- Wall Street sticks in red
- Markets awaiting Wednesday's inflation data
- Small business optimism at lowest level since 2012
4:10pm: Caution ahead of key inflation report
US stocks closed on mixed footing following a relatively uneventful trading session on Tuesday.
The Dow Jones remained nearly unchanged, leveling off at 38,884 points, while the Nasdaq Composite rose by approximately 0.3% to reach 16,307 and the S&P 500 increased by over 0.1% at 5,210.
Investors are cautious as they await the release of the Consumer Price Index on Wednesday, anticipating insights into the trajectory of interest rates. With doubts emerging about the Federal Reserve's projected three rate cuts for the year due to ongoing US economic strength, attention is keenly focused on the CPI data for March, with signs of cooling inflation potentially prompting a policy shift in June.
The upcoming start of first-quarter earnings season further adds to anticipation, with major financial institutions like Citigroup, JPMorgan, and Wells Fargo set to report results later this week.
1.57pm: Markets remain lower into afternoon
The Dow Jones recouped some losses from Tuesday’s low but remained 130 points down at 38,762 come the afternoon.
Muted trading ahead of Wednesday’s inflation data had the Nasdaq down 15 points at 16,238 and the S&P 500 off 13 points at 5,188 in the meantime.
According to Scope Markets analyst Joshua Mahony, Tuesday was being viewed as the “calm before the storm” ahead of a likely volatile period later in the week on the back of the key macro data.
“The expectation of a rebound in US inflation does raise the likeliness of a risk-off move that could benefit the dollar but come to the detriment of equity markets,” he said.
“While markets now price the June monetary policy decision as a coin-toss for the Federal Reserve, the likely rise in US CPI should provide a reminder of [the] patient approach being taken by [chair] Jerome Powell & co.”
Among companies, Moderna Inc (NASDAQ:MRNA, ETR:0QF) remained the day’s top riser with gains of 4.8% following the release of positive cancer vaccine trial data earlier on.
Enphase Energy Inc (NASDAQ:ENPH, ETR:E0P) emerged as another big riser on gains of 4.7%, as the solar and battery technology company prepared to discuss first-quarter trading on a conference call later in the day.
Travelers Companies Inc (NYSE:TRV) led the Dow Jones’ fallers all the while after a share price target hike from JPMorgan analysts remained below the current trading value of US$223.82, which was down 2.9% for the day.
Boeing Co (NYSE:BA, ETR:BCO) and American Express Co also weighed the index down, while Paccar Inc and Royal Caribbean Cruises were falling elsewhere.
11.42am: Stocks slump into late morning
The Dow Jones had lost 221 points to sit at 38,671 come late morning, as investors appeared to turn attention to key inflation data due on Wednesday.
The Nasdaq and S&P 500 followed suit, losing 48 and 23 points respectively to sit at 16,205 and 5,179.
Markets had climbed early on, following a mixed but largely uneventful showing on Monday, with Wednesday afternoon’s inflation data and its ramifications for rate cut hopes later in the summer now seeping in.
Indeed, “risk-off sentiment dominated the agenda ahead of Wednesday's FOMC minutes and CPI print,” IG analyst Axel Rudolph explained.
That said, Moderna Inc (NASDAQ:MRNA, ETR:0QF) emerged among companies enjoying a strong day of trading, after the pharma giant unveiled positive cancer vaccine trial data earlier on.
Shares in the firm were up 7.4% at US$112.88 on the news that its mRNA-based vaccine developed with Merck's drug Keytruda had prompted a reduction or disappearances of tumours in 27.3% of patients during the early-stage studies.
Hinge owner Match Group rose 4.4% to US$35.53 in the meantime, on news multiple institutional investors had built stakes in the dating services firm over the fourth quarter.
NVIDIA Corp (NASDAQ:NVDA, ETR:NVD) sat among the day’s fallers though, down 3.6% on cautious comments from analysts arguing optimism had buoyed semiconductor stocks recently, while Royal Caribbean Cruises Ltd (NYSE:RCL) also faced a hefty 5.2% fall.
9.36am: Wall Street opens with marginal lift
US stocks have opened a tick higher as most continue calmly from Monday's muted session ahead of inflation data tomorrow.
The Dow Jones lifted 93 points to 38,986, while the S&P 500 rose 19 points to 5,221.
The Nasdaq ticked 66 points higher to 16,320.
Despite the lack of market movement, a few stocks have risen at the open.
Amercian Eagle Outfitters, the fashion retailer popped 5.5% after it was upgraded by JPMorgan from neutral to overweight.
Similarly, the mining group Freeport-McMoRan jumped close to 3% after receiving a broker upgrade to buy from Bank of America.
Goldman Sachs also dished out an upgrade. The US bank rerated beer maker Molson Coors to a buy, causing shares to jump a little over 1%.
8.30am: Wall Street holding steady as small business sentiment plunges
Wall Street is attempting to lift slightly at the open, with the US markets appearing to have started the week stuck in first gear ahead of inflation data tomorrow.
The Dow Jones is up around 78 points ahead of the open at 39,281.
Meanwhile, the S&P 500 is set to begin trading around 16 points higher at 5,267, with the Nasdaq positioned to open 74 points higher at 18,364.
It comes after data revealed optimism in the US's small business segment has slumped to its lowest level in 11 years due to weakened demand and inflationary concerns.
Sentiment fell for the seventh time in eight months by 0.9 points to 88.5, marking the lowest level since 2012, the National Federation of Independent Business revealed.
Bill Dunkelberg, the group’s chief economist, said: “Owners continue to manage numerous economic headwinds. Inflation has once again been reported as the top business problem on Main Street and the labor market has only eased slightly.”
7.31am: Stocks to open muted ahead of Wednesday's inflation reading
US stocks are expected to lift marginally higher on Tuesday as Wall Street appears to be on hold ahead of inflation data on Wednesday.
The Dow Jones is positioned to open around 16 points higher at 39,220, while the S&P 500 and Nasdaq are up 7 points and 38 points respectively.
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown that the muted trading from the market is the result of a " holding-pattern scenario ahead of tomorrow’s US inflation data".
She said: "With relatively limited corporate news to change the tide, investors are more concerned with macro events this week. Expectations for how much the Federal Reserve will cut rates this year have fallen to their lowest level since October, following unprecedented labour market figures last week.
"Interest rate-sensitive treasury yields have edged higher as a result, and the overall mood across US and European markets is very much a cautious wait-and-see approach today."