US stocks were mixed Monday morning after posting consecutive weekly losses for the first time since late September.
The S&P 500 (^GSPC) fell 0.1%, while the Dow Jones Industrial Average (^DJI) turned positive shortly after the open, rising 100 points, or 0.3%. The tech-heavy Nasdaq Composite (^IXIC) fell 0.5%. Last week, the S&P 500 lost 2.1%, the Dow 1.7% and the Nasdaq 2.7%.
Elsewhere in the market, US Treasury yields rose while the US Dollar Index fell. Oil rose with West Texas Intermediate (WTI) crude futures up nearly 2% to trade above $75 a barrel.
Tesla (TSLA) stock price rose in early trading after Chief Executive Officer Elon Musk released a Twitter poll asking if he should step down as head of the recently acquired social media platform.
Last week, Tesla stock plunged 16% — the worst week since the COVID pandemic began in March 2020 — over concerns about Musk’s management of Twitter and the sale of Tesla stock.
Monday’s moves follow a defeat last week after Federal Reserve officials hiked its federal funds rate by half a percentage point. Chairman Jerome Powell also stressed that the hike would continue into the new year and that policies would remain restrictive for as long as needed to contain still-high inflation – albeit with economic fallout.
“Reducing inflation is likely to require a sustained period of below-trend growth and some softening of labor market conditions,” Powell said during a speech on Wednesday. “The historical record strongly warns against premature policy easing. We stay the course until the job is done.”
The US Federal Reserve’s message of continued tightening monetary policy has dampened hopes of a Santa Claus rally – a steady rise in the stock market taking place around the year-end holiday. With the second consecutive weekly decline on Friday, the S&P 500 is down nearly 6% month-to-date.
The story goes on
“It was a double whammy – it was about the Fed and then some weaker economic data – and that created the image of a Fed that was ruthless about inflation and perhaps careless about the economy and didn’t realize exactly how much of an impact and how much damage is being done by what it has already done,” Kristina Hooper, Invesco’s chief global market strategist, told Yahoo Finance Live. “The general concern is that we are headed for a recession based on what the Fed has already done and beyond that the Fed is poised to do more.”
Traders work on the trading floor of the New York Stock Exchange (NYSE) in New York City, U.S., December 14, 2022. REUTERS/Andrew Kelly
Before markets close for a long Christmas weekend, investors can look forward to a hectic economic and earnings lineup that could provide further clues to the direction of Fed policy in the new year.
This week’s economic calendar will bring investors the latest Personal Consumption Expenses Index – or PCE – which is the Fed’s preferred measure of inflation, as well as another reading of GDP, a set of housing data and the Conference Board’s Consumer Confidence.
Earnings from Nike (NKE), General Mills (GIS), FedEx (FDX), Micron Technology (MU) and Carnival Cruises (CCL) are also highlights this week.
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Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
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