NYSE Dow Jones finished today at:

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Stock market today: Asian shares mixed in choppy trading after US inflation report

Asian shares were mixed in choppy trading Thursday after a report showed evidence that inflation in the United States was cooling, even if it remains too high. Shares fell in Tokyo, Sydney and Hong Kong, but rose in Seoul and Shanghai. Concerns about the Chinese economy remain a major focus...

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Stock market today: Wall Street edges higher after inflation report​

By STAN CHOE

A mixed day of trading left Wall Street slightly higher on Wednesday after a report showed inflation is making strides toward easing, even if it remains too high.

The S&P 500 rose 18.47, or 0.4%, to 4,137.64 after swinging between gains and losses through the day. The Dow Jones Industrial Average slipped 30.48, or 0.1%, to 33,531.33, while the Nasdaq composite rallied 126.89, or 1%, to 12,306.44.

Bond prices climbed after the highly anticipated report said inflation at the consumer level edged down to 4.9% last month, its lowest level in two years. That was slightly better than economists expected, and other underlying measures of inflation also came in very close to forecasts.

Because of that, Wall Street still sees the door open for the Federal Reserve to leave interest rates alone at its next meeting in June. That would be the first time it hasn’t raised rates at a meeting in more than a year, and a pause would offer some breathing room for the economy and financial markets.

“The concern coming in was that it would be hotter than feared,” said Ross Mayfield, investment strategy analyst at Baird. “While not exactly an exciting report, I think there was enough good news baked in that it shouldn’t impact the Fed or the economic trajectory all that much.”

The Fed has jacked up rates at a furious pace in hopes of driving down inflation. But high rates do that by slowing the entire economy and hitting investment prices broadly. They’ve already sent stock prices tumbling, caused turmoil in the banking system and dragged on the economy enough that many investors expect a recession to hit this year.

Following the report, traders upped the probability they see of the Fed holding rates steady in June to nearly 94%, according to data from CME Group.

Stocks that benefit the most from an easing of interest rates led the way on Wall Street, including Big Tech and other high-growth stocks. Amazon’s 3.3% rise and Microsoft’s 1.7% climb were the two biggest forces pushing the S&P 500 higher.

Of course, other economic reports will arrive before the Fed’s next meeting in the middle of June that will sway its decision. One will hit Thursday, showing how inflation fared at the wholesale level last month.

In the meantime, inflation still remains way above the Fed’s 2% target and continues to squeeze households across the economy, particularly those with the lowest incomes.

On the losing end of Wall Street, Lincoln National fell 3.9% after reporting weaker profit for the latest quarter than expected.

Airbnb dropped 10.9% despite reporting profit that matched analysts’ forecasts. It gave financial forecasts for the current quarter that were weaker than some on Wall Street expected.

The majority of companies in the S&P 500 have topped profit forecasts so far this reporting season, which is approaching its final stretch. But they’re still on pace to report an overall drop in earnings from a year earlier, which would be the second straight quarter that’s happened.

Icahn Enterprises, the partnership run by high-profile activist investor Carl Icahn, sank 15.1% after disclosing federal prosecutors asked for information related to its corporate governance and other matters.

The request from the U.S. Attorney’s office for the Southern District of New York came a day after a short-selling research firm, Hindenburg Research, accused Icahn Enterprises of inflating the value of some of its investments. Icahn called the accusations misleading and self-serving and published a rebuttal Wednesday.

In the bond market, increased hopes for a coming pause from the Fed on rates pushed yields lower.

The yield on the 10-year Treasury fell to 3.43% from 3.52%. It helps set rates for mortgages and other important loans. The two-year Treasury yield, which moves more on expectations for Fed action, fell to 3.90% from 4.03%.

Besides worries about interest rates and inflation, some corners of the bond market are also swinging on concerns about the U.S. government inching closer to a possible default on its debt. That’s never happened before, and economists warn a default could be catastrophic for the economy and financial markets.

The widespread expectation is that Congress will come to a deal before the June 1 deadline that many on Wall Street have circled, simply because the alternative would be so painful for everyone. But a meeting in the White House on Tuesday between political leaders yielded no breakthrough, and sniping continues between them.

ASX 200 expected to fall​

The Australian share market is expected to have a subdued session on Thursday despite the reasonably strong night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 12 points or 0.2% lower this morning.

A mixed day of trading left Wall Street slightly higher on Wednesday after a report showed inflation is making strides toward easing, even if it remains too high.

The S&P 500 rose 18.47, or 0.4%, to 4,137.64 after swinging between gains and losses through the day. The Dow Jones Industrial Average slipped 30.48, or 0.1%, to 33,531.33, while the Nasdaq composite rallied 126.89, or 1%, to 12,306.44.

Market Watch

 

[bigdog]

Stock market today: Asian shares mostly lower on looming worry over US banks, China growth

Asian shares are trading mostly lower on looming worries over U.S. banks and lagging demand from China, the region’s major driver of growth. Recent data reflect very low inflation and weak credit extensions in China, which indicate slowing growth. Japan's benchmark rose, but shares fell in...

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Stock market today: Wall Street edges lower following inflation data, drops for Disney, banks​

By STAN CHOE

Wall Street edged lower Thursday, weighed down by a sharp drop for The Walt Disney Co. and flaring fears about the health of some U.S. banks.

The S&P 500 lost 7.02 points, or 0.2%, to 4,130.62, with two out of every three stocks in the index falling. The Dow Jones Industrial Average lost 221.82, or 0.7%, to 33,309.51, while the Nasdaq composite rose 22.06, or 0.2%, to 12,328.51.

Disney was one of the heaviest weights dragging on the market. It dropped 8.7% after it said it lost streaming subscribers in the U.S. and Canada last quarter, surprising analysts. That was despite its earnings and revenue for the latest quarter roughly matching Wall Street’s forecasts.

Some banks beaten down by the industry’s mini-panic were also under heavy pressure again, and PacWest Bancorp sank 22.7% after saying it saw 9.5% of its deposits leave last week. It said the majority of the flight occurred in two days after news reports said the bank was talking with potential investors and partners, raising worries for its customers.

Investors have been hunting for the next possible victim in the U.S. banking industry after high interest rates helped lead to three high-profile failures since March.

Also falling was Peloton Interactive, which dropped 8.9%. It’s offering free seat posts after recalling 2.2 million of its exercise bikes. The assembly can break while someone’s riding it.

Helping to limit the losses for the overall market was a report showing inflation at the wholesale level was a bit cooler last month than economists expected. It followed a report from the prior day that showed inflation at the consumer level was also behaving largely as forecast.

The reports helped reaffirm expectations on Wall Street that the Federal Reserve will hold off on hiking interest rates again at its next meeting in June. That would be the first time that’s happened in more than a year.

The Fed has been hiking rates at a furious pace to get the worst inflation in decades under control. Inflation has come down from its peak last year, but high rates have also sent prices for investments tumbling, helped cause turmoil for the banking industry and slowed the economy enough that many investors are preparing for a recession later this year.

A separate report on Thursday said more workers filed for unemployment benefits last week than expected. That’s bad news for workers and adds to concerns about a potential recession because the job market has been one of the main pillars propping up the economy.

But a cooling labor market would also carry a benefit for the Fed, which fears that a too-hot job market could put upward pressure on inflation.

Following the reports, Treasury yields fell on expectations for a less aggressive Fed. Traders are betting on a high probability that the Fed will have to cut interest rates later this year. Rate cuts act like steroids for financial markets but would likely happen only if the economy slides into recession and needs such oomph.

The Fed, meanwhile, has said it’s unsure of its next move but does not anticipate rate cuts this year if things go as expected.

“While it’s encouraging to see inflation moderating and indications of easing labor conditions, investors should expect volatility with ongoing banking concerns and a still unresolved debt ceiling debate,” said Mike Loewengart, head of model portfolio construction at Morgan Stanley Global Investment Office.

For banks, the broader concern is that the industry’s troubles may cause a pullback in lending, which would hurt the economy. In the meantime, the U.S. government is edging closer to a June 1 deadline where it could run out of cash unless Congress allows it to borrow more. Economists say a resulting default on the U.S. government’s debt could be catastrophic for the economy.

The yield on the 10-year Treasury fell to 3.39% from 3.44% late Wednesday. It helps set rates for mortgages and other important loans. The two-year Treasury yield, which moves more on expectations for the Fed, slipped to 3.90% from 3.91%.

On the winning side of Wall Street was Robinhood Markets, which rallied 6.4% after reporting a smaller loss and better revenue for the latest quarter than expected. It also launched a way for advanced traders to make some kinds of trades 24 hours a day, five days a week.

In markets abroad, stocks in London slipped 0.1% after the Bank of England raised interest rates to their highest level since late 2008. The move was widely expected as inflation remains high in the U.K.

Stock indexes were mixed elsewhere across Europe and Asia, with most making only modest moves.

ASX 200 expected to fall​

The Australian share market looks set to end the week in a subdued fashion following a mixed night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 8 points or 0.1% lower this morning.

Wall Street edged lower Thursday, weighed down by a sharp drop for The Walt Disney Co. and flaring fears about the health of some U.S. banks.

The S&P 500 lost 7.02 points, or 0.2%, to 4,130.62, with two out of every three stocks in the index falling. The Dow Jones Industrial Average lost 221.82, or 0.7%, to 33,309.51, while the Nasdaq composite rose 22.06, or 0.2%, to 12,328.51.


Market Watch

 

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Stock market today: Wall Street slips as households get more nervous

Stocks slipped on Wall Street after a report showed that sentiment is souring among U.S. consumers. The S&P 500 lost 0.2% Friday. The Dow ended barely lower and the Nasdaq gave up 0.4%. A preliminary survey said confidence in the economy among consumers is tumbling. Treasury yields rose because...

apnews.com

Stock market today: Wall Street slips as households get more nervous​

By STAN CHOE

Another seemingly listless week on Wall Street came to a quiet close on Wall Street Friday, but big worries continue to roil under the surface.

The S&P 500 dipped 6.54 points, or 0.2%, to 4,124.08 to cap a sixth straight week where it moved by less than 1%. The Dow Jones Industrial Average slipped 8.89, or less than 0.1%, to 33,300.62, while the Nasdaq composite lost 43.76, or 0.4%, to 12,284.74.

Despite the seemingly placid moves for the overall market, big swings have swirled underneath the surface amid worries about a possible recession, high inflation and the U.S. government inching toward what could be a catastrophic default on its debt.

It’s not just Wall Street that’s concerned. Sentiment among U.S. consumers is tumbling, according to a preliminary survey by the University of Michigan. That’s a worry because strong spending by consumers has been one of the main forces preventing a recession as the economy slows.

Joanne Hsu, director of the Surveys of Consumers, pointed to the looming June 1 deadline when the U.S. government could run out of cash to pay its bills unless Congress allows it to borrow more.

“If policymakers fail to resolve the debt ceiling crisis, these dismal views over the economy will exacerbate the dire economic consequences of default,” she said in a statement.

President Joe Biden and congressional leaders postponed a meeting set for Friday on the debt limit crisis to next week. The delay was billed as a sign of positive exchanges, and staff-level talks are expected to continue through the weekend.

One area under heavy pressure this week looking to stabilize was PacWest Bancorp’s stock. It’s been under heavy scrutiny as Wall Street hunts for the next possible U.S. bank to fail following three high-profile collapses since March.

PacWest fell 3% after flipping from a gain in the morning. A day earlier, it slid sharply after disclosing a flight of deposits from the prior week. Its stock lost 21% this past week.

Banks have been bending under the weight of much higher interest rates, which have caused some customers to pull deposits in search of higher yields while also dragging down prices for the investments that the banks hold.

Rates are so high because the Federal Reserve has been hiking them at a furious pace in order to drive down inflation. Reports this week suggested inflation is continuing to moderate from its peak last year, though it remains way too high for the comfort of households and regulators.

The hope on Wall Street is that easing inflation may convince the Fed to hold off on raising rates again at its next meeting in June. That would offer some breathing room to both the economy, which has slowed under the weight of higher rates, and to financial markets, where prices began falling long ago.

One potential wild card arrived in Friday’s report on consumer sentiment. It suggested U.S. households are girding for 3.2% inflation over the long run. That’s higher than last month’s reading of 3% and the highest level since 2011.

One worry at the Fed is that if expectations for high inflation become entrenched, it could change behaviors by shoppers and others across the economy that only worsens inflation.

Treasury yields rose in the bond market following the consumer-sentiment report. The yield on the 10-year Treasury erased an earlier dip and climbed to 3.47% from 3.39% late Thursday. It helps set rates for mortgages and other important loans.

The two-year yield, which moves more on expectations for the Fed, rose to 3.99% from 3.90%.

News Corp. rose 8.5% after it reported a milder drop in profit and revenue for the latest quarter than analysts expected.

That’s been the trend this earnings reporting season. Reports have been better than feared but still weaker than a year earlier. Companies in the S&P 500 are on track to report a second straight quarter of drops in earnings per share, something that’s called an “earnings recession.”

First Solar soared 26.5% after announcing it’s purchasing Evolar AB, a European company, to accelerate its development of high efficiency tandem devices and other technologies.

On the losing end of Wall Street was Gen Digital, which fell 5.5% despite reporting stronger profit and revenue for the latest quarter than expected.

Several Big Tech stocks were also weak. They and other high-growth stocks are seen as some of the hardest hit by high interest rates. Amazon fell 1.7% and was the heaviest weight on the S&P 500.

 

[bigdog]

ASX 200 expected to edge higher​

The Australian share market is expected to edge higher this morning despite a poor finish to last week on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 7 points higher this morning.

Another seemingly listless week on Wall Street came to a quiet close on Wall Street Friday, but big worries continue to roil under the surface.

The S&P 500 dipped 6.54 points, or 0.2%, to 4,124.08 to cap a sixth straight week where it moved by less than 1%. The Dow Jones Industrial Average slipped 8.89, or less than 0.1%, to 33,300.62, while the Nasdaq composite lost 43.76, or 0.4%, to 12,284.74.

Market Watch

 

[bigdog]

My apologies for being late posting

Stock market today: Wall Street rises ahead of updates on U.S. shoppers

Wall Street ticked higher ahead of reports that will show how much a slowing economy is hurting what’s prevented a recession so far: solid spending by U.S. households. The S&P 500 rose 0.3% Monday. The Dow edged higher, while the Nasdaq rose 0.7%. Some of the sharper moves came from companies...

apnews.com

Stock market today: Wall Street rises ahead of updates on U.S. shoppers​

By STAN CHOE

Wall Street ticked higher Monday ahead of reports that will show how much a slowing economy is hurting what’s prevented a recession so far: solid spending by U.S. households.

The S&P 500 rose 12.20, or 0.3%, to 4,136.28, the latest tick higher in what’s been a listless weekslong run for the market. The Dow Jones Industrial Average added 47.98, or 0.1%, to 33,348.60, and the Nasdaq composite climbed 80.47, or 0.7%, to 12,365.21.

Some of the sharper moves came from companies announcing takeovers of rivals, including a 9.1% drop for energy company Oneok after it said it’s buying Magellan Midstream Partners. Magellan jumped 13%. But the larger market was relatively quiet as several concerns continue to drag on Wall Street.

Chief among them is the fear of a recession hitting later this year, in large part because of high interest rates meant to knock down inflation. But concerns are also rising about cracks in the U.S. banking system and the U.S. government’s inching toward a possible default on its debt as soon as June 1, which economists warn could be catastrophic.

So far, a resilient job market has helped U.S. households keep up their spending despite all the pressures. That in turn has offered a powerful pillar to prop up the economy. On Tuesday, the government will show how much sales at retailers across the country grew last month.

Several big retailers will also show how much profit they made individually during the first three months of the year, including Home Depot on Tuesday, Target on Wednesday and Walmart on Thursday.

They’re among the few companies left who have yet to report their results for the start of the year. The majority of companies in the S&P 500 have topped expectations so far, though the bar was set particularly low for them coming in.

S&P 500 companies are still on track to report a drop of 2.5% in earnings per share from a year earlier. That would be the second straight quarter they’ve seen profit drop, according to FactSet.

“These are backward-looking numbers, so it’s something we take with some value, but we’re more interested in what they’re saying going forward,” said Megan Horneman, chief investment officer at Verdence Capital Advisors.

For that, Horneman said she’s been hearing many CEOs talk about pressures on profitability and worries about a weakening economy.

“We still think a recession is likely at some point this year,” she said, pointing to the latest discouraging report about manufacturing on Monday. A survey of manufacturers in New York state plunged by much more than economists expected.

“It was pretty dismal, to say the least,” Horneman said.

As earnings reports slide out of the spotlight, the U.S. government’s debt-ceiling negotiations are shoving in. The federal government is risking its first-ever default if Congress doesn’t raise the credit limit set for federal borrowing.

Most of Wall Street expects Democrats and Republicans to come to a deal, simply because the alternative would be so disastrous for both sides. U.S. Treasurys form the bedrock of the global financial system because they’re seen as the safest possible investment on the planet.

But one worry is that politicians may not feel much urgency to reach an agreement until financial markets shake sharply to convince them of the importance.

“A debt default may not be the most likely scenario, but any prolonged debate or unexpected development has the potential to trigger higher volatility,” said Chris Larkin, managing director, trading and investing, at E-Trade from Morgan Stanley.

In the bond market, Treasury yields rose after briefly dipping during the morning.

The yield on the 10-year Treasury climbed to 3.49%, up from 3.46% late Friday. It helps set rates for mortgages and other loans. The two-year Treasury yield, which more closely tracks expectations for the Fed, held steady at 3.99%.

High interest rates have meant particular pain for some smaller- and mid-sized banks. Customers are leaving to park their deposits in money-market funds and other options paying higher yields. High rates are meanwhile knocking down the value of investments that banks made when rates were lower.

The pressures have already caused three high-profile bank failures since March, and Wall Street has been on the hunt for other potential weak links.

Several recovered a bit Monday after dropping sharply last week. PacWest Bancorp jumped 17.6% after losing 21% last week, for example.

In markets abroad, Japan’s Nikkei 225 gained 0.8% and is near its highest level since the early 1990s. It’s climbed on strong corporate earnings reports and signs that inflationary pressures might be easing.

Over the weekend, finance ministers of the Group of Seven advanced economies wrapped up a meeting in Japan with a call for vigilance given many uncertainties for the global economy.

However, they also said financial systems have shown resilience despite recent failures of several banks in the U.S. and Europe. No mention was made of the urgency of resolving the debt ceiling standoff between President Joe Biden and Republicans.

ASX 200 expected to edge lower​

The Australian share market looks set to edge higher this morning following a positive start to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 3 points lower.

Wall Street ticked higher Monday ahead of reports that will show how much a slowing economy is hurting what’s prevented a recession so far: solid spending by U.S. households.

The S&P 500 rose 12.20, or 0.3%, to 4,136.28, the latest tick higher in what’s been a listless weekslong run for the market. The Dow Jones Industrial Average added 47.98, or 0.1%, to 33,348.60, and the Nasdaq composite climbed 80.47, or 0.7%, to 12,365.21.

Market Watch

 

[bigdog]

Stock market today: Japan rises on GDP data; rest of region shaky

Asian shares are trading mixed as Japan’s benchmark jumped on the news of solid economic growth data, while the rest of the region was mired in uncertainty. Japan’s benchmark Nikkei 225 gained in early trading, while Australia’s S&P/ASX 200 dipped after a better-than-expected wage increase...

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Stock market today: Wall Street weakens as energy stocks, Home Depot weigh​

By STAN CHOE

Stocks on Wall Street sank Tuesday after Home Depot warned of flagging sales, the latest discouraging signal for an economy under pressure.

The S&P 500 fell 26.38 points, or 0.6%, to 4,109.90. The Dow Jones Industrial Average dropped 336.46, or 1%, to 33,012.14, and the Nasdaq composite slipped 22.16, or 0.2%, to 12,343.05.

Energy producers were some of the heaviest weights on the market as Exxon Mobil dropped 2.4% and Chevron fell 2.3%.

Home Depot also fell 2.2% after saying its revenue weakened by more in the latest quarter than expected. It described broad-based pressures across its business following years of big growth, and it cut its forecast for sales this fiscal year given all the uncertainty going forward.

Other big retailers are scheduled to report their results later this week, including Target and Walmart.

They’re under the microscope because resilient spending by U.S. households has been one of the main positives keeping the economy from sliding into a recession. If it buckles, a recession may be assured, and the pressure is on because measures of confidence among shoppers have been on the decline.

Manufacturing and other areas of the economy have already cracked under the weight of much higher interest rates meant to bring down inflation.

A separate report on Tuesday said that spending at U.S. retailers across the country broadly rose last month, but not by as much as economists expected.

“There’s often a gap between how people say they feel and how they spend their money, but the retail sales report shows people are beginning to cut back on big ticket items and discretionary categories like sporting goods,” said Brian Jacobsen, chief economist at Annex Wealth Management.

Economists pointed to some brighter spots underneath the surface of the report on retail sales, including stronger-than-expected gains after ignoring auto fuel costs. A separate report released later in the morning also offered some encouraging data: The nation’s industrial production unexpectedly grew in April.

Treasury yields in the bond market rose following the reports. The yield on the 10-year Treasury climbed to 3.54% from 3.51% late Monday. It helps set rates for mortgages and other important loans.

The two-year Treasury yield, which moves more on expectations for action by the Federal Reserve, rose to 4.07% from 4.01%.

The wide expectation on Wall Street is that the Fed will hold steady on interest rates in June. That would be the first time it hasn’t raised rates at a meeting in more than a year, as it fights to get inflation lower. A pause by the Fed could offer the economy and financial markets some breathing room.

Big Tech and other high-growth stocks tend to be some of the biggest beneficiaries of easier interest rates, and they helped limit Wall Street’s losses Tuesday.

Amazon gained 2%, and Google’s parent company, Alphabet, rallied 2.6%. They were the two strongest forces pushing upward on the S&P 500 when nearly 90% of the stocks in the index fell.

Also looming over Wall Street is the threat of the U.S. government defaulting on its debt for the first time. That could occur as early as June 1 unless Congress agrees to raise the credit limit set for the nation’s borrowing.

Leaders from Congress met in the White House in the afternoon to discuss the debt limit. The stakes are tremendous, and economists say failure to allow the federal government to borrow more could mean tremendous pain for both the economy and financial markets.

Most of Wall Street expects Washington to reach a deal because failure to do so would be so traumatic. But Congress has a history of waiting until the 11th hour on such matters, which could raise worries on its own.

In markets abroad, stocks in Shanghai fell 0.6%.

China’s economic recovery after the pandemic faces pressure from sluggish consumer and export demand, a government official said Tuesday, with retail sales and other activity in April weaker than expected.

Tokyo’s Nikkei 225 rose 0.7%, continuing a climb toward its highest level since the early 1990s. Stocks across Europe were modestly lower.

ASX 200 expected to drop​

The Australian share market looks set to fall again on Wednesday following a poor night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 37 points or 0.6% lower this morning.

Stocks on Wall Street sank Tuesday after Home Depot warned of flagging sales, the latest discouraging signal for an economy under pressure.

The S&P 500 fell 26.38 points, or 0.6%, to 4,109.90. The Dow Jones Industrial Average dropped 336.46, or 1%, to 33,012.14, and the Nasdaq composite slipped 22.16, or 0.2%, to 12,343.05.

Market Watch

 

[bigdog]

Asian stocks follow Wall St higher on hopes for US debt deal

Asian stock markets have followed Wall Street higher on hopes U.S. political leaders can reach agreement to avoid a potentially disastrous default on government debt. Shanghai, Tokyo, Hong Kong and Sydney advanced. Oil prices edged lower. Wall Street rallied after President Joe Biden expressed...

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Stock market today: Wall Street rises with hopes US may avoid default​

By STAN CHOE

Wall Street rallied Wednesday on hopes the U.S. government can avoid a potentially disastrous default on its debt.

The S&P 500 climbed 1.2%, with much of the gain coming after President Joe Biden said he’s confident “America will not default.” The Dow Jones Industrial Average rose 408 points, or 1.2%, while the Nasdaq composite gained 1.3%.

Biden’s comments came after House Speaker Kevin McCarthy said late Tuesday that Democrats and Republicans could reach a deal by the end of the week, though the two sides remain far apart. They’re staring down a June 1 deadline, which is when the U.S. government could run out of cash unless Congress allows it to borrow more.

A default could rock the financial system because Treasurys are assumed to be the safest possible investment on Earth, and economists say it would likely cause widespread damage across the economy.

Wednesday’s spurt came after a long, listless stretch where the S&P 500 did not move by 1% over a week, up or down, for six straight weeks. That’s its longest such stretch since 2019.

Congress has raised the nation’s debt limit many times in the past, and most have occurred without much impact on the stock market, according to Chun Wang, senior research analyst at Leuthold. The fear is something similar to 2011 occurring.

That’s when Standard & Poor’s cut its credit rating for the U.S. government as it dithered in raising the debt limit. The downgrade coincided with a debt crisis flaring in Europe, and they together sent Wall Street on a neck-snapping roller coaster for a week.

Stocks of companies that get much of their revenue from the federal government, and thus may have much to lose if it can’t pay its bills, rose Wednesday. Lockheed Martin climbed 2.1%, and Northrop Grumman gained 2.7%.

The debt negotiations are just one of the issues hanging over Wall Street. Worries are also high about a possible recession hitting later this year because of much higher interest rates meant to get painful inflation under control.

One of the main positives that’s kept the economy out of a recession so far has been resilient spending by U.S. households. They’ve continued to spend even as manufacturing, the U.S. banking system and other parts of the economy have cracked under the pressure of high rates.

Target offered some potentially encouraging data on the strength of shoppers when it said its profit fell by less last quarter than analysts feared. But it also said that it’s seeing softening sales trends early this year, and it did not raise its forecast for full-year earnings. Its stock rallied 2.6%.

A day earlier, Home Depot raised worries when it cut its financial forecasts for the year after describing pressures across its business. Walmart is the next big retailer to report its results, and it’s coming up on Thursday.

Retailers are among the last of big U.S. companies to report their profits for the start of the year. Most companies in the S&P 500 have turned in earnings that were better than analysts feared. But they’re still on pace to finish with a second straight quarter of drops in profit from year-ago levels.

Besides the “profit recession” underway, pressure on the U.S. banking industry has also raised worries on Wall Street. Investors have been hunting for the next possible weak link following three high-profile failures since March.

Banks are struggling with high interest rates, which have caused some customers to pull their deposits in search of higher yields at money-market funds and other accounts. The leap higher in interest rates over the last year has also knocked down the values of many of the investments banks hold.

Much scrutiny has been on Western Alliance Bancorp and other smaller and mid-sized banks, which has led to wild swings in their stock prices. Western Alliance recovered some of its losses after it gave an update on its deposit levels through May 12, among other data. It jumped 10.2% Wednesday, though it’s still down 41.6% for the year so far.

PacWest Bancorp, another bank under heavy scrutiny, rose 21.7% to trim its loss for the year to about 75.8%.

All told, the S&P 500 rose 48.87 points to 4,158.77. The Dow gained 408.63 to 33,420.77, and the Nasdaq added 157.51 to 12,500.57.

In the bond market, Treasury yields climbed. The yield on the 10-year Treasury rose to 3.57% from 3.54% late Tuesday. It helps set rates for mortgages and other important loans.

The two-year yield, which moves more on expectations for action by the Federal Reserve, rose to 4.16% from 4.08%.

In markets abroad, Japan’s Nikkei 225 gained 0.8% after data showed the world’s third-largest economy grew at its strongest pace since April-June 2022.

Stocks fell 2.1% in Hong Kong and were mixed amid modest movements in Europe.

ASX 200 expected to rebound​

The Australian share market is expected to have a strong session on Thursday after a stellar night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 40 points or 0.55% higher this morning

Wall Street rallied Wednesday on hopes the U.S. government can avoid a potentially disastrous default on its debt.

The S&P 500 climbed 1.2%, with much of the gain coming after President Joe Biden said he’s confident “America will not default.” The Dow Jones Industrial Average rose 408 points, or 1.2%, while the Nasdaq composite gained 1.3%.

The S&P 500 rose 48.87 points to 4,158.77. The Dow gained 408.63 to 33,420.77, and the Nasdaq added 157.51 to 12,500.57.

Market Watch

 

[bigdog]

Yesterday all markets UP

Stock market today: Wall Street rises, adding to a winning week

Stocks rose again after more companies reported better profits than expected. The S&P 500 rose 0.9% and added to its rally from the day before as hopes rise further that the U.S. government can avoid a potentially disastrous default on its debt. The Nasdaq led the market with a 1.5% gain, while...

apnews.com

Stock market today: Wall Street rises, adding to a winning week​

By STAN CHOE

Stocks rose again Thursday after more companies reported better profits than expected, while yields climbed after a Federal Reserve official cautioned the end to its interest-rate hikes may not arrive as soon as Wall Street hoped.

The S&P 500 gained 0.9%, adding to its rally from the day before as hopes rise further that the U.S. government can avoid a disastrous default on its debt. The Dow Jones Industrial Average added 115 points, or 0.3%, while the Nasdaq composite climbed 1.5%.

Video game maker Take-Two Interactive shot to the biggest gain in the S&P 500 after it forecast a huge jump in revenue for the fiscal year following this one. That stoked speculation that Grand Theft Auto VI is on the way, and its stock jumped 11.7%.

Bath & Body Works was close behind with a gain of 10.7%. It reported stronger revenue and earnings for the latest quarter than analysts expected.

Also helping to support Wall Street was another retailer, Walmart, which rose 1.3% after reporting stronger results for the latest quarter than expected. It raised its financial forecast for the full year, though it said it’s seeing shoppers remain cautious about spending.

Much scrutiny has been on the retail industry because strong spending by U.S. households has been one of the main pillars keeping the slowing economy out of a recession.

Stocks have remained remarkably resilient since early April despite a long list of worries. A major reason for that is hope the Fed would take it easier on its hikes to rates, which have slowed inflation at the expense of risking a recession and knocking down prices across financial markets.

The widespread bet was that the Fed would take a pause at its next meeting in June. But Dallas Fed President Lorie Logan cooled some of those hopes in a prepared speech for the Texas Bankers Association.

“The data in coming weeks could yet show that it is appropriate to skip a meeting,” Logan said. “As of today, though, we aren’t there yet.”

Treasury yields climbed as traders increased bets that the Fed would raise rates again at its June meeting, though the majority are still forecasting a pause.

The yield on the 10-year Treasury rose to 3.64% from 3.57% late Wednesday. The two-year yield, which moves more on expectations for the Fed, rose to 4.25% from 4.16%.

Higher rates have already slowed swaths of the economy and helped lead to three of the largest U.S. bank failures in history since March. Reports on the economy Thursday came in mixed.

One showed that fewer workers applied for unemployment benefits last week than expected. While that’s good news for workers and for a so-far solid job market, it could also result in upward pressure on inflation. That’s what the Fed has been trying desperately to lower by cranking its benchmark interest rate to the highest level since 2007.

A separate report said that manufacturing in the mid-Atlantic region is continuing to weaken, though not quite as badly as economists expected.

Cisco Systems stock swung between small gains and losses through the day after reporting stronger results for the latest quarter than expected and raising its forecast for the current quarter. Analysts said some investors may be disappointed because of worries about lower-than-expected growth in the following fiscal year. Its stock ended with a gain of 1.2%.

The majority of companies in the S&P 500 have reported stronger profits for the first three months of the year than analysts expected. But they’re still on track to report a second straight quarter of weaker earnings than a year earlier, according to FactSet.

All told, the S&P 500 gained 39.28 points to 4,198.05. The Dow rose 115.14 to 33,535.91, and the Nasdaq climbed 188.27 to 12,688.84.

In stock markets abroad, indexes rose in much of Europe and Asia after Wall Street’s rally from Wednesday spread westward. That lift came after President Joe Biden said he’s confident about reaching a deal with Republicans to allow the U.S. government to increase its credit limit and borrow more.

That could avert a potential first-ever default on Washington’s debt. The government is scheduled to run out of cash to pay its bills as soon as June 1 unless a deal is made, and economists say a U.S. federal default could have catastrophic consequences across financial markets and the economy.

In Asia, Japan’s Nikkei 225 rose 1.6% to continue a strong recent run, while Germany’s DAX in Europe returned 1.3%.

ASX 200 expected to rise​

The Australian share market looks set to end the week in a positive fashion following a strong night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 17 points or 0.2% higher this morning.

NYSE Stocks rose again Thursday after more companies reported better profits than expected, while yields climbed after a Federal Reserve official cautioned the end to its interest-rate hikes may not arrive as soon as Wall Street hoped.

The S&P 500 gained 0.9%, adding to its rally from the day before as hopes rise further that the U.S. government can avoid a disastrous default on its debt. The Dow Jones Industrial Average added 115 points, or 0.3%, while the Nasdaq composite climbed 1.5%

The S&P 500 gained 39.28 points to 4,198.05. The Dow rose 115.14 to 33,535.91, and the Nasdaq climbed 188.27 to 12,688.84

Market Watch

 

[bigdog]

Stock market today: Wall Street's best week since March stalls amid debt worries

Wall Street’s best week since March ran out of steam as worries rose about the U.S. government’s efforts to avoid a potentially disastrous default on its debt. The S&P 500 slipped 0.1% Friday, and the Dow lost 109 points. Stocks flipped from midday gains to losses after Republicans said they're...

apnews.com

Stock market today: Wall Street’s best week since March stalls amid debt worries​

By STAN CHOE

Wall Street’s best week since March ran out of steam Friday as worries rose about the U.S. government’s efforts to avoid a potentially disastrous default on its debt.

The S&P 500 slipped 6.07 points, or 0.1%, to 4,191.98. The Dow Jones Industrial Average fell 109.28, or 0.3%, to 33,426.63, while the Nasdaq composite gave up 30.94, or 0.2%, to 12,657.90.

Despite its weak Friday, the S&P 500 still managed to break out of a long, listless stretch where it failed to move by 1%, up or down, for six straight weeks. It gained 1.6%, with much of the strength earlier in the week coming on rising hopes that Washington can avoid a debt default.

Democrats and Republicans are facing down a June 1 deadline, which is when the U.S. government could run out of cash to pay its bills, unless Congress allows it to borrow more. A default on its debt would likely mean a recession for the economy, which has economists and investors both widely expecting a deal to be made.

But some of the hope ebbed Friday after a top negotiator for House Speaker Kevin McCarthy said it’s time to “ press pause ” on talks. That helped cause the S&P 500 to flip from modest midday gains to losses. It’s the latest flick in the tug of war that’s dominated Wall Street for weeks.

“Every single day, the market is just a back and forth on recession or no recession,” said Brent Schutte, chief investment officer at Northwestern Mutual Wealth Management. “That’s why we’ve been in this range bound area. Some people believe we are heading for or are in a recession, like I believe, and some don’t.”

A default on the U.S. debt would almost surely cause a recession. But helping to counterbalance those worries on Friday were hopes that the Federal Reserve may soon take it easier on its hikes to interest rates. That, in contrast, could ease the pressure on an already slowing economy.

Traders took comments made by Fed Chair Jerome Powell Friday to indicate the Fed may leave interest rates alone at its next meeting in June. That would be the first time it’s done so in more than a year after raising rates at a furious pace in hopes of driving down inflation.

High rates have helped inflation cool from its peak last summer. But they do that by hurting the economy broadly and dragging down prices of stocks, bonds and other investments. Manufacturing and other areas of the economy have already shown weakness under the weight of higher interest rates.

After Powell spoke, Treasury yields gave up some of their gains from earlier in the day as traders ratcheted back bets for another Fed rate hike in June.

The yield on the 10-year Treasury rose to 3.69% from 3.65% late Thursday. That yield helps set rates for mortgages and other important loans.

The two-year Treasury yield, which moves more on expectations for Fed action, climbed as high as 4.33% before Powell began speaking. It later fell back to 4.25%, down from 4.26% late Thursday.

Just a day earlier, traders were upping bets for a Fed hike in June. That was after Dallas Fed President Lorie Logan suggested another hike may be on the way unless more data arrives to suggest further cooling of inflation, which remains well above the Fed’s target.

On Wall Street, DXC Technology rose 2.5% for one of the bigger gains in the S&P 500 after offering a mixed earnings report.

Its revenue for the latest quarter fell shy of forecasts, but it also announced a new $1 billion program to buy back its own stock. Investors tend to like such purchases because they can goose a company’s earnings per share.

On the losing side was Foot Locker, which tumbled 27.2%. It lowered its financial forecast for the year because it’s having to mark down prices to get shoppers to buy amid what it calls a tough economic environment.

Another retailer, Ross Stores, fell 0.6% after giving a forecasted range for earnings this full year that fell short of some analysts’ projections. That was despite its sales and revenue for the latest quarter topping Wall Street’s expectations.

Much scrutiny has been on retailers this week, which also saw Home Depot, Target and Walmart report mixed results. That’s because resilient spending by U.S. households has been one of the main pillars keeping the economy from falling into a recession.

Deere also topped forecasts for revenue and earnings in the latest quarter, but its stock swung from an early gain to a drop of 1.9%. Unlike many companies on Wall Street, Deere is seeing its profit and revenue grow from year-ago levels.

The majority of companies in the S&P 500 have been reporting stronger earnings for the start of the year than analysts expected. But they’re still on track to report a second straight quarter of profit declines from year-ago levels.

Japan’s Nikkei 225 rose 0.8% to its highest close in about 33 years. Data on Japan’s consumer price index for April showed a rise of 3.4% from the previous year, indicating inflationary pressures were subsiding.

Chinese stocks struggled. Hong Kong’s Hang Seng fell 1.4% and Shanghai’s index slipped 0.4%. European markets rose.

 

[bigdog]

ASX 200 expected to edge lower​

The Australian share market is expected to edge lower this morning following a poor finish to last week on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 11 points lower on Monday.

Wall Street’s best week since March ran out of steam Friday as worries rose about the U.S. government’s efforts to avoid a potentially disastrous default on its debt.

The S&P 500 slipped 6.07 points, or 0.1%, to 4,191.98. The Dow Jones Industrial Average fell 109.28, or 0.3%, to 33,426.63, while the Nasdaq composite gave up 30.94, or 0.2%, to 12,657.90.

Market Watch

 

[bigdog]

Asian stocks mixed after more US debt talks fail to break impasse

Asian stock markets are mixed after more negotiations in Washington on government debt without a deal to avoid a potentially jarring default. Shanghai and Hong Kong declined while Tokyo and Sydney advanced. Oil prices rose. Wall Street’s benchmark S&P 500 index edged up less than 0.1% as...

apnews.com

Stock market today: Stocks are mixed as Wall Street waits to hear on Washington​

By STAN CHOE

Stocks drifted to a mixed finish Monday, as Wall Street waited for the results of a pivotal meeting meant to avoid a potentially disastrous default on the U.S. government’s debt.

The S&P 500 was at a virtual standstill after flipping between small gains and losses through the day. It edged up by 0.65, or less than 0.1%, to 4,192.63. The Dow Jones Industrial Average fell 140.05 points, or 0.4%, to 33,286.58, and the Nasdaq composite rose 62.88, or 0.5%, to 12,720.78.

The stock market is near its highest level since August, but it’s been mostly remaining within a tight range for weeks as several big worries weigh. The biggest near-term risk is the possibility of a U.S. default, something that could occur as soon as June 1.

That’s when Washington could run out of cash to pay its bills, unless Congress allows it to borrow more. Because Treasurys are seen as the safest investment on Earth, economists and investors say a default would likely trigger a recession for the economy and deep pain for financial markets.

President Joe Biden and House Speaker Kevin McCarthy were set to meet after U.S. stock markets closed to discuss the debt limit. Talks so far have been start-and-stop, with stocks rallying in the middle of last week on hopes that a deal may be progressing, only to falter Friday when negotiations hit a roadblock.

Another worry that’s hung over the market is the strength of the U.S. banking system, which has begun to crack under the weight of much higher interest rates. Three high-profile U.S. failures have shaken confidence since March, and investors have been looking for the next possible weak link.

Much scrutiny has been on PacWest Bancorp. Its stock jumped 19.5% after it agreed to sell a portfolio of real-estate construction loans with about $2.6 billion in principal still outstanding to Kennedy Wilson.

PacWest is one of the smaller and mid-sized regional banks that Wall Street highlighted in its hunt for the next possible bank to suffer a drop in confidence. Other banks collapsed after depositors pulled their cash all at once to create debilitating runs. PacWest’s stock is still down 70.2% for the year so far.

Elsewhere on Wall Street, Micron Technology dropped 2.8% as tensions heighten between China and the United States. China’s government said on Sunday Micron’s products have unspecified “serious network security risks” that could affect national security. It told users of sensitive computer equipment to stop buying Micron products.

Meta Platforms rose 1.1% after shaking off news that European regulators hit it with a record $1.3 billion privacy fine. Meta called the decision flawed and unjustified. It said it would appeal.

Meta has been on a tear this year, more than doubling in 2023 already. Other Big Tech companies have also had powerful leaps, much stronger than the rest of the market.

But that split in performance is worrying some market watchers. It’s left the index extremely top heavy, meaning its performance is more dependent on a couple handfuls of stocks than it’s been in decades.

Much of the excitement has been around artificial intelligence, but that hasn’t been enough to turn around some of Wall Street’s more pessimistic voices.

“While we believe AI is for real and will likely lead to some great efficiencies that help to fight inflation, it’s unlikely to prevent the deep earnings recession we forecast for this year,” Michael Wilson and other strategists at Morgan Stanley wrote in a report.

S&P 500 companies are in the midst of reporting a second straight quarter of profit drops from year-ago levels. The question is how much worse they will get because the economy is slowing under the weight of much higher interest rates meant to get inflation under control.

On the more optimistic side is Savita Subramanian, equity strategist at Bank of America. She raised her target for where the S&P 500 will end the year to 4,300 from 4,000. That’s not far from its current level, but she also said in a BofA Global Research report that stocks outside the behemoths at the top will likely be behind most of the gains.

She pointed to improved efficiencies at companies, which should help earnings become more stable, while acknowledging all the risks that could keep keep stocks in a long-term down market, or what’s called a “bear market”.

“For the bear case, talk to the person next to you,” she said, who can bring up everything from worries about the Federal Reserve making a mistake on interest-rate policy to the debt ceiling.

In the bond market, the 10-year Treasury yield rose to 3.71% from 3.68% late Friday. It helps set rates for mortgages and other important loans. The two-year yield, which moves more on expectations for the Fed, rose to 4.32% from 4.28%.

Hopes are high that the Fed will start taking it easier on interest rates by leaving them steady at its next meeting in June. That would be the first time it hasn’t hiked rates at a meeting in more than a year.

In stock markets abroad, Japan’s Nikkei 225 rose 0.9% to continue a big run over the last couple weeks. The Hang Seng in Hong Kong rose 1.2%, while stock indexes were mixed across Europe.

ASX 200 expected to edge higher​

The Australian share market looks set to edge higher this morning following a reasonably positive start to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 5 points or 0.1% higher.

NYSE Stocks drifted to a mixed finish Monday, as Wall Street waited for the results of a pivotal meeting meant to avoid a potentially disastrous default on the U.S. government’s debt.

The S&P 500 was at a virtual standstill after flipping between small gains and losses through the day. It edged up by 0.65, or less than 0.1%, to 4,192.63. The Dow Jones Industrial Average fell 140.05 points, or 0.4%, to 33,286.58, and the Nasdaq composite rose 62.88, or 0.5%, to 12,720.78.

The stock market is near its highest level since August, but it’s been mostly remaining within a tight range for weeks as several big worries weigh. The biggest near-term risk is the possibility of a U.S. default, something that could occur as soon as June 1.

Market Watch

 

[bigdog]

Stock market today: Asian stocks slide as debt worries mount

Asian stock markets have slid as the U.S. government crept closer to a potentially disruptive default on its debt. Tokyo’s main market index lost more than 1%. Shanghai, Hong Kong and Seoul also declined. Wall Street’s benchmark S&P 500 index fell 1.1% after Speaker Kevin McCarthy of the House...

apnews.com

Stock market today: Wall Street slides as debt worries worsen​

By STAN CHOE

Stocks slid Tuesday as the U.S. government crept closer to the edge of a potentially disastrous default on its debt.

The S&P 500 fell 1.1% after House Speaker Kevin McCarthy said, “We’re not there yet” on a deal to prevent the U.S. government from running out of cash. That followed a meeting late Monday that he and President Joe Biden called productive but ultimately ended with no agreement.

The Dow Jones Industrial Average dropped 231 points, or 0.7%, while the Nasdaq composite lost 1.3%.

Until now, the stock market has remained largely resilient even as Washington approached a June 1 deadline. That’s when the U.S. government may no longer be able to pay its bills, unless Congress allows it to borrow more. Economists and investors widely believe a default would send shockwaves through the global economy and financial markets.

The assumption on Wall Street has been for Congress to reach a deal at the 11th hour, as it’s already done several times before, because the alternative simply seems too dire for anyone to allow.

But a worry on Wall Street is that Washington may not feel urgency to act until financial markets shake hard enough to light a fire under politicians in both parties.

“There’s a theory that neither one looks like a hero until there is that scare of cascading prices,” said Keith Buchanan, senior portfolio manager at Globalt Investments. “One party or both can seem like white knights.”

Portions of Wall Street have shown more concern, particularly in the bond market where some Treasury bills are supposed to get repaid around the date of a possible default. Prices for those bonds have fallen, in part because of the debt-ceiling worries, which in turn has pushed up their yields.

But the stock market hasn’t shown as much concern. Buchanan said that may be because it’s difficult to know how prices across different markets would react to something that’s never happened before and was once unthinkable.

He said he hasn’t made any moves to investments he oversees because of fears of a default, at least not yet.

“I think everyone’s taking it moment by moment,” he said. “Every minute that goes by raises the urgency.”

The worries about the debt ceiling are coming on top of concerns that the slowing economy could be heading for a recession, even without a default. A preliminary report released Tuesday morning suggested the economy remains split, with growth for travel and other service businesses strengthening while manufacturing remains under pressure.

“The US economic expansion gathered further momentum in May, but an increasing dichotomy is evident,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.

On Wall Street, AutoZone dropped 6% after reporting weaker growth in revenue for the latest quarter than analysts expected. It pointed to a slower-than-expected March.

Electric vehicle maker Lordstown Motors fell 5.3% to 28 cents after it announced a reverse stock split in order to boost its share price. Investors will get one new share for every 15 they currently hold. Its stock has remained below $1 since mid-March.

On the winning side of Wall Street was Lowe’s, which rose 1.7% after reporting stronger profit and revenue for the latest quarter than analysts expected. But it also cut its financial forecasts for the year partly because of lower-than-expected sales to do-it-yourself customers.

Retailers are among the last companies to report their results for the first three months of the year, and most companies have been beating expectations. Retailers in particular have gotten lots of attention because resilient spending by U.S. households has been one of the main positives keeping the economy out of a recession.

Manufacturing and other areas of the economy are struggling under the weight of much higher interest rates meant to get inflation under control.

High interest rates have also meant stress for the U.S. banking system. Three high-profile bank failures since March have rattled the system, and Wall Street has been on the hunt for the next bank that could suffer a debilitating drop in confidence by its customers.

Some of the heaviest scrutiny has been on PacWest Bancorp, but it rallied for a second day after announcing the sale of a $2.6 billion portfolio of real-estate construction loans. It rose another 7.9% after jumping 19.5% Monday.

Other banks also strengthened, including a 4.6% jump for Zions Bancorp.

All told, the S&P 500 lost 47.05 points to 4,145.58. The Dow dropped 231.07 to 33,055.51, and the Nasdaq lost 160.53 to 12,560.25.

In the bond market, the 10-year Treasury yield ticked down to 3.70% from 3.72% late Monday. It helps set rates for mortgages and other important loans.

The two-year yield, which moves more on expectations for the Fed, inched up to 4.34% from 4.32%.

Most stock markets abroad fell, including a 1.3% drop for Paris and a 1.5% slide for Shanghai.

ASX 200 expected to drop​

The Australian share market looks set to fall again on Wednesday following a disappointing night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 35 points or 0.45% lower this morning.

NYSE Stocks slid Tuesday as the U.S. government crept closer to the edge of a potentially disastrous default on its debt.

The S&P 500 fell 1.1% after House Speaker Kevin McCarthy said, “We’re not there yet” on a deal to prevent the U.S. government from running out of cash. That followed a meeting late Monday that he and President Joe Biden called productive but ultimately ended with no agreement.

The Dow Jones Industrial Average dropped 231 points, or 0.7%, while the Nasdaq composite lost 1.3%.

The S&P 500 lost 47.05 points to 4,145.58. The Dow dropped 231.07 to 33,055.51, and the Nasdaq lost 160.53 to 12,560.25.


Market Watch

 

[bigdog]

Stock market today: Asian shares extend losses, while Japan's Nikkei pushes higher

Shares are mostly lower in after worries about the U.S. economy pulled Wall Street lower. Japan's benchmark Nikkei 225 index advanced, extending recent gains as investors bet on higher returns from Japanese companies. On Wednesday, the S&P 500 lost 0.7% after House Speaker Kevin McCarthy said...

apnews.com

Stock market today: Wall Street sinks as stocks tumble worldwide​

Damian J. Troise and Stan Choe

Wall Street fell again Wednesday as stocks tumbled worldwide on worries about the economy.

The S&P 500 dropped 0.7% after House Speaker Kevin McCarthy said Republicans and Democrats remain “far apart” in their efforts to prevent a potentially disastrous default on the U.S. government’s debt. The main U.S. stock index is on track for its worst week in more than two months as the once-unthinkable creeps closer to possibility.

The Dow Jones Industrial Average dropped 255 points, or 0.8%, while the Nasdaq composite lost 0.6%.

Other markets around the world fell even more as discouraging figures piled up on the economy. Stock indexes tumbled 1.7% in London, 1.9% in Frankfurt and 1.6% in Hong Kong.

Inflation in the United Kingdom remains worse than expected, raising worries that the Bank of England may keep hiking interest rates and squeezing its economy. In Germany, business confidence fell in Europe’s largest economy. And in China, worries remain about a weaker-than-hoped reopening from COVID restrictions as tensions rise with the United States over technology and security.

On Wall Street, the focus is squarely on Washington, where the U.S. government could run out of cash to pay its bills as soon as June 1 unless Congress allows it to borrow more. The widespread expectation is that a default would result in tremendous economic pain.

The stock market has remained mostly resilient despite the worries. Fear has so far been concentrated in the bond market, where prices have dropped for Treasury bills due to pay out around the date of a possible default. Price drops for bonds raise their yields, and the yield on a Treasury maturing June 1 jumped to 7.22%, up by nearly 1.25 percentage points from a day before, according to Tradeweb.

The widespread belief on Wall Street has been that Congress would come to an agreement at the 11th hour, as it’s done several times before, because a default would benefit no one.

“It will sort itself out over the next couple of weeks and end up being a positive catalyst,” said Jay Hatfield, chief executive at Infrastructure Capital Advisors.

He’s recently made moves among investments he oversees to protect against drops in stock prices. But he said that was mostly because the S&P 500 recently bumped up against a level, 4,200, that it’s had a difficult time getting past.

Still, concerns are rising that Congress may not feel urgency to act unless markets fall sharply enough to force politicians’ hands. A measure of fear among stock investors on Wall Street climbed 8% and is near its highest level since March. That’s when worries were flaring hottest about the strength of the banking system, as it creaked under the weight of much higher interest rates.

Rates are so high because the Federal Reserve has yanked them up at the fastest pace in decades in hopes of getting high inflation under control. High rates do that by putting the brakes on the entire economy and hurting prices for stocks, bonds and other investments. That has many investors bracing for a recession even if Congress reaches a deal on the debt limit.

Traders are hopeful just one more hike may be on the way this summer, if any at all. Federal Reserve officials were divided earlier this month on whether to pause their rate hikes at their upcoming meeting in June, according to the minutes of their latest meeting.

If the Fed does raise rates in June, Hatfield said he expects the next move to be a rate cut, in March.

“And they should have cut them in this past March,” he said. “We have a simple rule that they’re a year behind.”

Helping to limit Wall Street’s losses were several companies that reported stronger results for the start of the year than analyst expected.

Kohl’s jumped 7.5% after reporting a surprise profit for its latest quarter, helped in part by momentum at its Sephora beauty shops. Analysts had expected it to turn in a loss

Resilient spending by U.S. consumers has helped to keep the economy out of a recession even as manufacturing and other areas struggle with higher interest rates. With the job market remaining solid, economists at Goldman Sachs said they expect consumer spending to remain a source of strength for the economy through this year.

Homebuilder Toll Brothers rose 2.1% after reporting much better results than analysts expected for the latest quarter.

Most companies have been topping expectations for the first quarter of the year, but much of that is because analysts set the bar particularly low. That has Wall Street focused even more on what companies say about their future prospects than how they performed over the past several months.

Analog Devices tumbled 7.8% despite reporting stronger profit and revenue for the latest quarter than expected. It gave a forecast for earnings in the current quarter that fell short of analysts’ expectations.

Agilent Technologies also fell 5.9% despite reporting better results than analysts expected. It cut its forecasts for earnings and sales for the full fiscal year and said the market has become increasingly challenging.

All told, the S&P 500 fell 30.34 to 4,115.24. The Dow dropped 255.59 to 32,799.92, and the Nasdaq lost 76.08 to 12,484.16.

In the bond market, the yield on the 10-year Treasury rose to 3.73% from 3.70% late Tuesday. It helps set rates for mortgages and other important loans.

The yield on the two-year Treasury, which moves more on expectations for Fed action, rose to 4.37% from 4.33%

ASX 200 expected to fall again​

The Australian share market is expected to have a tough session on Thursday after another poor night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 31 points or 0.5% lower this morning.

Wall Street fell again Wednesday as stocks tumbled worldwide on worries about the economy.

The S&P 500 dropped 0.7% after House Speaker Kevin McCarthy said Republicans and Democrats remain “far apart” in their efforts to prevent a potentially disastrous default on the U.S. government’s debt. The main U.S. stock index is on track for its worst week in more than two months as the once-unthinkable creeps closer to possibility.

The Dow Jones Industrial Average dropped 255 points, or 0.8%, while the Nasdaq composite lost 0.6%. The S&P 500 fell 30.34 to 4,115.24. The Dow dropped 255.59 to 32,799.92, and the Nasdaq lost 76.08 to 12,484.16.

Market Watch

 

[bigdog]

Stock market today: Asian markets mixed as US government debt talks push toward brink of default

Asian markets are mixed as a deadline looms for Congress to reach a deal on the U.S. government debt or face a potentially damaging default. Tokyo and Seoul rose while Shanghai and Sydney fell. Hong Kong was closed for a holiday. The S&P 500 rose 0.9% Thursday after chipmaker Nvidia gave a...

apnews.com

Stock market today: AI frenzy pulls Wall Street higher despite DC debt woes​

By Stan Choe

Wall Street’s building frenzy around artificial intelligence helped yank the stock market higher Thursday, even as worries worsen about political rancor in Washington.

The S&P 500 rallied 0.9% after chipmaker Nvidia gave a monster forecast for upcoming sales as it benefits from the tech world’s rush into AI. It helped the Nasdaq composite leap 1.7%, while the Dow Jones Industrial Average slipped 35 points, or 0.1%.

Because it’s one of Wall Street’s most valuable stocks, Nvidia’s 24.4% surge was the strongest force pushing upward on the S&P 500. Its forecast of roughly $11 billion in revenue for the current quarter blew past analysts’ expectations for less than $7.2 billion. Nvidia’s stock has already more than doubled this year, and its total value is approaching $1 trillion.

Stocks of other chip makers also charged higher after Nvidia described a race by its customers to put AI “into every product, service and business process.” Advanced Micro Devices gained 11.2%.

Some Big Tech stocks rallied, adding to recent gains fueled by excitement about AI. The field has become so hot that critics warn of a possible bubble, while supporters say it could be the latest revolution to reshape the global economy. Microsoft gained 3.8%, and Google’s parent company, Alphabet, rose 2.1%.

They helped lift indexes even as the majority of stocks fell on worries about the U.S. government edging closer to a possible default on its debt. Washington could run out of cash to pay its bills as soon as June 1, unless Congress allows it to borrow more.

The widespread expectation on Wall Street has been for Washington to reach a deal before it’s too late, as it has many times before, because a failure would likely be awful for the economy. But bitter partisanship on Capitol Hill is hurting faith and trust in the government.

Fitch said late Wednesday that it could downgrade the U.S. government’s “AAA” credit rating. It said it still expects a resolution before the U.S. Treasury runs out of cash, but it sees the risk of a mistake having risen.

“The brinkmanship over the debt ceiling, failure of the U.S. authorities to meaningfully tackle medium-term fiscal challenges that will lead to rising budget deficits and a growing debt burden signal downside risks to U.S. creditworthiness,” Fitch said.

In 2011, Standard & Poor’s cut its “AAA” credit rating for the United States following a similar political squabble about the debt limit.

Another concern rests on exactly when the “X-date” deadline will hit for the U.S. Treasury to run out of cash.

While Isaac Boltansky, BTIG director of policy research, said he sees an 11th hour deal happening, “Washington is still arguing over exactly when midnight hits, which remains our primary concern as deadlines are the only viable forcing mechanism in town.”

On the losing end of Wall Street was Dollar Tree, which fell 12%. The retailer reported weaker profit than analysts expected for the latest quarter. ustomers are shifting spending toward less profitable products, and it’s also contending with worse-than-expected theft like other retailers.

All told, the S&P 500 rose 36.04 points to 4,151.28. The Dow slipped 35.27 to 32,764.65, and the Nasdaq gained 213.93 to 12,698.09.

In the bond market, yields rallied after reports suggested the economy is in stronger shape than feared.

One said fewer workers applied for unemployment benefits last week than expected. That’s a signal the job market remains remarkably solid, even as manufacturing and other areas of the economy slow under the weight of much higher interest rates.

Another report estimated the U.S. economy grew at a 1.3% annual pace in the first three months of the year, stronger than the 1.1% earlier thought. That report also suggested inflation was a touch hotter during the start of 2023 than earlier thought.

The stronger-than-expected data helped dampen investors’ fears about a coming recession. But it could also convince the Federal Reserve to raise interest rates again next month. Traders are split on whether the Fed will take a pause in June after hiking rates at a furious pace for more than a year.

Higher rates have helped inflation to slow from its peak last summer, but they do that by slowing the entire economy and dragging on prices for stocks, bonds and other investments.

The yield on the two-year Treasury, which tends to track expectations for Fed action, jumped to 4.53% from 4.38% last Wednesday.

The 10-year yield rose to 3.81% from 3.74%. It helps set rates for mortgages and other important loans.

Stock markets abroad were mostly weaker, but the declines were milder than the prior day’s.

Germany’s DAX lost 0.3% after data showed its economy shrank in the first three months of the year, the second straight quarter that’s occurred.

Hong Kong’s Hang Seng fell 1.9% amid worries China’s economic recovery after the government relaxed pandemic restrictions is losing steam. Stocks in Shanghai slipped 0.1%.

ASX 200 expected to open flat​

The Australian share market looks set for a subdued session on Friday despite a strong night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to down 6 points or 0.1% to 7151 this morning.

Wall Street’s building frenzy around artificial intelligence helped yank the stock market higher Thursday, even as worries worsen about political rancor in Washington.

The S&P 500 rallied 0.9% after chipmaker Nvidia gave a monster forecast for upcoming sales as it benefits from the tech world’s rush into AI. It helped the Nasdaq composite leap 1.7%, while the Dow Jones Industrial Average slipped 35 points, or 0.1%.

The S&P 500 rose 36.04 points to 4,151.28. The Dow slipped 35.27 to 32,764.65, and the Nasdaq gained 213.93 to 12,698.09.

Market Watch

 

[bigdog]

NYSE will be closed in the U.S. for the Memorial Day holiday on Monday.

Stock market today: Tech leads more gains on Wall Street

Stocks rose on Wall Street, led by more gains in technology stocks as another chipmaker reported strong demand related to artificial intelligence. The S&P 500 rose 1.3% Friday, and the Nasdaq rose 2.2%. The Dow added 1%. Marvell Technology jumped 32% after saying it expects AI revenue to at...

apnews.com

Stock market today: Tech leads more gains on Wall Street​

By DAMIAN J. TROISE

Technology stocks powered solid gains for Wall Street on Friday after another chipmaker reported strong demand related to artificial intelligence.

The upbeat finish to the week for major indexes comes amid lingering anxiety over persistently high inflation, the risk of a U.S. debt default and broadly weak corporate earnings.

The S&P 500 rose, 54.17 points, or 1.3% to close at 4,205.45. It notched a small gain for the week and is in the green as May nears its close.

The Dow Jones Industrial Average rose 328.69 points, or 1%, to 33,093.34.

The tech-heavy Nasdaq notched the biggest gains, rising 277.59 points, or 2.2%, to 12,975.69. The index rose 2.5% for the week as artificial intelligence became a big focus for investors.

Marvell Technology surged a record-setting 32.4% after the chipmaker said it expects AI revenue in fiscal 2024 to at least double from the prior year. That follows Thursday’s report from fellow chipmaker Nvidia, which gave a big forecast for upcoming sales related to AI.

The revolutionary AI field has become a hot issue. Critics warn that it is a potential bubble, but supporters supporters say it could be the latest revolution to reshape the global economy. The nation’s financial watchdog, the Consumer Finance Protection Bureau, said it’s working to ensure that companies follow the law when they’re using AI.

Wall Street remains focused on Washington and ongoing negotiations for a deal to lift the U.S. government’s debt ceiling and avert a potentially calamitous default.

Officials said President Joe Biden and House Speaker Kevin McCarthy were narrowing in on a two-year budget deal that could open the door to lifting the nation’s debt ceiling. The Democratic president and Republican speaker hope to strike a budget compromise this weekend.

Wall Street and the broader economy already had a full roster of concerns before the threat of the U.S. defaulting on its debt became sharply highlighted on the list.

“Should we avoid that, and it appears that is a high probability, we come back to a trajectory of a slowing economy, still-too-high inflation and restrictive monetary policy,” said Bill Northey, senior investment director at U.S. Bank Wealth Management.

A key measure of inflation that is closely watched by the Federal Reserve ticked higher than economists expected in April.

The persistent pressure from inflation complicates the Fed’s fight against high prices. The central bank has been aggressively raising interest rates since 2022, but recently signaled it will likely forgo a rate hike when it meets in mid-June. The latest government report on inflation is raising concerns about the Fed’s next move.

Wall Street is now leaning slightly toward the potential for another quarter-point rate hike in June, according to CME’s Fedwatch tool. The Fed has already raised its benchmark interest rate 10 times in a row.

The Fed faces a difficult choice at its next meeting, wrote Brian Rose, senior US economist at UBS, in a report.

“Inflation is too high but further rate hikes could push the economy into recession,” he said.

Bond yields had been slipping just prior to the latest inflation data, but rose following the report. The yield on the 10-year Treasury, which helps set rates for mortgages and other important loans, rose to 3.80% from 3.78% just before the report was released.

Movement for the two-year Treasury yield, which tends to track expectations for Fed action, was more forceful. It jumped to 4.56% from 4.49% prior to the report.

The latest inflation data also highlighted the continued resilience of consumer spending, which has been a key bulwark, along with the strong jobs market, against a recession. The economy grew at a sluggish 1.3% annual rate from January through March and it is projected to accelerate to a 2% pace in the current April-June quarter.

The impact from inflation and worries about a recession on the horizon have been hitting corporate profits and forecasts. The latest round of company earnings is nearing a close with the profits for companies in the S&P 500 contracting about 2%. That follows a previous quarterly contraction and Wall Street expects the current quarter to end with more shrinking profits.

Beauty products company Ulta Beauty fell 13.4% after trimming its forecast for profit margins. Discount retailer Big Lots fell 13.3% after reporting a much bigger loss last quarter than analysts expected.

Investors rewarded several companies that reported strong financial results. Gap rose 12.4% after reporting a strong first-quarter profit.

Markets are heading into a long weekend and will be closed in the U.S. for the Memorial Day holiday on Monday. Investors have another busy week of economic updates ahead, including more data on consumer confidence and employment.

A LOT OF GREEN YESTERDAY IN THE CHART BELOW

 

[bigdog]

NYSE will be closed in the U.S. for the Memorial Day holiday on Monday.

​

ASX 200 expected to race higher​

The Australian share market is expected to have a stellar session following an impressive finish to last week on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 70 points or 1% higher on Monday.

NYSE the upbeat finish to the week for major indexes comes amid lingering anxiety over persistently high inflation, the risk of a U.S. debt default and broadly weak corporate earnings.

The S&P 500 rose, 54.17 points, or 1.3% to close at 4,205.45. It notched a small gain for the week and is in the green as May nears its close.

The Dow Jones Industrial Average rose 328.69 points, or 1%, to 33,093.34.

Market Watch

 

[bigdog]

NYSE will be closed yesterday for U.S. Memorial Day holiday on Monday.

Stock market today: Markets mostly higher after Biden-McCarthy deal on US debt

World shares are mostly higher after President Joe Biden and House Speaker Kevin McCarthy reached a final agreement on a deal to raise the U.S. national debt ceiling. Investors now are waiting to see if Congress will pass the measure soon enough to avert a possible default on the national debt...

apnews.com

Stock market today: Markets mostly higher after Biden-McCarthy deal on US debt​

By ELAINE KURTENBACH

World shares were mostly higher Monday after President Joe Biden and House Speaker Kevin McCarthy reached a final agreement on a deal to raise the U.S. national debt ceiling, though the measure requires approval by Congress.

Paris, Frankfurt, Tokyo, Sydney and Shanghai advanced while Hong Kong fell. Markets in London and Seoul were closed for a holiday and U.S. markets will be closed Monday for Memorial Day.

The agreement on the U.S. debt eased what had been a potentially huge threat to markets worldwide. Biden and McCarthy worked over the weekend to try to ensure enough support in Congress to pass the measure before a June 5 deadline and avert a disruptive federal default.

“Markets are so far reacting cautiously. Buoyed, but cautious,” Clifford Bennett, chief economist at ACY Securities, said in a commentary.

“This agreement merely rolls the issue to potentially more politically friendly times post the Presidential election in two years. Nothing is certain in this regard, and it is possible resolution will be even more difficult then, than it has been on this occasion,” Bennett sai

Germany’s DAX rose 0.2% to 16,010.98 and the CAC40 in Paris edged 0.1% higher. The futures for the Dow Jones Industrial Average and the S&P 500 were 0.3% higher.

In Asian trading, Tokyo’s Nikkei 225 index jumped about 2% early on but closed 1% higher, at 31,233.54. The S&P/ASX 200 in Sydney jumped 0.9% to 7,217.40. The Shanghai Composite index added 0.3% to 3,221.45.

In Hong Kong, the Hang Seng slipped 1% to 18,551.11.

Taiwan’s benchmark gained 0.8% while India’s added 0.5%.

Investors have another busy week of U.S. economic updates ahead, including data on consumer confidence and employment.

On Friday, technology stocks powered solid gains for Wall Street. Chipmaker Marvell Technology surged a record-setting 32.4% after the chipmaker said it expects AI revenue in fiscal 2024 to at least double from the prior year. On Thursday, fellow chipmaker Nvidia soared when it forecast huge upcoming sales related to AI.

The S&P 500 rose 1.3% and the Dow industrials gained 1%. The tech-heavy Nasdaq notched the biggest gains, surging 2.2%. The index rose 2.5% for the week.

The revolutionary AI field has become a hot issue. Critics warn that it is a potential bubble, but supporters supporters say it could be the latest revolution to reshape the global economy. The nation’s financial watchdog, the Consumer Finance Protection Bureau, said it’s working to ensure that companies follow the law when they’re using AI.

Wall Street and the broader economy already had a full roster of concerns before the threat of the U.S. defaulting on its debt became sharply highlighted on the list.

A key measure of inflation that is closely watched by the Federal Reserve ticked higher than economists expected in April.

The persistent pressure from inflation complicates the Fed’s fight against high prices. The central bank has been aggressively raising interest rates since 2022, but recently signaled it will likely forgo a rate hike when it meets in mid-June. The latest government report on inflation is raising concerns about the Fed’s next move.

The latest inflation data also highlighted the continued resilience of consumer spending, which has been a key bulwark, along with the strong jobs market, against a recession. The economy grew at a sluggish 1.3% annual rate from January through March and it is projected to accelerate to a 2% pace in the current April-June quarter.

The impact from inflation and worries about a recession on the horizon have been hitting corporate profits and forecasts. The latest round of company earnings is nearing a close with the profits for companies in the S&P 500 contracting about 2%.

In other trading Monday, U.S. benchmark crude oil added 14 cents to $72.81 per barrel in electronic trading on the New York Mercantile Exchange. It picked up 84 cents to $72.67 per barrel on Friday.

Brent crude, the standard for international trading, advanced 5 cents to $77.03 per barrel.

The dollar slipped to 140.26 Japanese yen from 140.59 yen. The euro fell to $1.0717 from $1.0724.

ASX 200 expected to edge lower​

The Australian share market looks set to edge lower this morning following a poor start to the week in Europe. According to the latest SPI futures, the ASX 200 is poised to open the day 13 points or 0.1% lower. Wall Street was closed for a public holiday but the CAC and the DAX both fell 0.2%.

Market Watch

NYSE Holiday

REST of WORLD trading

 

[bigdog]

Asian stocks sink before US Congress votes on deal to avoid debt default

Asian stock markets are lower ahead of a vote by Congress on a deal to avert a government debt default while China factory activity weakened. Shanghai, Tokyo, Hong Kong and Sydney retreated. Oil prices declined. Wall Street’s benchmark S&P 500 index edged up less than 0.1% as President Joe Biden...

apnews.com

Stock market today: Wall Street churns to a mixed finish​

By STAN CHOE

NEW YORK (AP) — Wall Street churned to a mixed finish Tuesday as a long list of worries looms, even if the most pressing crisis seems to be calming as Washington moves to avoid a default on its debt.

The S&P 500 edged up by 0.07, or less than 0.1%, to 4,205.52, hovering close to its highest level since August. The Dow Jones Industrial Average slipped 50.56 points, or 0.2%, to 33,042.78. The Nasdaq composite, meanwhile, led the market with a 0.3% gain as excitement keeps building about artificial intelligence. It rose 41.74 to 13,017.43.

Tuesday marked the U.S. stock market’s first trading since President Joe Biden and House Speaker Kevin McCarthy struck a deal to allow the U.S. government to borrow more money, which would let it avoid a default on its debt. They now must convince Congress to approve it before the U.S. government runs out of cash to pay its bills, which could happen as soon as Monday.

Some on Capitol Hill are unhappy about the deal’s details, and Biden and McCarthy are both working to gather votes. The wide expectation on Wall Street has been for Washington to reach a deal in the 11th hour because failure would likely mean tremendous pain for the economy and financial markets.

Even if there is no default, though, all the partisan brinkmanship could erode more faith and trust in the U.S. government. That could trigger another downgrade to its credit rating, following Standard & Poor’s rating cut in 2011.

Beyond the drama around the nation’s debt limit, financial markets have been battling a long list of concerns. The economy is slowing, inflation is still high and interest rates may be heading even higher, which would further tighten the reins on the economy and financial markets.

The worries are also global, with China’s economic recovery weaker than expected following its relaxation of anti-COVID restrictions.

U.S. stocks have rallied despite such worries recently after companies reported drops in profit for the start of the year that weren’t as bad as feared. And at the center of it has been Wall Street’s growing frenzy over AI.

Nvidia, whose chips are helping to power the tech world’s newest rush, rose another 3% after already more than doubling so far this year. Last week, it gave a monster forecast for upcoming revenue as it described customers of all kinds racing to apply AI to their businesses.

Nvidia’s surge has its total value nearing $1 trillion, a threshold passed by only the biggest stocks, including Apple. The huge gains are raising worries about another possible bubble sweeping the stock market. But evangelists say AI is the next big revolution to reshape the global economy.

Also helping to prop up Wall Street in recent weeks have been reports showing a resilient job market and other signals that the slowing economy may avoid a recession.

“I’m sure there’s going to be a lot of money to be made in AI for a select group of companies, but that’s not enough to lift the entire economy out of a potential recession here,” said Rich Weiss, senior vice president at American Century Investments

He acknowledged the job market has remained much better than he expected under the weight of higher interest rates, but he points to weakness in the housing market, manufacturing, corporate profits and other areas that often fall before the labor market ahead of a recession.

“The job market will follow the others, not the other way around,” Weiss said.

He also highlighted how concentrated the stock market’s gains have been this year among a handful of companies, many benefiting from AI. The majority of stocks in the S&P 500 are down for the year so far, partially on worries about the economy.

A report Tuesday morning showed that confidence among consumers is falling and remains well below where it was before the pandemic, though it remains stronger than economists expected. That’s key because continued spending by households has been one of the main pillars forcing investors to push out their predictions for an upcoming recession by another three to six months.

On the losing end of Wall Street were companies in the energy industry. Exxon Mobil fell 0.9%, as the price of crude oil fell even more steeply amid worries about demand for fuel.

In the bond market, Treasury yields eased as fears about a possible default diminished.

The yield on the 10-year Treasury fell to 3.69% from 3.81% late Friday. It helps set rates for mortgages and other loans.

The yield on the two-year Treasury fell to 4.46% from 4.57%. It more closely tracks expectations for what the Federal Reserve will do.

Traders are largely bracing for another hike in short-term interest rates from the Fed at its next meeting in two weeks, but the hope is that may be the final one after more than a year of rapid increases.

Higher interest rates help to slow inflation, but they do that by dragging on the entire economy, raising the risk of a recession and hurting prices for investments.

In markets abroad, European stocks were lower while indexes were mostly higher in Asia.

ASX 200 expected to fall​

The Australian share market looks set to fall again on Wednesday following a mixed night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day down 34 points or 0.5% to 718734 points this morning.

Wall Street churned to a mixed finish Tuesday as a long list of worries looms, even if the most pressing crisis seems to be calming as Washington moves to avoid a default on its debt.

The S&P 500 edged up by 0.07, or less than 0.1%, to 4,205.52, hovering close to its highest level since August. The Dow Jones Industrial Average slipped 50.56 points, or 0.2%, to 33,042.78. The Nasdaq composite, meanwhile, led the market with a 0.3% gain as excitement keeps building about artificial intelligence. It rose 41.74 to 13,017.43.


Market Watch

 

[bigdog]

Stock market today: Asian shares mostly rise after House approves debt ceiling deal

Asian benchmarks are trading mostly higher after the United States House approved a debt ceiling and budget cuts package, avoiding a default crisis. Benchmarks rose in morning trading in Tokyo, Sydney, Hong Kong and Shanghai. Shares fell in Seoul. Regional investors are focused on worries about...

apnews.com

Stock market today: Wall Street slips as stocks slump worldwide​

By STAN CHOE

Wall Street slipped as stocks slumped worldwide Wednesday on worries about the strength of the global economy and inflation.

The S&P 500 fell 25.69, or 0.6%, to 4,179.83. The Dow Jones Industrial Average dropped 134.51, or 0.4%, to 32,908.27, and the Nasdaq composite lost 82.14, or 0.6%, to 12,935.29.

Stock markets in Asia fell even more following discouraging data on manufacturing from China. The world’s second-largest economy has not been rebounding as strongly as many investors had hoped. That raises worries when economies around the world are contending with still-high inflation and much higher interest rates than a year earlier.

Wall Street has been able to weather such concerns pretty well recently, largely because of gains for a handful of tech companies and others getting swept up in the buzz around AI. The S&P 500 managed to close out May with a modest gain.

But some of the air seeped out of those big winners on Wednesday. Nvidia, whose chips are helping to power the surge into AI, dropped 5.7% for its first fall since it gave a monster forecast last week for upcoming sales.

Worries are also rising for the larger U.S. economy, which has slowed under the weight of much higher interest rates. The Federal Reserve has raised rates at a furious pace since early last year in hopes of getting inflation under control. But high rates work by hurting the economy and hitting prices for investments.

“We see this as a race for weakness between inflation and economic activity,” said Tony Roth, chief investment officer at Wilmington Trust.

Either inflation needs to break lower to return to the Fed’s target, which would allow it to go easier on interest rates, or the economy will fall into recession. Roth said both the economy and inflation have remained strong for longer than he expected: “It’s a very slow race to the bottom.”

A report released Wednesday morning bolstered expectations for the Federal Reserve to hike rates at least one more time. It showed employers advertised more job openings than expected, the latest signal of a job market that’s remained remarkably resilient.

While that’s good news for workers and for the economy, it also gives the Fed more leeway to keep rates high. A strong job market could keep upward pressure on workers’ wages, which Wall Street fears could keep inflation high.

“The increase in job openings is the worst news the Fed could have because that just puts more pressure on wages,” Roth said

But stocks pared their losses in the afternoon after a Fed official hinted the central bank may hold rates steady at its next meeting in two weeks.

“Indeed, skipping a rate hike at a coming meeting would allow the Committee to see more data before making decisions about the extent of additional policy firming,” Fed Gov. Philip Jefferson said in a speech. But he said the Fed could still raise rates again at a later meeting.

Other, smaller portions of the economy have shown much more pain in the face of higher rates. A report on Wednesday morning suggested manufacturing in the Chicago region is contracting by much more than economists feared.

The U.S. banking system has also come under pressure. The Fed-driven surge in rates means customers are pulling their deposits in hopes of making more in interest at money-market funds. Higher rates have also knocked down the values for bonds and other investments banks made when rates were low.

Bubbling behind all these worries is a still simmering drama in Washington about a potential default on the U.S. government’s debt.

President Joe Biden and House Speaker Kevin McCarthy are trying to wrangle enough votes to pass a deal to allow the U.S. government to borrow more money. Without it, the U.S. government could run out of cash to pay its bills as soon as Monday.

On Wall Street, Advance Auto Parts plunged 35 after it reported much weaker profit for the latest quarter than analysts expected. The retailer also said it expects pressures to continue through 2023, and it cut its full-year financial forecast and reduced its dividend.

Hewlett Packard Enterprise tumbled 7.1% after it reported weaker revenue for the latest quarter than expected.

Ford Motor fell 4.7% after CEO Jim Farley told the Bernstein Decisions Conference that electric cars will cost more to make than gas-powered vehicles until at least 2030.

In stock markets abroad, indexes tumbled 1.9% in Hong Kong, 1.5% in France and 1.5% in Germany.

In the bond market, the yield on the 10-year Treasury fell to 3.62% from 3.70% late Tuesday. It helps set rates for mortgages and other important loans that influence the housing and other markets.

The two-year yield, which moves more on expectations for Fed action, fell to 4.39% from 4.46%.

ASX 200 expected to fall again​

The Australian share market is expected to have a subdued session on Thursday after a poor night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 13 points or 0.16% lower this morning.

Wall Street slipped as stocks slumped worldwide Wednesday on worries about the strength of the global economy and inflation.

The S&P 500 fell 25.69, or 0.6%, to 4,179.83. The Dow Jones Industrial Average dropped 134.51, or 0.4%, to 32,908.27, and the Nasdaq composite lost 82.14, or 0.6%, to 12,935.29.

Market Place

A BIG ALL RED YESTERDAY BELOW

 

[bigdog]

Stock market today: Asia follows Wall St up on hopes Fed will ease off rate hikes

Asian stock markets are following Wall Street higher ahead of an update on the U.S. jobs market. This comes after Federal Reserve officials reignited hopes they might skip another interest rate hike this month. Shanghai, Tokyo, Hong Kong and Seoul advanced Friday. Oil prices strengthened. Wall...

apnews.com

Stock market today: Wall Street rises with hopes for pause to rate hikes​

By STAN CHOE

Wall Street rose Thursday with hopes that the Federal Reserve may soon take it easier on its hikes to interest rates.

The S&P 500 rallied 1% after a suite of reports painted a picture of a split U.S. economy. The job market remains solid, but manufacturing is weakening and retailers are seeing shoppers under pressure. Altogether, investors saw the data pushing the Fed toward not hiking rates at its meeting in two weeks, which would be the first time that’s happened in more than a year.

The Nasdaq composite led the market with a 1.3% jump. It’s full of technology companies and other high-growth stocks that tend to benefit most from lower rates. The Dow Jones Industrial Average gained 153 points, or 0.5%.

One positive for the market came late Wednesday when the House of Representatives approved a deal to prevent a possibly catastrophic default on the U.S. government’s debt. But that was what Wall Street expected, and only a slip-up for the deal before it gets signed by President Joe Biden would likely cause big waves for stocks.

Investors are more concerned about whether the economy will fall into a recession before inflation recedes enough to convince the Federal Reserve to take it easier on interest rates.

Reports on Thursday gave a clouded view. One said that fewer workers applied for unemployment benefits last week than expected, while another suggested employers increased their payrolls last month by more than forecast.

That’s good news for workers and the overall economy, which has been slowing under the weight of much higher interest rates. But a strong job market could also keep pressure up on inflation, pushing the Fed to keep rates high.

On the flip side, manufacturing is continuing to get hit hard, in part by higher interest rates. A report from the Institute for Supply Management said manufacturing shrank for a seventh straight month in May. The contraction was worse than both the prior month and what economists expected.

Following the reports, traders were largely betting on the Fed to hold rates steady at its next meeting in two weeks. That’s something a Fed official a day earlier hinted may happen, though Fed Gov. Philip Jefferson also said that wouldn’t necessarily mean the end to hikes.

After that, traders are split on whether the Fed will follow up with another hike to rates at its next meeting in July. That’s key because high rates work to lower inflation by slowing the economy and hurting prices for stocks and other investments.

Tech and other high-growth stocks tend to get hit hardest by higher rates, and hopes for a pause to hikes had several Big Tech companies leading the way on Wall Street

Apple, Microsoft and Amazon all rose at least 1.3%. Their movements carry extra weight on the S&P 500 because they’re some of the most valuable on Wall Street.

A report on Friday could further sway the Fed and its chair, Jerome Powell. It’s the U.S. government’s comprehensive report on the job market.

For as much as Wall Street hopes the end to rate hikes is near, it may be getting ahead of itself, said JJ Kinahan, CEO of IG North America.

“The market’s been like a spoiled child,” he said. “Every six weeks, it stamps its feet and says, ‘Not this time!’ And every time, Powell says, ‘We’re going to continue to do this,’ and the market says, ‘I can’t believe they did this.’”

So far, the economy has held up despite a long list of worries because of a still-strong job market and resilient spending by consumers. But reports from several retailers suggested shoppers are feeling more pressure.

Dollar General dropped 19.5% after it reported weaker profit and revenue for the latest quarter than analysts expected. It said the economic environment has been more challenging than it expected, and it cut its financial forecasts for the full year. It tends to cater to lower income households.

Macy’s, which also owns Bloomingdale’s stores, rose 1.2% after reporting better-than-expected profit but weaker revenue than forecast. It also slashed expectations for the year and said shoppers began to pull back starting in March.

Some of the enthusiasm surrounding Wall Street’s recent frenzy around artificial intelligence also cooled.

C3.ai gave a forecast for revenue this upcoming fiscal year that failed to wow Wall Street like Nvidia’s did last week. C3.ai tumbled 13.2%, though it’s still up 210% so far this year. Nvidia rose 5.1%.

Also on the winning end was Hormel Foods, which rose 5.1% after reporting stronger profit for the latest quarter than expected. Its brands include Skippy, Spam and Applegate meats.

All told, the S&P 500 rose 41.19 points to 4,221.02. The Dow gained 153.30 to 33,061.57, and the Nasdaq jumped 165.70 to 13,100.98

In the bond market, the yield on the 10-year Treasury fell to 3.59% from 3.65% late Wednesday. It helps set rates for mortgages and other loans that influence the economy’s strength.

The two-year Treasury yield, which moves more on expectations for the Fed, fell to 4.32% from 4.40%.

ASX 200 expected to race higher​

The Australian share market looks set to end the week in a positive fashion following a solid night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 47 points or 0.65% higher this morning.

Wall Street rose Thursday with hopes that the Federal Reserve may soon take it easier on its hikes to interest rates.

The S&P 500 rallied 1% after a suite of reports painted a picture of a split U.S. economy.

The Nasdaq composite led the market with a 1.3% jump. It’s full of technology companies and other high-growth stocks that tend to benefit most from lower rates. The Dow Jones Industrial Average gained 153 points, or 0.5%

All told, the S&P 500 rose 41.19 points to 4,221.02. The Dow gained 153.30 to 33,061.57, and the Nasdaq jumped 165.70 to 13,100.9

Market Watch