4:14pm: PacWest shares fall again
The Dow closed Friday down 9 points at 33,301, the Nasdaq Composite slid 44 points, 0.4%, to 12,285 and the S&P 500 declined 7 points, 0.2%, to 4,124. The small-cap Russell 2000 index lost 7 points, 0.4%, to 1,737.
The Dow and S&P closed lower for the second week in a row, even as the benchmarks recovered from their midday lows.
Investors digested softer-than-expected data on prices with both CPI and PPI numbers for April, positive news that was counterbalanced by more regional banking uncertainty. PacWest shares fell another 3% Friday after plunging about 20% Thursday.
12.05pm: Stocks struggle for direction at week’s end
US stocks were lower in noon trading as concerns continued to swirl around the health of regional banks.
At midday, the Dow lost 35 points to 33,275, while the S&P 500 eased 8 points at 4,123 and the tech-heavy Nasdaq slipped 44 points to 12,285.
“None of the sectors are making convincing moves in either direction, reflecting a general lack of conviction in the market,” Calamos Investments senior vice president Joe Cusick said.
Notable movers included shares of First Solar Inc, which shone more than 25% after the solar technology company announced the acquisition of Evolar AB, a developer of thin film used in solar panels, for up to $80 million.
9:35am: Debt ceiling talks delayed
US stocks moved modestly higher at the open on Friday as debt ceiling talks between congressional leaders were rescheduled for next week.
“The market seems rather perky despite a key meeting between congressional leaders to continue negotiations being pushed to next week,” commented FOREX.com market analyst Fionna Cincotta.
“Expectations are still that the two sides will reach an agreement before the early June X-date, but time is ticking.”
She added that trading this week had been choppy and lacking any firm direction.
“Investors have had plenty to weigh up this week, with headline inflation unexpectedly cooling, jobless claims rising to its highest level in 1.5 years and no progress on an agreement to lift the US debt ceiling,” Cincotta said.
“On a more positive note, tech stocks have held up better than their peers on optimism that the Fed will pause rate hikes at the June meeting and on news from Alphabet-owned Google that it will bring AI features to its signature search product. Alphabet, which is heavily weighed within the S&P 500 has rallied over 10% so far this week.”
Shortly after the opening bell in New York, the S&P 500 had added 12 points or 0.3% at 4,142 points, the Nasdaq was up 32 points or 0.3% at 12,360 points, while the Dow Jones had gained 60 points or 0.2% at 33,370 points.
7:55am: More data to digest
US stocks are expected to open higher on Friday, enjoying a lift from the softer-than-expected data on prices with both CPI and PPI numbers for April helping strengthen expectations that the US rate hiking cycle will come to a halt.
Futures for the Dow Jones Industrial Average rose 0.4% in pre-market trading, while those for the broader S&P 500 index lost 0.4% and contracts for the Nasdaq-100 were up 0.2%.
The Dow closed Thursday down 221 points, 0.7%, at 33,310, while the Nasdaq Composite added 22 points, 0.2% to 12,329 and the S&P 500 declined 7 points, 0.2%, to 4,131. The small-cap Russell 2000 index dropped 17 points, 1%, to 1,742.
"Ahead of the weekend, traders will be looking to the University of Michigan consumer sentiment and inflation expectations readings as the final key data of the week," said James Harte, market analyst at TickMill Group.
He noted that soft CPI and PPI data have dented rate hike expectations for June, adding that tech sector equities have firmed.
"The Nasdaq has broken out to fresh highs this week amidst a downturn in US rate expectations. If today's data comes in weaker than expected also, this narrative will likely be reinforced which will see tech stocks pushing higher in the near term."
Elsewhere, concerns about the US debt ceiling continue to rumble on with no solution at hand so far, even though a last-minute reprieve is expected.
Contact the author at jon.hopkins@proactiveinvestors.com