4:08pm: Uncertainty abounds
The Dow closed Monday up 101 points, 0.3%, at 33,586, while the Nasdaq Composite slid 4 points to 12,084 and the S&P 500 added 4 points to 4,109. The small-cap Russell 2000 index jumped 18 points, 1%, to 1,773.
Two of the three benchmarks ended nearly exactly flat, as investors await CPI and PPI data later this week. The big question is how the Fed will respond to the new data.
“We’re seeing what we believe is the same investor narrative, which is uncertainty around the mixed economic data, which is driving uncertainty around Fed policy and a greater concern — particularly with Friday’s strong employment data — that the Fed may again move forward with another rate hike,” AXS Investments’ Greg Bassuk said.
“And I think investors have greater concerns about a potential U.S. recession, and the markets seem to be under greater pressure as the Fed decision looms.”
2:50pm: Block shares fall as KBW analysts downgrade stock
Shares of Square’s parent company Block fell 3.2% after analysts at KBW downgraded their rating on the stock from ‘Outperform’ to ‘Market Perform.’
The analysts awarded Block a price target of $75. The company's shares are currently trading at about $65.93.
“We think SQ's risk/reward profile has become less attractive as multiple risks are starting to add up,” the analysts said in a note to clients, as reported by Investing.com.
12:05pm: Friday’s March data showed continued jobs growth strength
US stocks were lower in noon trading after 236,000 new jobs were created in March, in line with expectations.
At midday, the Dow lost 32 points to 33,453, while the S&P 500 eased 23 points at 4,082 and the tech-heavy Nasdaq slipped 108 points to 11,980.
“We’re seeing what we believe is the same investor narrative, which is uncertainty around the mixed economic data, which is driving uncertainty around Fed policy and a greater concern — particularly with Friday’s strong employment data — that the Fed may again move forward with another rate hike,” AXS Investments’ Greg Bassuk said.
Notable movers included shares of Apple Inc (NASDAQ:AAPL), which slipped more than 2% after the consumer electronics giant revealed that its personal computer shipments dropped 40% in the first quarter.
11:00am: Micron up, Tupperware down
Micron Technology shares rallied as investors reacted to Samsung’s plan to cut memory production. Shares jumped more than 7% after South Korean tech giant’s announcement Friday that it would slow down memory production is seen as big win for other companies in the sector, including Micron.
On the flipside, Tupperware Brands shares fell nearly 40% in early trading after the maker of food storage products said it won’t have enough cash to fund its operations if it doesn’t secure more money, adding that it has hired financial advisers to help deal with its near-term challenges.
9:40am: Tech stocks tumble
US stocks moved lower at the open as investors returning after the long weekend weighed up Friday’s jobs report which showed the continued strength of the labor market.
Just after the market opened, the tech-heavy Nasdaq had shed 124 points or 1% at 11,962 points, the S&P 500 was down 31 points or 0.8% at 4,074 points, and the Dow Jones was down 130 points or 0.4% at 33,355 points.
In terms of major movers, Pioneer Natural Resources (NYSE:PXD) shares added 7.4% on reports of an Exxon Mobil takeover.
Tesla shares fell 4.6% after the electric vehicle maker slashed the prices of its US models again over the weekend, the fifth price cut since January.
8:45am: Apple loses biggest bite as global PC shipments tumble in 1Q
Apple's shares were down 1.3% in Monday pre-market trade after a new report on global PC shipments.
Apple took the biggest hit as pain in the personal computer (PC) market persisted in the first quarter of 2023 due to excess inventory and poor demand, according to a report from the International Data Corporation (IDC).
The IDC Worldwide Quarterly Personal Computing Device Tracker revealed that global shipments of personal computers (PCs) fell by 29% to 56.9 million in the three months to March 31, with Apple suffering a 40.5% decline. Dell Inc. (NASDAQ:DELL) (Dell Inc. (NASDAQ:DELL)) saw shipments fell 31%, while Lenovo and ASUS both saw declines of 30.3%.
6:30am: Final piece of the puzzle
Wall Street is likely to open mixed as investors ponder an employment report that was largely in line with expectations ahead of inflation data this week that is also likely to guide the Federal Reserve’s next move on interest rates.
Futures for the Dow Jones Industrial Average rose 0.1% in Monday pre-market trading while those for the broader S&P 500 index were steady and contracts for the Nasdaq-100 fell 0.1%.
The non-farm payrolls report for March showed the US added another 236,000 jobs in March against expectations of around 235,000 jobs to be added during the month. The unemployment rate declined to 3.5%, against expectations that it would hold at 3.6%. Average hourly earnings increased by 0.3%, pushing the 12-month increase to 4.2%, the lowest level since June 2021.
“The best case for the markets has been a small headline miss or gain as a massive surprise on either side could have really derailed everything for investors,” commented Naeem Aslam, chief investment officer at Zaye Capital Markets. “Market players are still in a process of digesting the news but so far it seems like that bad news is good news.”
Ahead of the release of the NPFs on the Good Friday holiday, the Dow closed Thursday up 3 points at 33,485, the Nasdaq Composite added 0.8% to 12,088 and the S&P 500 improved 0.4% to 4,105. The small-cap Russell 2000 index ticked up 1 point to 1,754.
The US NFP data was the final piece of the puzzle for traders and the focus will be on how the Federal Reserve reacts, Aslam noted.
“Market players have been very much pricing in that the Fed will slow down the roll on hiking the interest rate and now the moment of truth will come to the light if that is what they are going to do,” he added.
The Fed will also monitor inflation trends ahead of its next rate decision on May 3. The Consumer Price Index (CPI), out on Wednesday, is expected to show headline inflation rose 0.2% in March from February’s 0.4% month-over-month gain, and at an annual rate of 5.2% from 6% in February.