Stocks finished mixed Tuesday as investors continued to track risks tied to Israel's conflict with Iran while navigating a busy session for corporate earnings and comments from Fed Chair Jerome Powell.
The Dow Jones Industrial Average gained 63 points, or 0.17%, to 37,798.97, while the S&P 500 lost 10 points, or 0.21%, to 5,051.41 and the tech heavy Nasdaq dropped 19 points, or 0.12%, to 15,865.25.
Stocks were wobbled after Powell said that recent inflation data has shown very little progress in bringing price pressures back to the central bank's 2% target.
Jamie Cox, managing partner for Harris Financial Group, said “the Fed picked a bad time to have a communication problem on the path of rates this year.”
“The Fed has a free pass to sit on rates longer while the labor market remains strong, consumption is unaffected, and the typical consequences of hiking rates quickly aren’t apparent in the economy,” he said. “Markets need to focus on the fact that rates are sufficiently restrictive, instead of how many cuts are in the pipeline.”
Updated at 1:43 PM EDT
No progress yet
Federal Reserve Chairman Jerome Powell said Tuesday that recent inflation data has shown very little progress in bringing price pressures back to the central bank's 2% target, adding it's taking "longer than expected" to gain confidence in terms of executing rate cuts.
The recent data have clearly not given us greater confidence, and instead indicate that it's likely to take longer than expected to achieve that confidence," Powell told an economic event in Washington.
Benchmark 2-year note yields hit 5% for the first time since late October in the wake of Powell's comments, while 10-year notes rose to 4.680%, the highest since early November.
Stocks were lower, as well, with the S&P 500 last marked 2 points lower on the session and the Dow paring its daily advance to around 143 points.
* POWELL: 12-MONTH CORE #PCE ESTIMATED TO BE LITTLE CHANGED AT 2.8%
— Carl Quintanilla (@carlquintanilla) April 16, 2024
@JohnSpall247 #FOMC 🇺🇸 pic.twitter.com/m5Ki6vzBgm
Updated at 1:12 PM EDT
Trumped
Trump Media & Technology shares extended their recent slump, falling another 14% in afternoon trading to change hands at $22.91 each, a move that still leaves the stock up 32% for the year but down 71% from its last March peak.
That level, which valued the assets of Truth Social, the social media network founded by former President Donald Trump at around $9 billion, was last pegged at around $3.14 billion. The group had $4 million in sales last year
BREAKING: $DJT stock
— Tristan Snell (@TristanSnell) April 16, 2024
Price keeps collapsing, now under $25 and still falling.
Stock was at $66.22 only 3 weeks ago.
This appears to be the “dump” part of the pump-and-dump cycle.
Makes sense for a company that LOST over $58 million last year.
Updated at 10:41 AM EDT
Tesla tumble
Tesla shares fell below the $500 billion threshold, in terms of market value, for the first time in nearly a year Tuesday as analysts count the cost of the group's largest-ever layoffs amid a global slump in EV demand.
Tesla shares were marked 3.75% lower at $155.44 each in early trading, extending their 2024 decline to around 37% and pegging their market value at $486 billion.
Related: Analysts weigh in on 'far-reaching' Tesla layoffs as stock extends slump
Updated at 9:48 AM EDT
Mixed open
Stocks are giving back some of their earlier pre-market gains, with the S&P 500 down 14 points, or 0.28%, and the Nasdaq off 53 points, or 0.33%, in the opening minutes of trading. A big move higher for UnitedHealth has the Dow up 65 points, or 0.17%.
Benchmark 10-year note yields were back on the rise, as well, and last pegged at 4.68%, with 2-year notes rising to 4.974% in early trading.
S&P 500 Opening Bell Heatmap (April 16, 2024)$SPY +0.09% 🟩$QQQ -0.03% 🟥$DJI +0.57% 🟩$IWM -0.82% 🟥 pic.twitter.com/UilumwvwiD
— Wall St Engine (@wallstengine) April 16, 2024
Updated at 8:34 AM EDT
Safe as houses?
Housing starts tumbled last month, the Commerce Department reported Tuesday, with the headline figure falling 14.7% from last year to an annualized rate of 1.321 million units. Permits for new construction were lower as well, falling 4.3% from February to 1.458 million.
Housing starts crashed -14.7% MoM to 1.32 mil in Mar, the lowest since Aug 2023.
— MTS Insights (@MTSInsights) April 16, 2024
Permits issued also fell on the month, down -4.3% MoM, as higher interest rates weigh on real estate activity.#housing (Census Bureau) https://t.co/hkV0UJADuQ pic.twitter.com/q3f37qgHcD
Updated at 8:05 AM EDT
Holding the line
UnitedHealth shares powered higher in early Tuesday trading after the health insurance giant held to its full-year profit forecasts despite a% big hit tied to a February cyber attack and the ongoing surge in post-Covid medical costs.
UnitedHealth shares were marked 7.5% higher in pre-market trading to indicate an opening bell price of $479.06 each.
Related: UnitedHealth shares surge on Q1 earnings update, cyberattack costs
Check back for updates throughout the trading day
Stocks closed firmly lower last night, with the S&P 500 falling 1.2% to pull the broadest benchmark of U.S. blue-chip shares below its 50-day moving average, a key Wall Street performance metric typically suggests further pressures over the coming weeks.
Israel's vow to retaliate for Iran's weekend missile strike, which Tehran said was tied to Israel's involvement in an attack on an embassy compound in Syria, has gripped global markets and powered a big move into safe-haven assets such as gold, the dollar and U.S. Treasury bonds.
The U.S. dollar index in fact was last marked 0.06% higher on the session and closing in on a five-month high at 106.261, with gains also propelled by yesterday's stronger-than-expected reading for March retail sales.
Related: Retail sales surge as spending boosts GDP bets and tests Fed rate cut timing
Prime Minister Benjamin Netanyahu has held two formal cabinet meetings over the past 48 hours to discuss Israel's response, but no official word has emerged as to when and how the reply is expected to come.
On Wall Street, focus will likely remain fixed on safe-haven-asset flows and risk appetite, with gold prices holding at $2,370.45 after hitting a record $2,431.29 in late Friday dealing.
Benchmark 10-year Treasury note yields, meanwhile, were marked at 4.649%, while 2-year notes were pegged at 4.949% after briefly flirting with the 5% mark in midday Monday trading.
A host of blue-chip earnings were also released this morning as well, with first-quarter updates from UnitedHealth (UNH) , Bank of America (BAC) , Morgan Stanley (MS) and Johnson & Johnson (JNJ) .
Analysts forecast first-quarter earnings rising 2.7% from a year earlier to a share-weighted $447.3 billion, with second-quarter profits estimated to improve to $494.7 billion.
Related: Hot inflation report batters stocks; here's what happens next
The Commerce Department will also publish March housing-starts data at 8:30 a.m. U.S. Eastern Time, with economists looking for a modest decline in both new construction and building permits.
Heading into the start of the trading day, futures contracts tied to the S&P 500 suggest a 5-point opening bell gain, while those linked to the Dow Jones Industrial Average suggest a 190-point gain. The tech-focused Nasdaq, meanwhile, is priced for a 10-point advance.
More Wall Street Analysts:
- Analyst unveils new Nike price target ahead of big summer for sports
- Analysts weigh in on Google-parent Alphabet’s stock after cloud event
- Analysts revamp Disney stock price target after proxy fight
In other markets, global oil prices were back in the red, with Brent crude contracts for June delivery marked 39 cents lower at $89.72 per barrel. Investors focused on softer near-term-demand forecasts over the likely supply disruptions tied a broader regional Mideast conflict.
Overseas, last night's selloff on Wall Street rippled through markets in Europe and Asia, with the Stoxx 600 last marked 1.4% lower in early Frankfurt trading and Britain's FTSE 100 down 1.38%.
Japan's Nikkei 225 ended 1.94% lower as the yen slumped to a fresh 34-year low of 154.59 against the surging greenback. The regionwide MSCI ex-Japan benchmark fell 2.07% into the close of trading.
Related: Veteran fund manager picks favorite stocks for 2024
