared 11.5% for the biggest gain in the S&P 500.

Two casino companies that get much of their revenue from the gambling center of Macao on the southern coast of China were also among Wall Street’s stronger stocks. Las Vegas Sands climbed 6.3%, and Wynn Resorts added 6.5%.

The yield on the two-year Treasury fell to 4.68% from 4.72% late Thursday. The 10-year yield, which helps dictate rates for mortgages and other loans, edged higher to 4.16% from 4.15%.

 

[bigdog]

ASX 200 Futures​

ASX futures up 100 points or 1.46% to 6976 on Saturday

The S&P 500 climbed 1.4% after seeing an even bigger rally from the morning disappear completely, only to recover at the end of the day. The Dow Jones Industrial Average rose 1.3% after veering from a gain of 610 points to a loss of 62, while the Nasdaq composite added 1.3%.

The Dow rose 401.97 Friday to 32,403.22, and the Nasdaq climbed 132.31 to 10,475.25, though both also finished with losses for the week.

 

[bigdog]

Asian markets mixed ahead of US elections, inflation data Asian stocks are mixed ahead of the U.S. midterm elections with trading likely to stay bumpy in a week that brings new inflation data and other events that could shake markets. apnews.com Wall Street climbs ahead of Election Day, inflation data​ By DAMIAN J. TROISE and STAN CHOE Stocks rose Monday on the eve of Election Day as Wall Street looked ahead to the benefits of a possibly split government in Washington, though trading is likely to stay bumpy in a week full of events that could shake the market. The S&P 500 rose 1%, while the Dow Jones Industrial Average gained 1.3% and the Nasdaq composite added 0.9%. Analysts say many investors seem to be making bets that Republicans will take control of at least one house of Congress. With a divided government, gridlock is more likely than big, sweeping policy changes that could upend tax and spending plans. And historically, when a Democratic White House has shared power with a split or Republican Congress, stocks have seen stronger gains than usual. “The conventional wisdom that the stock market likes political gridlock is supported by the historical data in this instance,” according to Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets. Of course, that means a better-than-expected performance by Democrats in the midterm elections could hurt stocks. Investors may fear emboldened Democrats in such a scenario would push for increased spending to help the economy. That in turn could be a signal that the Federal Reserve would have to hike interest rates even higher to get inflation under control. A Republican win would also introduce its own risks. It could again encourage Republican brinksmanship around the nation’s debt limit and threaten another government shutdown, according to strategists at Morgan Stanley. Either way, markets may have to wait a while to get clarity because of the process to count votes that came in through the mail. In the meantime, Wall Street is looking ahead to a report scheduled for Thursday, when the U.S. government will show how bad inflation was across the country last month. And that will influence what’s been the main driver on Wall Street this year, much more than politics: what the Federal Reserve does on interest rates. Economists expect the report to show that the consumer price index was 8% higher in October than a year earlier, which would be a slight slowdown from September’s 8.2% inflation rate. A fourth straight month of moderating inflation from June’s 9.1% rate could offer some relief. Such a trendline could also give the Federal Reserve leeway to loosen up a bit in its campaign to hike rates aggressively to force inflation lower. The Fed has said that it may soon dial down the size of its increases to half a percentage point, after pushing through four straight mega increases of three-quarters of a point. Higher rates put the brakes on the economy by making it more expensive to buy a house, car or anything else on credit. But too-high rates also raise the risk of a recession, while also dragging on prices for stocks and all kinds of investments. And rate hikes take a notoriously long time to take full effect, though economists debate exactly how long that is. “The lags are different each cycle and for different reasons, and we just don’t know when the tightening will have the impact that was intended,” said Keith Buchanan, portfolio manager at Globalt Investments “It boils down to one question,” Buchanan said. “What impact has the tightening from the Fed had on inflation?” Even though the Fed has said that it may soon pare back the size of its increases, it is still warning markets that it may ultimately hike rates higher than expected because of just how stubborn high inflation has been. The Fed has already hiked its key overnight rate to a range of 3.75% to 4%, up from virtually zero in March, and more investors are expecting it to top 5% next year. Monday’s gains for Wall Street came despite a shaky showing for its most influential stock. Apple rose 0.4% after dropping earlier in the day. It had warned customers they’ll have to wait longer to get the latest iPhones after anti-COVID restrictions were imposed on a contractor’s factory in China. Speculation has been rising recently that China may move away from its business-damaging zero-COVID policies. If the world’s second-largest economy did, it could provide a boost to a global economy facing wide-ranging threats as central banks worldwide hike rates because of high inflation. Besides the election, inflation and China, earnings reports from U.S. companies are also pushing stock prices to swing. The reporting season for summertime profits is roughly 85% done, and S&P 500 companies are on track to deliver growth of a little more than 2%. That’s close to analysts’ forecasts, though several companies have been warning of tougher times ahead as inflation remains high and the economy appears increasingly fragile. Analysts are now forecasting a drop in S&P 500 profits for the final three months of the year, of nearly 1.5%. They had been forecasting growth of 4% at the end of September. Bond yields rose. The yield on the 10-year Treasury rose to 4.21% from 4.16% late Friday. The yield on the two-year Treasury rose to 4.73% from 4.66%. The S&P 500 gained 36.25 to 3,806.80. The Dow rose 423.78 to 32,827.00, and the Nasdaq climbed 89.27 to 10,564.52. Market watch​ ASX 200 Futures up +36.5 points or +0.53% to 6971.5 at 06:59:24 AEDT​ The S&P 500 gained 36.25 to 3,806.80. The Dow rose 423.78 to 32,827.00, and the Nasdaq climbed 89.27 to 10,564.52. The S&P 500 rose 1%, while the Dow Jones Industrial Average gained 1.3% and the Nasdaq composite added 0.9%.

 

[bigdog]

Asian shares mixed as market await vote results, price data

Asian shares are mixed as investors await the outcome of the U.S. midterm elections and a major inflation update due later in the week.

apnews.com

Wall Street rises ahead of election results, inflation data​

By DAMIAN J. TROISE and STAN CHOE

Election Day brought another rise for Wall Street, with stocks climbing Tuesday for a third straight day.

The S&P 500 rose 21.31, or 0.6%, to 3,828.11, though it flipped between an even bigger gain and a modest loss to get there. The Dow Jones Industrial Average climbed 333.83 points, or 1%, to 33,160.83, and the Nasdaq composite gained 51.68, or 0.5%, to 10,616.20.

With Americans heading to the polls across the country amid high inflation and worries about a possible recession, analysts say investors appear to be making bets for Republicans to gain control of at least one house of Congress. That combined with a Democratic White House could lead to little getting done in Washington, which may be bad for society but could also keep the status quo on economic policy. And markets tend to abhor uncertainty.

If Republicans do end up wining control of at least the House of Representatives, the ensuing reaction in financial markets could be modest, according to economists at Goldman Sachs. Stocks have already rallied in anticipation of it, with two straight gains of at least 1% before Election Day. But a surprise win by Democrats could upset the market if it leads investors to expect higher corporate taxes and other policy changes.

A Republican win could also introduce its own risks that show themselves over time. One could be that any help for the economy from Congress during a possible recession would be less likely to pass and weaker than it would otherwise be under a Congress controlled by Democrats.

Economists are gaming out what could happen in a recession because something much more impactful than control of the U.S. Senate is dominating the economy, as well as markets: high inflation and the swift interest-rate hikes the Federal Reserve is pushing through to get it under control.

That’s why the more important milestone for markets this week than Election Day may be Thursday’s upcoming report on inflation. That data will likely carry much more influence over what the Fed does with rates.

“It will continue to be front and center until we are out of the woods from this high inflationary environment,” said Bill Merz, head of capital market research at U.S. Bank Wealth Management. “The Fed doesn’t even know how far they need to go, certainly nobody else does.”

By raising rates, the Fed is intentionally slowing the economy by making it more expensive to borrow money. That in turn should hopefully stamp down inflation, which is near its most oppressive rate in four decades. The problem for markets is that high rates drag down prices for stocks and other investments while raising the risk of a recession if rates go too high.

Even though the Fed has said it may soon pare back the size of its increases, it is still warning markets that it may ultimately hike rates higher than expected because of just how stubborn high inflation has been. The Fed has already hiked its key overnight rate to a range of 3.75% to 4%, up from virtually zero in March, and more investors are expecting it to top 5% next year

A softer reading than expected on Thursday could give the Fed leeway to loosen up a bit after raising interest rates at a furious pace this year. Economists expect the report to show a continued, slight moderation from a peak set during the summer.

But a worse-than-expected reading could have the opposite effect. The Fed has already said it would prefer taking interest rates too high rather than leave them too low. That’s because it sees a recession as a less bad outcome than punishingly high and enduring inflation.

“The point though, is how long does it take to get back to a more normal inflation rate and the longer it takes, the more restrictive the Fed is compelled to be,” Merz said.

Stocks are also moving on corporate profit reports, as earnings season enters its tail end. Take-Two Interactive sank 13.7% after reporting weaker results for the latest quarter than expected.

Shares of companies entwined with the cryptocurrency economy also fell sharply, with Coinbase Global losing 10.8% and Robinhood Markets falling 19%

They dropped with crypto prices after the world’s biggest crypto exchange by daily volume, Binance, said it intends to buy one of its bigger rivals, FTX.

Binance is making the purchase to help FTX manage a crunch where users have been pulling money out amid fears about its financial strength. It’s the latest crisis of confidence to slam the crypto industry this year, as prices have tumbled in part on worries about higher interest rates.

Bitcoin at one point sank below $17,500 before pulling back to $18,267, down 12.2% from a day earlier, according to CoinDesk.

Market watch​

​ ASX 200 futures up 33 points or 0.47% to 6991 at 08:00:03-am AEDT The S&P 500 rose 21.31, or 0.6%, to 3,828.11, though it flipped between an even bigger gain and a modest loss to get there. The Dow Jones Industrial Average climbed 333.83 points, or 1%, to 33,160.83, and the Nasdaq composite gained 51.68, or 0.5%, to 10,616.20.

​ Australian dollar +0.4% to 65.05 US cents at 7.09am AEDT​ Wall Street (in late trade): S&P 500 +0.3%, Dow Jones +0.9%, Nasdaq +0.2%​ Europe: Stoxx 50 +0.8%, FTSE +0.1%, DAX +1.2%, CAC +0.4%​ Bitcoin -14.4% to $US17,895 on Bitstamp at 7.11am AEDT​ Spot gold +2.1% to $US1711.37 per ounce at 7.08am AEDT​ US oil -2.9% to $US89.10 a barrel at 7.00am AEDT​ Brent crude -2.4% to $US95.55 a barrel at 7.00am AEDT​ Iron ore -2.1% to $US85.33 per tonne (Tianjin 62% grade)​ 10-year yield: US 4.12% Australia 4.03% Germany 2.27%​

 

[bigdog]

Asian stocks follow Wall St down before US inflation update

Asian stock markets are lower ahead of a U.S. inflation update that will likely influence Federal Reserve plans for more interest rate hikes after elections left control of Congress uncertain.

apnews.com

Wall Street washout as stocks tumble, crypto dives further​

By DAMIAN J. TROISE and STAN CHOE

Stocks fell sharply Wednesday as unease flared in far-ranging corners of financial markets, and Wall Street gave back a big chunk of the gains it had built in a rally running up to Election Day.

The S&P 500 lost 2.1%, or 79.54 points, to 3,748.57 and erased most of its gain from what had been a three-day winning streak. The Dow Jones Industrial Average fell 646.89 points, or 2%, to 32,513.94, while the Nasdaq composite tumbled 263.02, or 2.5%, to 10,353.17.

Several sources of disappointment were behind the drops. Worries rose about possible spillovers into other markets from the crypto industry’s latest crisis of confidence, where prices are plunging again, while a batch of sour profit reports from big-name companies like The Walt Disney Co. also hurt stocks. There’s also still uncertainty about whether Tuesday’s elections will result in a Congress that would prevent the kinds of sweeping economic changes that make Wall Street nervous

Looming over all of it is a report scheduled for Thursday, when the U.S. government will show just how bad inflation was across the country. That reading will likely have a big effect on how much further the Federal Reserve hikes interest rates to get inflation under control. Fears about such increases have been by far the dominant force shaking Wall Street this year.

“This is like a marathon and we’re in the early part of it,” said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute.

The Federal Reserve has already hiked its key overnight interest rate up to a range of 3.75% to 4%, up from virtually zero in March, and a growing number of investors expect it to top 5% next year.

By making it more expensive for people and companies to borrow money, the Fed is intentionally slowing the economy and jobs market in hopes of stamping down inflation near its highest level in four decades. But the Fed threatens to create a recession if it goes too far, and high rates in the meantime drag down on prices for stocks and all kinds of investments.

Cryptocurrencies have felt some of the worst pain from the Fed’s whiplash move away from the record-low interest rates instituted during the pandemic’s recession. Bitcoin fell even further Wednesday, below $15,900 from its record of nearly $69,000 set last year. It’s down more than 14% over the last day.

This latest plunge for crypto, including a 17% drop for ethereum, comes amid worries about the financial strength of one of the industry’s biggest trading exchanges, FTX. A mega player in the industry, Binance, said late Wednesday it was walking away from a deal to buy its troubled rival, which needed a rescue after users began scrambling to pull their money out.

Binance said it made the move after doing its due diligence and looking at FTX’s accounting books, while also citing reports about how FTX handled its customers’ funds.

Earlier in the day, before Binance said it was nixing the deal, its CEO said that “FTX going down is not good for anyone in the industry.”

“Do not view it as a ‘win for us,’” Changpeng Zhao, who goes by his initials CZ, said in a letter to Binance employees that he posted on Twitter. “User confidence is severely shaken. Regulators will scrutinize exchanges even more.”

Stocks of companies embedded in the crypto economy also continued to sink. Robinhood Markets lost another 13.8% and is down 31.6% so far this week. Coinbase Global fell 9.5% to bring its drop for the week to 21.8%

Elsewhere on Wall Street, Disney sank 13.2% for the largest loss in the S&P 500 after reporting results for the latest quarter that fell well short of analysts’ expectations.

Facebook parent Meta Platforms was one of Wednesday’s rare bright spots for investors. It rose 5.2% after saying it will cut costs by laying off 11,000, or about 13% of its workforce, as it contends with faltering revenue and broader tech industry woes. It nevertheless is still down nearly 70% for the year so far.

The yield on the 10-year Treasury, which helps dictate rates for mortgages and other loans, fell to 4.08% from 4.13% late Tuesday. The two-year yield, which tends to more closely track expectations for Fed action, dropped to 4.60% from 4.66%.

Market watch

ASX 200 futures down 50 points or 0.72% to 6936 at 08:00:02-am AEDT

The S&P 500 lost 2.1%, or 79.54 points, to 3,748.57 and erased most of its gain from what had been a three-day winning streak. The Dow Jones Industrial Average fell 646.89 points, or 2%, to 32,513.94, while the Nasdaq composite tumbled 263.02, or 2.5%, to 10,353.17.

 

[UMike]

Pre Empting.....

WOW.......

 

[bigdog]

Asian stocks surge after lower US inflation eases rate fears

Asian stock markets have surged after U.S. inflation eased by more than expected, spurring hopes the Federal Reserve might scale down plans for more interest rate hikes.

apnews.com

Wall Street surges, Dow up 1,200 points on cooling inflation​

By STAN CHOE

Wall Street blasted off Thursday to soar to its best day in more than two years as exhilaration swept through markets after a report showed inflation in the United States eased last month by even more than expected.

The S&P 500 surged 5.5%, while the Dow Jones Industrial Average leaped 1,200 points and the Nasdaq composite packed what could be a year’s worth of gains into one day by roaring 7.4% higher.

Prices jumped for everything from metals to European stocks as investors took the data as a sign that the worst of high inflation may finally be behind us, though analysts cautioned it’s still premature to declare victory. Even bitcoin rose to claw back some of its steep plunge from prior days caused by the crypto industry’s latest crisis of confidence.

Some of the most dramatic action was in the bond market, where Treasury yields tumbled sharply as investors pared bets for how aggressive the Federal Reserve will be in hiking interest rates to get inflation under control. Such hikes have been the main reason for Wall Street’s struggles this year and are threatening a recession.

The yield on the 10-year Treasury, which helps set rates for mortgages and other loans, fell to 3.82% from 4.15%. It’s a dramatic move for the bond market, and the yield was on track for its biggest daily drop since 2009, according to Tradeweb. The two-year yield, which more closely tracks expectations for Fed action, fell to 4.32% from 4.62% and was on pace for its sharpest fall since 2008.

All the action stemmed from a U.S. government report showing that inflation slowed in October for a fourth straight month since hitting a peak of 9.1% in June. The reading of 7.7% was better than the 8% economists were expecting.

Perhaps more importantly, inflation also slowed more than expected after ignoring the effects of food and energy prices. That’s the measure the Fed pays closer attention to. So did inflation between September and October.

“The month-on-month rate of inflation is much more informative,” said Brian Jacobsen, senior investment strategist at Allspring Global Investments. “On that measure, inflation is still high, but not scary high.”

Slower inflation could keep the Fed off the most aggressive path in raising interest rates. It’s already raised its key rate to a range of 3.75% to 4%, up from virtually zero in March.

By raising rates, the Fed is intentionally trying to slow the economy and jobs market in hopes of undercutting inflation, which hit a four-decade high in the summer. The risk is that it can create a recession if it goes too far, and higher rates drag down on prices for stocks and other investments in the meantime.

Higher rates have particularly hit high-growth tech stocks, cryptocurrencies and other investments seen as the riskiest or most expensive.

Big Tech stocks were some of the most buoyant forces on Wall Street following the inflation report. Apple rose 8.9%, Microsoft climbed 8.2% and Amazon soared 12.2%.

The Nasdaq composite, which is full of tech-oriented stocks, soared to its best day since March 2020, when Wall Street was in the midst of its frenzied recovery from the crash caused by the coronavirus. The broader S&P 500, which sits at the heart of many 401(k) accounts, had its best day since April 2020.

The S&P 500 climbed 207.80 points to 3,956.37. The Dow gained 1,201.43, or 3.7%, to 33,715.37, and the Nasdaq shot up 760.97, or 7.4%, to 11,114.15.

Homebuilders and other companies in the housing industry were also strong on hopes the Fed will take it easier on rate hikes that have already sent mortgage rates to industry-punishing levels. PulteGroup jumped 13.5%, and Lennar rose 12.6% for some of the bigger gains in the S&P 500.

Slower inflation could get the Federal Reserve to downshift the size of its rate hikes at its next policy meeting in December, after it pushed through four straight mega increases of 0.75 percentage points. That could open the way for the Fed to return to the more typical increases of 0.25 percentage points before pausing hikes completely

Following Thursday’s inflation report, traders increasingly shifted into bets for the Fed to raise rates by only 0.50 percentage points next month, instead of a bigger hike.

While Thursday’s report on inflation was encouraging, analysts cautioned the Fed’s campaign against high inflation is likely still far from over. Inflation data has also given false hope before, only to reaccelerate again.

“The Fed was adamant that it won’t hit the brakes on rate hikes until inflation slows, and while the market’s rally indicates investors may see light at the end of the tunnel, it will get one more reading before its decision next month,” said Mike Loewengart, head of model portfolio construction at Morgan Stanley Global Investment Office. “Remember that even as we see a slowdown, prices remain elevated and have a long way to go before normalizing.”

Another potentially market-shaking report will hit Wall Street Friday, when the latest reading arrives on how much inflation U.S. households see coming in future years. Fed Chair Jerome Powell has said he’s paying particularly close attention to such expectations.

One of the reasons the Fed has been so aggressive about hiking rates is because it wants avoid a debilitating cycle where expectations for high inflation push people to change their behaviors in ways that lead to even higher inflation

Market watch

ASX 200 futures up 200 points or 2.88% to 7,148 at 07:59:59-am AEDT

The S&P 500 surged 5.5%, while the Dow Jones Industrial Average leaped 1,200 points and the Nasdaq composite packed what could be a year’s worth of gains into one day by roaring 7.4% higher.

The S&P 500 climbed 207.80 points to 3,956.37. The Dow gained 1,201.43, or 3.7%, to 33,715.37, and the Nasdaq shot up 760.97, or 7.4%, to 11,114.15.

 

[bigdog]

NYSE Dow Jones finished today at:

https://apnews.com/article/inflation-asia-sydney-hong-kong-stock-markets-a6c83580d8dc896d55991499c1956e0b Stocks end lower as the Fed continues to fight inflation By DAMIAN J. TROISE and ALEX VEIGA Stocks racked up more losses on Wall Street and Treasury yields again rose to multiyear highs...

www.aussiestockforums.com

Wall Street rallies for best week since June on rate hopes​

By STAN CHOE

Wall Street piled more gains Friday onto its mammoth rally from a day earlier to close out its best week since the summer.

The S&P 500 rose 0.9% a day after soaring 5.5% for its best day in more than two years. The Dow Jones Industrial Average added 32 points to its surge of more than 1,200 from a day earlier, while the Nasdaq composite jumped 1.9%.

Markets got a boost after China relaxed some of its strict anti-COVID measures, which have been hurting the world’s second-largest economy. Hopes for more growth from China helped not only stocks but also oil prices to rise, with U.S. crude gaining 2.9% to $88.96 per barrel.

The main reason for this week’s euphoria in markets was a report on Thursday showing inflation in the United States slowed by more than expected last month. That raised hopes the worst of inflation may have passed and the Federal Reserve can be less aggressive about raising interest rates to get it under control, though analysts cautioned high inflation could be slow to fall and some called Wall Street’s big rally overdone.

What the Fed does with rates is crucial for Wall Street because hikes slow the economy and can cause a recession, all while dragging down on stock prices. They’ve been the main reason for markets’ struggles this year

Perhaps just as important as how bad inflation is at the moment is how high U.S. households see it being in future years. That’s because too-high expectations can trigger a vicious cycle where people accelerate purchases and make other moves that inflame inflation further.

The Fed has said preventing such a doom loop is one of the reasons it’s moved so aggressively on rate hikes. Inflation expectations are currently high relative to history, but a preliminary report on Friday suggested they’re not moving very much.

The median expectation for inflation in the coming year among households rose to 5.1% from 5% a month earlier, according to a survey by the University of Michigan. Expectations for long-run inflation, meanwhile, ticked up to 3%. But that’s still within the same 2.9% to 3.1% range where they’ve been for 15 of the last 16 months.

High inflation helped knock down the survey’s reading for overall consumer sentiment by more than economists expected.

“The consumer is laser-focused on inflation and they’re feeling it every day,” said Brian Price, head of investment management at Commonwealth Financial Network. “I wouldn’t expect that we see any upside with regard to consumer sentiment until inflation comes under control.”

The Fed has already lifted its key overnight interest rate to a range of 3.75% to 4%, up from basically zero in March. The likely scenario is still for it to hike further into next year, and then to hold rates at that high level for some time.

The hope for markets is that a softening in inflation could mean the Fed will hold the line at a lower, less painful level for investors than it would have otherwise.

“They’ve been pretty clear all along they were going to front-load the interest rate increases,” Price said. “They need some time to evaluate the data over the next few months.”

Traders are increasingly betting the federal funds rate could top out around a range of 4.75% to 5% by early next year, according to CME Group. A week ago, they saw a higher ultimate rate as more likely, with a sizable chunk expecting something like 5.25% to 5.50%.

Bond markets were closed for trading in observance of Veterans Day. On Thursday, yields plunged as investors pared back their expectations for how aggressively the Fed will raise rates.

The S&P 500 rose 36.56 points to 3,992.93, and its 5.9% gain for the week was its third in the last four and its biggest since June. The Dow rose 32.49, or 0.1%, to 33,747.86, and the Nasdaq climbed 209.18, or 1.9%, to 11.323.33. Both also notched hefty gains for the week.

The market has routinely reacted with exaggerated swings following each month’s inflation data report, according to Jonathan Golub, chief U.S. equity strategist at Credit Suisse. And while Thursday’s report “was clearly a big positive, the market’s response appears out of sync with the size of the surprise.”

Companies that do a lot of business in China and around the region were particularly strong Friday following the relaxation of anti-COVID restrictions. Wynn Resorts rose 8.3%, and Las Vegas Sands gained 5.5%.

Tapestry rose 8.7% and Ralph Lauren rose 9.4% to also help lead the S&P 500 higher. Both companies reported stronger profits for the latest quarter than expected.

On the losing end were health care companies. Elevance Health dropped 5.8%, and Cigna fell 6%.

In the crypto market, meanwhile, prices sank again amid the industry’s latest crisis of confidence. One of the bigger trading platforms, FTX, filed for bankruptcy protection after its users began scrambling to pull out their money on fears about its financial strength and after a bigger rival nixed a deal to buy the troubled company.

The exchange and its founder are under investigation by the Department of Justice and Securities and Exchange Commission, and rivals have said FTX’s failure could dent confidence in the broader industry.

Bitcoin fell below $16,800, down 6% from a day earlier, according to CoinDesk. It set its record of nearly $69,000 almost exactly a year ago, and it was above $21,000 a week ago.

 

[bigdog]

Market watch

ASX futures up 44 points or 0.61% to 7202 on Saturday

On Friday, the S&P 500 rose 0.9% a day after soaring 5.5% for its best day in more than two years. The Dow Jones Industrial Average added 32 points to its surge of more than 1,200 from a day earlier, while the Nasdaq composite jumped 1.9%.

 

[bigdog]

Wall Street slips, gives back some of last week’s big gains

Stocks fell on Wall Street, giving back some of their huge gains made last week on hopes the worst of the nation’s inflation may finally have passed.

apnews.com

Wall Street slips, gives back some of last week’s big gains​

By DAMIAN J. TROISE and STAN CHOE

NEW YORK (AP) — Stocks fell on Wall Street Monday, giving back some of their huge gains made last week on hopes the worst of the nation’s inflation may finally have passed.

The S&P 500 fell 0.9%, or 35.68 points, to 3,957.25 after drifting between gains and losses several times through the day. The Dow Jones Industrial Average lost 0.6%, or 211.16, to 33,536.70, and the Nasdaq composite fell 1.1%, or 127.11, to 11,196.22.

The losses follow Wall Street’s best week since June, when the S&P 500 surged 5.9% after encouraging data on inflation sparked speculation the Federal Reserve may ease up on its fusillade of interest-rate hikes meant to get prices under control. Such rate hikes have raised worries about a possible recession, while also dragging down prices for stocks, bonds and cryptocurrencies.

Some analysts have called Wall Street’s recent rally overdone, including a 5.5% surge for the S&P 500 on Thursday alone, saying one report does not mean the coast is clear, even if it was encouraging. Some officials at the Federal Reserve have also urged caution, with Fed Governor Christopher Waller saying the better-than-expected reading on inflation for October “was just one data point” and that “everybody should just take a deep breath.”

Such warnings weighed on stocks Monday, as did a rise in Treasury yields. But the market also got a brief boost after Fed Vice Chair Lael Brainard gave comments that investors took as a hint that the steepest of the Fed’s rate hikes may have passed.

“The inflation data was reassuring, preliminarily,” she said. “It will probably be appropriate, soon, to move to a slower pace of rate increases.”

In each of its last four meetings, the Fed has hiked its key overnight rate by a big 0.75 percentage points, which is triple the usual amount. Bets have increased since last week’s inflation report that the Fed’s next move will be an increase of only 0.50 percentage points. While that’s still a big increase relative to history, investors are starving for any indication the Fed may ease up on its rate hikes.

Even before last week’s report on inflation, Fed Chair Jerome Powell already said such a dial down in the size of rate hikes may be imminent. But he also said the Fed nevertheless could still ultimately take rates higher than earlier expected, and that it may hold rates at that high level a while to make sure inflation stays under control.

Fed officials have been reiterating how the Fed’s campaign against high inflation still looks to be a long one.

“Quit paying attention to the pace and start paying attention to where the endpoint is going to be,” Waller said. “Until we get inflation down, that endpoint is still a ways out there.”

On Wall Street, Hasbro fell 9.9% for the largest loss in the S&P 500 index. Analysts in a BofA Global Research report raised concerns the company may be overproducing cards for its “Magic: The Gathering” game, threatening to undercut a lucrative business.

On the winning side was Moderna, which climbed 4.6% after reporting encouraging data on its bivalent vaccine targeting COVID-19.

Bond yields rose. The yield on the 10-year Treasury, which helps set mortgage rates, rose to 3.87% from 3.81% late Thursday. Bond markets were closed Friday for Veterans Day.

Crypto-related stocks kept whipsawing following the implosion last week of FTX, a major crypto trading exchange. Coinbase, another crypto exchange platform, fell 7.4%.

Several economic reports due this week could offer more clues about where inflation is heading.

On Tuesday, the government will issue its October report on prices at the wholesale level. Economists say inflation there likely slowed to 8.3% from September’s 8.5% rate for year-over-year price changes.

On Wednesday, markets will see how resilient U.S. households have been in their spending when the government gives its latest monthly update on sales at retailers.

Economists say retail sales likely grew 0.9% in October from a month earlier, a much stronger showing than September’s flat performance. The data, though, does not take inflation into account and could be a reflection of nothing more than higher prices being charged at the register.

Retailers could offer more color on that, with a long line of them scheduled to say this week how much profit they earned during the summer.

Home Depot and Walmart report earnings on Tuesday. Target reports its results on Wednesday, and Macy’s reports results on Thursday.

Market watch

ASX futures 200 down 33 points or 0.46% to 7,113.0 at 07:59:41am AEDT

The S&P 500 fell 0.9%, or 35.68 points, to 3,957.25 after drifting between gains and losses several times through the day. The Dow Jones Industrial Average lost 0.6%, or 211.16, to 33,536.70, and the Nasdaq composite fell 1.1%, or 127.11, to 11,196.22.

 

[bigdog]

Asian shares fall on jitters over missile landing in Poland

Asian shares were mostly lower Wednesday, as investors got jittery over global risks after Poland said a Russian-made missile killed two people there.

apnews.com

Stocks rise on cooling inflation data after up-and-down day​

By DAMIAN J. TROISE and STAN CHOE

NEW YORK (AP) — Stocks rose on Wall Street Tuesday following more signs the nation’s punishingly high inflation may be falling off faster than expected.

The S&P 500 climbed 0.9%, or 34.48 points, to 3,991.73, though it went on another unsettling ride to get there. A flare-up of worries about the war in Ukraine caused a brief pullback in markets during the afternoon, forcing the S&P 500 to swing from an early gain of 1.8% all the way to a loss of 0.1% before it recovered.

The Dow Jones Industrial Average veered from a gain of 450 points to a loss of 216 before closing at 33,592.92, up 56.22 points, or 0.2%. The Nasdaq composite led the market with a gain of 1.4%, or 162.19 points, to close at 11,358.41.

When Wall Street opened for trading, the overall mood was ebullience as stocks bounced following the latest data suggesting inflation continues to cool from its summertime peak. A meeting between the presidents of the world’s two largest economies also raised hopes for an easing of U.S.-Chinese tension after analysts called it better than expected.

The S&P 500 touched its highest level in two months, while Treasury yields eased on hopes a slowdown in inflation could mean the Federal Reserve’s bitter, economy-crunching medicine for it could taper as well.

But the gains for stocks disappeared following reports that apparent Russian missiles crossed into Poland, which is a member of NATO.

Prices for crude oil jumped as stock prices fell, an indication traders were building bets for aftershocks from an escalation in the war in Ukraine. Beyond the human toll, a worsening war could cause spikes in prices for oil, gas and other commodities that the region produces, which could worsen inflation.

Stocks then recovered and began climbing anew as the afternoon progressed.

“Inflation is still top of mind and market moving,” said Nate Thooft, senior portfolio manager at Manulife Investment Management. “Anything that potentially swings the inflation story, the market is keen to react.”

Such sharp hourly swings for stocks have almost become the norm on Wall Street this year, as high inflation and interest-rate hikes by the Federal Reserve have heightened fears and triggered knee-jerk reactions. “The market remains adrift looking for a good narrative that will stick but seemingly not finding it,” Thooft said.

Through Tuesday’s swings, technology stocks continued to lead the way on Wall Street.

They’re usually some of the most sensitive to changes in interest rates, as rises in rates hit hardest on stocks seen as the most expensive, most risky or forcing investors to wait the longest for big growth.

Chipmaker Nvidia rose 2.3%, and Apple gained 1.2%.

Traders have been paring their bets for how big a hike the Fed will announce at its next policy meeting in December. Such speculation started in earnest after a report last week showed inflation at the consumer level slowed more than expected in October.

On Tuesday, hopes built further after a separate report showed inflation at the wholesale level eased back to 8% in October from 8.4% a month earlier. That was even better than the 8.3% economists were expecting.

“The improvement is simply encouraging,” said Mark Hackett, chief of investment research at Nationwide. “More importantly, what it’s doing is taking universal pessimism and starting to put some holes in that theory.”

The Fed has already hiked its key overnight rate up to a range of 3.75% to 4% from virtually zero earlier this year. It has said it still plans to hike rates further and then to hold them at that high rate for a while in order to grind down inflation. The hope for markets is that the recent improvements in inflation data could mean the Fed ends up holding rates at a level that’s not as punishing for Wall Street.

Rate increases can cause a recession because they slow the economy, and they also drag down prices of stocks and other investments.

Bond yields, which have been hovering near multidecade highs, eased. The yield on the two-year Treasury fell to 4.34% from 4.40% late Monday. The yield on the 10-year Treasury, which influences mortgage rates, fell to 3.76% from 3.85%.

Investors will get more updates on inflation’s impact on businesses and consumers this week with corporate earnings from big retailers.

Walmart jumped 6.5% after reporting strong financial results, raising its profit forecast and announcing an opioid settlement.

Target reports its results on Wednesday, and Macy’s reports its results on Thursday.

Wall Street will get a broader update on retail sales Wednesday when the government releases its report for October.

Market watch

ASX futures down 2 points to 7151 at 6.30am AEDT

The S&P 500 climbed 0.9%, or 34.48 points, to 3,991.73, though it went on another unsettling ride to get there. A flare-up of worries about the war in Ukraine caused a brief pullback in markets during the afternoon, forcing the S&P 500 to swing from an early gain of 1.8% all the way to a loss of 0.1% before it recovered.

The Dow Jones Industrial Average veered from a gain of 450 points to a loss of 216 before closing at 33,592.92, up 56.22 points, or 0.2%. The Nasdaq composite led the market with a gain of 1.4%, or 162.19 points, to close at 11,358.41.

 

[bigdog]

Asian benchmarks mostly decline amid lingering China worries

Asian shares mostly declined amid concerns about the impact of China’s “zero-COVID” strategy mixed with hopes for economic activity and tourism returning to normal.

apnews.com

Wall Street slips as Target stumbles and weighs on retailers​

By DAMIAN J. TROISE and ALEX VEIGA

Retailers and technology companies led a broad slide for stocks Wednesday after a dismal financial report from Target overshadowed a positive retail sector report from the government.

The S&P 500 fell 0.8%, wiping out most of its gains from a day earlier. The Dow Jones Industrial Average fell 0.1% and the Nasdaq lost 1.5%.

Discouraging quarterly updates from Target and other retailers put investors in a selling mood, despite a report showing that U.S. retail sales remained strong last month.

Target slumped 13.1% after cutting its forecasts for the holiday season following a surprisingly big drop in its third-quarter profits. The retailer also cut its forecasts for the holiday season and said its sales slowed sharply in recent weeks.

“I think the market might be saying the broader data that we have is OK, but what Target is saying is a little more forward-looking in terms of what they expect for the holiday season, and that might not be so good,” said Willie Delwiche, investment strategist at All Star Charts.

Other retailers also helped drag the market lower. Advance Auto Parts fell 15.1% after reporting weak financial results. Best Buy slumped 8.6%. Macy’s, which reports its financial results on Thursday, fell 8.1%

Big technology companies also fell. Chipmaker Micron Technology dropped 6.7% after announcing some production cuts because of weak demand. Nvidia fell 4.5%.

All told, the S&P 500 fell 32.94 points to 3,958.79. The Dow slid 39.09 points to 33,553.83. The tech-heavy Nasdaq dropped 174.75 points to 11,183.66.

Smaller company stocks also lost ground. The Russell 2000 index fell 36.04 points, or 1.9%, to 1,853.17.

Wall Street has been closely watching the latest economic updates, including reports that consumer and wholesale prices continue to cool. Much of the market’s prior rally was due to hopes inflation is easing, which could portend less aggressive hikes for interest rates from the Federal Reserve.

The Fed has been raising interest rates in an effort to slow the economy and tame the hottest inflation in decades. Wall Street is worried that it could hit the brakes too hard on economic growth and bring on a recession.

The latest government report on retail sales for October shows that consumer spending remains strong, though it’s unclear whether that’s because of more purchases or higher prices.

Strong consumer spending is typically a good sign for the economy, but it could make the Fed’s strategy of cooling the economy more difficult. The central bank has already hiked its key overnight rate up to a range of 3.75% to 4% from virtually zero earlier this year. It has said it still plans to hike rates further and then to hold them at that high rate for a while in order to grind down inflation.

“The better-than-expected retail sales results don’t bolster the case that the Fed” can ease up on its campaign to slow the economy with high interest rates, said Tom Hainlin, national investment strategist at U.S. Bank Wealth Management.

He said resilient consumer spending could improve the possibility that the Fed manages to pull off a so-called “soft landing” with its strategy. That would involve taming inflation without throwing the economy into a recession, or at least avoiding a damaging recession

Bond yields were mixed. The yield on the 10-year Treasury, which influences mortgage rates, fell to 3.69% from 3.78% from late Tuesday. The yield on the two-year Treasury rose to 4.37% from 4.35% from late Tuesday.

Markets in Europe fell as investors watched developments in Russia’s war against Ukraine. Geopolitical tensions had flared a day earlier after a missile fell on farmland in Poland, a NATO member, killing two people. NATO’s chief and the president of Poland said there are no indications that the missile was a deliberate attack, adding that Ukraine likely launched the Soviet-era projectile as it was fending off a Russian air assault.

“There is nothing, absolutely nothing, to suggest that it was an intentional attack on Poland,” said Polish President Andrzej Duda

The conflict is hanging over the energy market. A worsening war in Ukraine could cause spikes in prices for oil, gas and other commodities that the region produces. U.S. crude oil prices initially rose, before settling 1.5% lower.

MARKET WATCH

ASX 200 futures down 36 points OR 0.5 % to 7,116 at 08:00:04 am AEDT

The S&P 500 fell 0.8%, wiping out most of its gains from a day earlier. The Dow Jones Industrial Average fell 0.1% and the Nasdaq lost 1.5%.

All told, the S&P 500 fell 32.94 points to 3,958.79. The Dow slid 39.09 points to 33,553.83. The tech-heavy Nasdaq dropped 174.75 points to 11,183.66.

 

[CityIndex]

The S&P500 looks to be building a consolidation just below its monthly R1, and it could be worth pointing out that other major indices are actually seeing similar price action.

The NASDAQ100 also appears to have run into selling pressure above its monthly R1, while the ASX200 and FTSE100’s respective rebounds have stalled at their R2s.

Of course, all trading carries risk, and there are a variety of fundamental factors driving market direction. But from a technical standpoint, this could be a sign of the post-US CPI rally topping out.

 

[eskys]

Our market looks unusual/odd today. Stocks appear to be stuck and not moving. The heat map looks ok but All Ords only up 6 points at this stage. Has malaise and lethargy set in?

 

[bigdog]

Asian stocks mixed after Wall St falls on rate hike worries

Asian stocks are mixed after Wall Street declined following indications the Federal Reserve plans to raise interest rates higher than expected to cool inflation.

apnews.com

Stocks fall as Fed signals rates need to go still higher​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks closed lower on Wall Street and Treasury yields rose Thursday afternoon after more indications from the Federal Reserve that it may need to raise interest rates much higher than many people expect to get inflation under control.

The S&P 500 fell 0.3%, with retailers and banks among the biggest weights on the benchmark index. The Dow Jones Industrial Average slipped less than 0.1%, while the Nasdaq composite closed 0.3% lower.

Decliners outnumbered gainers on the New York Stock Exchange by nearly a 2-to-1 margin. Smaller company stocks fell harder than the rest of the market, pulling the Russell 2000 index 0.8% lower.

Bond yields rose and hovered around multidecade highs. The yield on the two-year Treasury note rose to 4.45% from 4.37% late Wednesday. The yield on the 10-year Treasury, which influences rates on mortgages and other consumer loans, rose to 3.77% from 3.69% late Wednesday.

The Fed has been raising rates aggressively in order to tame inflation by applying the brakes to the economy. Investors have been hoping that more signs of easing inflation could help the central bank shift to less aggressive rate increases.

The central bank, though, has been clear about its intent to keep raising rates, possibly to unexpectedly high levels, to tame inflation. James Bullard, who leads the Federal Reserve Bank of St. Louis, reaffirmed that position in a presentation on Thursday, suggesting the Fed’s short-term rate may have to rise to a level between 5% and 7% in order to quash stubbornly hot inflation. The central bank has already raised its key rate to a range of 3.75% to 4%, up from nearly zero as recently as last March

“Bullard’s comments this morning suggesting that they need to get the fed fund (rate) between 5% and 7% was a surprise, to say the least, to markets,” said Scott Ladner, chief investment officer at Horizon Investments. “That certainly was a shock to folks and pushed us further down.”

The S&P 500 fell 12.23 points to 3,946.56. The Dow dropped 7.51 points to 33,546.32. The Nasdaq lost 38.70 points to close at 11,144.96. The Russell 2000 index fell 14.04 points to 1,839.12. The major indexes are all headed for weekly losses.

The presentation from Bullard follows reports showing that inflation is starting to ease somewhat, but still remains extremely hot as consumers continue spending amid a very strong jobs market. Strong spending and employment remain a potential bulwark against the economy slipping into a recession. It also means the Fed will likely remain aggressive and raises the risk that it will hit the brakes hard enough on the economy to actually bring on a recession.

Stock markets “got a little bit ahead of themselves” after getting encouraging reports on consumer and wholesale prices easing a bit, said Ross Mayfield, investment strategist at Baird. “But, the Fed knows they have a long way to go.”

“When you have the (Fed) statement already laying it out and someone like Bullard saying what he said, there is a little bit of jawboning markets back down and letting investors know this fight is not over.”

Outside of concerns about inflation, the market is also worried about Russia’s war in Ukraine and lockdowns in China hurting the global economy.

The conflict in Ukraine has been weighing on the energy sector and any worsening could cause spikes in prices for oil, gas and other commodities that the region produces. U.S. oil prices fell 4.6%.

China’s “zero-COVID” approach has caused a supply crunch for some of Asia’s biggest manufacturers, denting economic growth.

Markets in Asia and Europe fell.

Companies are also wrapping up the latest round of earnings reports. Macy’s jumped 15% after beating analysts’ quarterly financial forecasts and raising its earnings outlook.

Retailer Bath & Body Works soared 25.2% after reporting strong financial results.

Market watch

ASX 200 futures up 31 points or 0.43% to 7161 at 07:59:57 AEDT

The S&P 500 fell 12.23 points to 3,946.56. The Dow dropped 7.51 points to 33,546.32. The Nasdaq lost 38.70 points to close at 11,144.96.

The S&P 500 fell 0.3%, with retailers and banks among the biggest weights on the benchmark index. The Dow Jones Industrial Average slipped less than 0.1%, while the Nasdaq composite closed 0.3% lower.

 

[bigdog]

Stocks end higher on Wall Street but still fall for the week

Stocks ended higher on Wall Street but still wound up with weekly losses after several days of bumpy trading.

apnews.com

Stocks end higher on Wall Street but still fall for the week​

By DAMIAN J. TROISE and ALEX VEIGA

A late-afternoon rally on Wall Street helped stocks close higher Friday, though the major indexes still wound up finishing lower for the week after several days of bumpy trading.

The S&P 500 rose 0.5% after wavering between small gains and losses for much of the day. The Dow Jones Industrial Average rose 0.6% and the Nasdaq composite ended essentially flat after swinging between a 1% gain and an 0.8% drop.

Several big retailers made solid gains after reporting strong quarterly results and gave investors encouraging financial forecasts. Discount retailer Ross Stores surged 9.9% for the biggest gain among S&P 500 stocks, while clothing retailer Gap rose 7.6% after beating analysts’ expectations. Foot Locker climbed 8.7% after raising its profit and revenue forecast for the year.

The solid earnings from retailers cap off a shaky week for Wall Street as investors try to get a better sense of inflation’s path and its impact on consumers and businesses. Investors have been particularly anxious about the Federal Reserve’s fight against inflation and have been looking for signs that might allow the central bank to shift to less aggressive interest rate increases. That anxiety was heightened on Thursday after a Fed official suggested U.S. interest rates might have to be raised higher than expected to cool inflation.

“It’s all been the same story for a year,” said Keith Buchanan, portfolio manager at Globalt Investments. “It’s about what inflation is doing, how the Fed responds, and from there how does the consumer respond.”

The S&P 500 rose 18.78 points to 3,965.34. The Dow rose 199.37 points to 33,745.69. The Nasdaq added 1.10 points, or less than 0.1%, to close at 11,146.06.

Smaller company stocks also gained ground. The Russell 2000 rose 10.61 points, or 0.6%, to 1,849.73.

The major indexes all finished down for the week and remain sharply lower so far this year.

Trading has been choppy this month as investors have weighed company earnings reports, economic data and signals from the Federal Reserve as to what the central bank will do next in its fight to lower inflation.

The central bank has already warned that its short-term interest rate may have to rise to a more painful level than anybody had anticipated, possibly between 5% and 7%. The Fed’s benchmark rate currently stands at 3.75% to 4%, up from close to zero in March

The Fed is trying to tame the hottest inflation in decades by making borrowing more difficult and curtailing spending. Several big measures of inflation have shown that prices are easing a bit, but other economic indicators show that consumers remain resilient, as does the jobs market.

The central bank’s strategy risks sending the economy into a recession if it hits the brakes too hard on economic growth. The latest mix of inflation and economic data has Wall Street trying to gauge whether the Fed needs to keep pushing along with interest rate increases and whether it can achieve its goal without severely crimping consumer spending or employment.

The U.S. reported this week that retail sales rose 1.3% in October as Americans increase their spending at stores, restaurants, and auto dealers, a sign of consumer resilience as the holiday shopping season begins. That’s not to say consumer behavior hasn’t been affected by inflation. Major retailers say Americans are holding out for sales, refusing to pay full price, with the cost of gasoline, rent, food and almost everything else much higher than it was last year.

Most of the 11 company sectors in the benchmark S&P 500 rose, with health care and financial stocks accounting for a big share of the gains. UnitedHealth Group rose 2.9% and Charles Schwab added 2.5%.

Losses by energy and communications companies kept the market’s gains in check. Marathon Oil fell 1.6% amid a broad pullback in energy prices. U.S. crude oil settled 1.9% lower. Live entertainment promoter and venue operator Live Nation slumped 7.8%.

Several homebuilders and other real estate companies lost ground following a report showing that sales of previously occupied U.S. homes fell in October for the ninth month in a row, the latest sign that the housing market is slowing as homebuyers grapple with sharply higher mortgage rates, rising home prices and fewer properties on the market. Zillow Group fell 5.5% and homebuilder Hovnanian Enterprises slid 0.7%.

European markets closed higher. Asian markets closed mixed overnight.

Bond yields rose. The yield on the 10-year Treasury, which influences mortgage rates, rose to 3.82% from 3.77%.

 

[bigdog]

Market watch

ASX 200 futures up 36 points or 0.51% to 7192 at 19/11-Closed.

The S&P 500 rose 0.5% after wavering between small gains and losses for much of the day. The Dow Jones Industrial Average rose 0.6% and the Nasdaq composite ended essentially flat after swinging between a 1% gain and an 0.8% drop

The S&P 500 rose 18.78 points to 3,965.34. The Dow rose 199.37 points to 33,745.69. The Nasdaq added 1.10 points, or less than 0.1%, to close at 11,146.06.

 

[CityIndex]

ASX 200 futures up 36 points or 0.51% to 7192

Pretty strong rejection from the monthly R2 in early trade.

Of course all trading involves risk, but, as mentioned on Thursday, it is interesting to see the index continuing to flash warnings around this key technical level that it may be forming a swing high.

 

[bigdog]

Asian stocks mixed after Wall St slide, China virus fears

Asian stock markets are mixed after Wall Street sank and Chinese anti-virus controls fueled concern about an economic slowdown.

apnews.com

Stocks end lower on Wall Street as tech weighs down Nasdaq​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks closed lower on Wall Street Monday, as a slide in technology companies offset gains elsewhere in the market.

The S&P 500 fell 0.4% and the tech-heavy Nasdaq composite dropped 1.1%. The Dow Jones Industrial Average held up better, ending down just 0.1%

The Dow benefited from a 6.3% gain in Disney, which soared following news late Sunday that the entertainment giant had replaced CEO Bob Chapek with his predecessor, Bob Iger.

Tesla tumbled 6.8% for the biggest drop among S&P 500 stocks and briefly slumped to an intraday low of $167.54, the lowest point in two years. The electric car maker’s shares are down more than 50% this year on investor fear that CEO Elon Musk will be distracted by his $44 billion purchase of Twitter.

The market pullback adds to stock indexes’ losses from last week and followed news overnight from China, which announced its first new death from COVID-19 in nearly half a year as strict new measures are imposed in Beijing and across the country to ward against new outbreaks. China’s ongoing strict lockdown policies have been crimping economic growth in the world’s second largest economy and stressing businesses.

“Some of the negativity that we’ve seen today is largely due to the idea that demand coming out of China maybe won’t be as strong as as people expected,” said Liz Young, head of investment strategy at SoFi.

Casino operator Wynn Resorts, which has a large footprint in China, fell 2.2%. Las Vegas Sands slid 2.9%.

All told, the S&P 500 fell 15.40 points to 3,949.94. The Nasdaq slid 121.55 points to 11,024.51. The Dow slipped 45.41 points to 33,700.28.

Technology stocks were the biggest drag on the benchmark S&P 500. Apple slid 2.2% and Visa fell 2.1%.

Retailers and other companies that rely on consumer spending also weighed down the index, as did energy stocks, which followed a 0.4% dip in the price of U.S. crude oil. Target fell 3% and Exxon Mobil dropped 1.4%.

Household goods makers, banks and other areas of the market kept the losses in check. PepsiCo gained 1.9% and Capital One Financial rose 2.4%.

Smaller company stocks lost ground. The Russell 2000 index fell 10.59 points, or 0.6%, to 1,839.14.

European markets mostly fell, while Asian markets closed lower.

Bond yields fell. The yield on the 10-year Treasury, which influences mortgage rates, slipped to 3.82% from 3.83% late Friday.

Investors face a relatively quiet week. Markets in the U.S. will be closed on Thursday for Thanksgiving and will close early Friday.

The Federal Reserve will release minutes on Wednesday from its latest policy meeting and potentially give investors more insight into the central bank’s fight against inflation. The Fed remains a main focus for investors as it continues raising interest rates to fight stubbornly high prices on everything from food to clothing.

The Fed has said that it could tone down the size of its rate increase, but that it may have to ultimately raise rates to a higher-than-expected level to reach its goal of taming painfully high prices. Its benchmark rate currently stands at 3.75% to 4%, up from close to zero in March.

Wall Street is concerned that the Fed could go too far in raising interest rates, which could hit the brakes hard enough on the economy to skid it into a recession. Inflation has been easing somewhat while key points of the economy, including consumer spending and employment, remain strong.

Investors don’t have much economic news to review this week, but some late earnings and corporate updates could provide more insight into inflation’s path and ongoing impact.

Carvana fell 12.5% after saying it will slash its workforce by 8% as inflation and higher interest rates squeeze the auto market.

Electronics retailer Best Buy and discount retailer Dollar Tree will report their latest financial results on Tuesday. Farming equipment maker Deere will report its results on Wednesday.

Market watch

ASX 200 futures up 30 points or 0.4% to 7178 at 6.47am AEDT

The S&P 500 fell 0.4% and the tech-heavy Nasdaq composite dropped 1.1%. The Dow Jones Industrial Average held up better, ending down just 0.1%

All told, the S&P 500 fell 15.40 points to 3,949.94. The Nasdaq slid 121.55 points to 11,024.51. The Dow slipped 45.41 points to 33,700.28.