4:08pm: Dow drops more than 200 points
The Dow closed the final session of May down 221 points, 0.7%, at 32,992, the Nasdaq declined 50 points, 0.4%, to 12,081, while the S&P 500 slid 26 points, 0.6%, to 4,132.
“The market is digesting the sharp rally late last week and trying to figure out its footing,” Peter Boockvar, chief investment officer of Bleakley Advisory Group, said, as reported by CNBC. “We’re still far from being out of the woods here in terms of the major overhangs, being inflation, monetary tightening and rising rates.”
Amazon.com Inc (NASDAQ:AMZN) was among the leaders, as its share price gained more than 4% to hit $2,404.19.
12:05pm: Wall Street mixed at midday
US stocks were mixed at noon following last week’s rally amid ongoing inflation concerns.
At midday, the Dow had slipped 26 points at 33,187 points.
The S&P 500 and the Nasdaq however, had both inched into positive territory, at 4,158 points and 12,174 points respectively.
CMC Markets UK chief market analyst Michael Hewson noted that if US markets had been open yesterday, they probably would have finished higher.
“However, Fed Governor Christopher Waller’s comments about rate rises, along with higher-than-expected inflation readings in Europe has seen markets in the US open lower today, as US yields push higher,” he said.
In terms of major movers, AMC Entertainment Holdings (NYSE:AMC) Inc was up about 5% at noon after Top Gun: Maverick reported a highly successful opening weekend, with Hewson noting that receipts for the film came in well above expectations.
10.48am: Proactive North America headlines:
Bloom Health Partners logs profitable fiscal 2Q with $11.1M in revenue
Great Atlantic Resources reports assays from maiden drill program at Otter Brook gold showing at Golden Promise project
LithiumBank Resources offers update its flagship Boardwalk lithium brine project in Alberta
PlantX Life says it continues to excel as resources for the plant-based community; adds 10,000 new products to its US e-commerce platform
Golden Shield Resources (CSE:GSRI) reports high-grade gold intercepts from latest round of drilling at Mazoa Hill prospect
Perk Labs inks letter of intent to build custom branded app for SoyTalk Dessert
PyroGenesis completes production of additional titanium powder order for 3D Printing; readies move to higher output phase
Kontrol Technologies says to provide energy assessments and carbon reduction roadmap for Canadian university
Cordoba Minerals announces start of feasibility study for San Matias copper-gold-silver project, Colombia
Electra Battery Materials pledges to adopt comprehensive slate of ESG policies
Pathfinder Ventures (TSX-V:RV) posts 1Q revenue boost as occupied site nights at its RV resorts in British Columbia increase
Argentina Lithium kicks off exploration drilling at Rincon West project in Argentina
Renforth Resources extends polymetallic mineralization at Lalonde showing on its Surimeau property in Quebec
Great Panther Mining welcomes latest drill results from Urucum North underground project at Tucano mine
MamaMancini's posts record 4Q revenue following acquisition of two premier gourmet food manufacturers
Solstice Gold adds two projects to further expand lithium asset portfolio
FPX Nickel says new lab results solidify Baptiste project's potential as nickel industry's first carbon-neutral operation
Lavras Gold bolsters leadership team in Brazil with two key appointments
Real Luck Group reports cash and cash equivalents of C$12.5M in 1Q
Willow Biosciences expands its portfolio with a new partnered pharmaceutical project
Victory Resources says drilling at Smokey lithium project producing good results; stakes additional ground in Clayton Valley
Revive Therapeutics plans to advance its drug pipeline for inflammatory liver disorders amid growing cases of acute hepatitis in children
New Pacific Metals (TSX:NUAG, NYSE:NEWP) releases more results from Silver Sand drilling ahead of resource update
Benchmark Metals signs key strategic agreement with Tahltan Central Government to collaborate on advancing Lawyers gold-silver project to production
Guardforce AI (NASDAQ:GFAI) extends contract with Thailand's Government Savings Bank; contract worth approximately $19.5M over three years
MedX Health says its SIAscopy/DermSecure products show significant promise as it reports Q1 results
Nova Royalty posts royalty revenue of C$673,519 in first quarter of 2022
GlobalBlock Digital Asset Trading files delayed 2021 annual results, showing revenue of C$1.47M
Xigem Technologies (CSE:XIGM, OTCQB:XIGMF) says vendor of Cylix has breached key provisions of asset purchase agreement
HighGold (TSX-V:HIGH, OTCQX:HGGOF) Mining unveils plans for US$9M exploration program at Johnson Tract project, Alaska
AMPD Ventures says Departure Lounge subsidiary enters reseller agreement with cutting-edge motion capture platform firm
CULT Food Science says portfolio company unit committed to building the world’s largest bioreactor complex for cultivated meat
Star Royalties says 1Q revenue jumped 47% from year-ago period
Tribe Property Technologies announces record revenue for 1Q driven by organic growth and acquisitions
9:35am: Wall Street dips at the open
US stocks opened lower on Tuesday as oil prices spiked following the news that the European Union would be pursuing further sanctions against Russia involving a ban on crude oil and petroleum products.
Just after the open, the Dow had shed 366 points at 32,847 points.
The S&P 500 had dipped 32 points at 4,127 points and the Nasdaq 37 points at 12,094 points.
OANDA senior market analyst Craig Erlam noted that the price of a barrel of brent crude hit $120 off the back of the EU deal, as well as the continued reopening of Shanghai following its coronavirus lockdowns and better-than-expected Chinese manufacturing purchasing managers index (PMI) figures.
“The gradual phasing in of the (EU) deal along with the exemptions included prevented the price from rising much higher but ultimately it further tightens a market that's already undersupplied,” Erlam said.
"While the manufacturing and non-manufacturing PMIs were both still contractionary, they were also much better than expected and a significant improvement on April. The lifting of restrictions will see these improve further which will be another upside risk for oil prices."
6.30am: Inflation worries hold sway
US markets were expected to open lower on Tuesday, as trading resumes after Memorial Day, on inflation concerns following a spike in oil prices.
News that the EU will put sanctions on Russian oil, as that country’s invasion of Ukraine entered a fourth month, lifted oil prices and suggested that there will be no let-up in inflationary pressures.
Futures for the Dow Jones Industrial Average fell 0.6 % in pre-market trading, while those for the broader S&P 500 index also shed 0.6%, and contracts for the Nasdaq-100 lost 0.3%.
“Yesterday, European leaders finally announced their decision to partially ban the Russian oil. Supplies from sea will no longer be purchased, while the pipeline supplies will be abandoned gradually,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
“As such, Europe will reduce two-thirds of its oil imports from Russia, which will reportedly cost Russia around $10 billion in lost revenue. Of course, the news suggests that the inflation situation in Europe, and in the West, could get worse before it gets better," she added.
In energy markets on Tuesday, WTI crude oil futures rose 3.2% to $118.79 a barrel and Brent crude futures added 3.3% to $119.40.
“Even though we saw some easing in US inflation figures earlier this month, the relentless positive pressure on oil prices is very much worrying across the Atlantic as well,” Ozkardeskaya continued, noting that benchmark US crude oil prices are near the $120 a barrel level while Brent crude has reached higher levels.
Oil-led price pressures are one of the main factors contributing to higher levels of inflation across the globe and the latest oil price spike is a worrying development. Investors fear that higher interest rates at a time when inflation is elevated will threaten economic growth and hit corporate bottom lines.
“Even though oil advanced to levels that look interesting for selling a top, the positive pressure is too strong for betting on a downside correction in the short run. Shorting oil has become a risky bet, as following the European ban, there is a stronger case building for a further extension of the gains," Ozkardeskaya added.
She also noted that inflation data from Germany shows that price pressures are building, German inflation hit a record high of 8.7% in May, above the 8.1% penciled in by analysts.
Contact the author at jon.hopkins@proactiveinvestors.com