4:10pm: Wall Street pares back on Monday although energy stocks outperform
After a three-day winning streak, stocks ran out of breath on Monday as investors had their eyes firmly on developments in Washington.
Lawmakers are expected to vote this week on legislation to fund the government beyond the end of the fiscal year on Thursday in a bid to prevent a government shutdown, and there are ongoing debates around a bipartisan $1 trillion infrastructure deal and $3.5 trillion budget reconciliation package.
The S&P 500 fell 0.28% to give back some gains after the blue-chip index posted a three-day winning streak at the end of last week, finishing the day at 4,443 points. The Nasdaq lagged with a drop of 0.52% to close at 14,970 points, while the Dow added about 0.21% as energy shares outperforming during Monday's session, powering the index to close at 34,869 points.
12:05pm: Energy prices benefit Dow, weigh on NASDAQ
A surging Brent Crude price which rallied to a three-year high as it approaches $80 a barrel added tailwinds to the Dow Jones Industrial Average Monday. The DJIA climbed 131 points (0.38%) by the lunch hour to hold at 34,934.
The positive price action in the energy sector didn’t translate to gains in the S&P 500 which shed 13 points to sit at 4,441 over the noon hour.
The tech weighted NASDAQ was also on the decline dropping 110 points after the morning bell to hold at 14,937, as investors looked away from the tech space towards industries that will benefit from infrastructure funding and the recovery.
This was further bolstered by the durable goods report which highlighted an uptick in new orders and a reduction in shipment bottlenecks.
Prices for Brent Crude and West Texas Intermediate are anticipated to continue to trend higher as demand increases globally putting pressure on OPEC to ramp up production.
“Supply constraints appear to be coming at the wrong time, with demand gradually picking up steam,” Joshua Mahony, Senior Market Analyst at IG wrote in a midday note. “The restart of transatlantic flights does highlight how we are likely to continue seeing demand for different types of crude products rise as the economic recovery gathers steam.”
Mahony also noted: “With the House of Representatives due to vote on Biden’s proposed infrastructure bill this Thursday, there is still plenty of grounds for further economic activity despite concerns over monetary tightening.
10.56am : Proactive North America headlines:
TNR Gold Corp (TSX-V:TNR, FRA:TNW, OTC:TRRXF) says Mariana lithium project in Argentina advancing towards construction
Pacific Empire Minerals inks deal to sell its Stars copper project stake in British Columbia
AIM ImmunoTech files provisional patent for Ampligen as a potential early-onset intranasal therapy
CleanSpark transitions all of its bitcoin mining power to Foundry USA Pool
Endexx and DJ Khaled bringing BLESSWELL line of CBD products to unique grooming event in Chicago
Talon Metals secures 51% ownership of Tamarack Nickel project in Minnesota six months ahead of schedule
Empower Clinics and SoLVBL Solutions pen deal for data security program
Co-Diagnostics (NASDAQ:CODX) to introduce its upcoming at-home and point-of-care PCR device at the 2021 AACC Annual Scientific Meeting & Clinical Lab Expo
Gevo awarded US patent to convert ethanol and bio-based alcohols into drop-in diesel and jet fuel products
Aurania Resources intersects “significant” silver-zinc mineralization at its Lost Cities-Cutucu project in Ecuador
Klondike Gold says drilling in Yukon has extended Lone Star Zone mineralization 250 metres east
New Oroperu Resources receives surface land rights on the Tres Cruces property in Peru ahead of First Light Capital merger
PowerTap completes engineering design of Gen3 hydrogen dispensing unit; starts to prepare for manufacturing a prototype
MedX Health and partner to run pilot program for its DermSecure Screening Platform in Italy
LeanLife Health (CSE:LLP) announces appointment of Anis Barakat as its chief executive officer, replacing Stan Lis
Fobi AI (TSX-V:FOBI, OTCQB:FOBIF) inks US$3.2M deal to acquire online coupon platform Qples
GoviEx releases positive results from a drill campaign at its Mutanga project in Zambia
BetterLife Pharma applies for patent protection for new 2-bromo-LSD compositions, including TD-0148A
PyroGenesis Canada says new US patent issued for plasma torch system; new CFO appointed
Trust Stamp (OTCQX:IDAID, EURONEXT:AIID) wins $3.9M contract from the US Department of Homeland Security
Else Nutrition develops wide range of Canada-compliant products which are set to launch in the first quarter of 2022
9.45am: Wall Street mixed at open
US shares opened Monday mixed but the Dow Jones rises as bond yields head north and the August reading for durable goods came in well above economists' expectations.
The Dow Jones Industrial Average added over 122 at 34,920, while the S&P 500 dropped 15 points at 4,440.
The tech laden Nasdaq dropped over 154 at 14,893 as the Likes of Nike and Apple dropped.
In the US, the 10-year Treasury yield increased, briefly to more than 1.5% on Monday - the highest level since June this year and up from 1.30% at the end of August.
In August orders for durable goods rose 1.8%, boosted by a rebound in the civilian aircraft, while business investment also rose, according to official data. Economists has expected a 0.6% increase.
6.50am: US stocks seen higher
US blue-chips looked set for gains at the start of a new week as oil prices hit their highest levels in nearly three years and as fears about Chinese property giant Evergrande Group's debt problems waned.
Futures for the blue-chip Dow Jones Industrial Average were up 0.3%, while those for the broader S&P 500 index added 0.1%, although Nasdaq-100 futures fell 0.2%.
Chris Beauchamp, chief market analyst at IG, a global leader in online trading commented: "China worries seem to have evaporated, or at least have dimmed in importance, and with the US once again talking about an infrastructure bill we seem to have a welcome return to some of the old themes that proved so fruitful for equity markets in the first half of the year."
"US futures point towards a better start to the week too, as the clouds that dogged markets last week disappear to be replaced by a new wave of optimism," he added.
Stocks were volatile last week as Evergrande’s debt problems weighed on markets, but Federal Reserve chairman Jerome Powell helped boost confidence when he said the US economy has recovered sufficiently for the central bank to potentially announce the start of bond-purchase tapering at its next meeting.
Investors will eye data on US durable goods orders for August, due at 8.30am ET on Monday, with economists expecting an increase, as business investment and consumer spending strengthens.
Oil prices advanced as supply constraints around the world continued to have an impact and the rally in natural gas prices also continued, with Brent crude hitting its highest level since October 2018.
Meanwhile, Bitcoin rose, recovering some ground lost after a steep decline prompted by the Chinese government outlawing cryptocurrency transactions.
Among equities, special-purpose acquisition company (SPAC) Gores Guggenheim surged after The Wall Street Journal reported that it was nearing a $21 billion deal to merge with Swedish electric-vehicle maker Polestar.