U.S. stocks remained in a holding pattern on Tuesday as investors waited for a key inflation report that could shed light on the direction of interest rates.
Futures tied to the Dow Jones Industrial Average (^DJI), the S&P 500 (^GSPC) and the tech-heavy Nasdaq 100 (^NDX) all traded just above the flatline.
Stocks are ahead of Wednesday's consumer price index release, seen as a crucial point for a market that faces a slower next rise after a strong first quarter.
Given the continued strength of the U.S. economy, investors are increasingly less confident that the Federal Reserve will implement the three interest rate cuts forecast for this year. This has increased the focus on the March CPI numbers, with any sign that inflation is starting to cool again seen as an invitation for a policy change in June.
Meanwhile, fading hopes of rate cuts have helped push the 10-year Treasury yield (^TNX) near its five-month high – another potential headwind for stocks, with the 5% level seen as a key concern. The benchmark yield fell to about 4.4% on Tuesday.
At the same time, rising metal prices have raised fears of a knock-on effect on inflation. Copper (HG=F), a key industrial commodity, rose about 0.4% early Tuesday, adding to a 10% rise since the start of the year that has sparked talk of a new bull market. Gold (GC=F) climbed as much as 1.1% to $2,365.35 an ounce, continuing its rally and hitting another new record.
Another catalyst on the horizon is the start of first-quarter earnings season, which begins in earnest on Friday with results from companies like Citigroup (C), JPMorgan (JPM) and Wells Fargo (WFC).
live2 updates
- Tuesday, April 9, 2024, 5:08 a.m. CDT
Young people spend money sparingly, but not everywhere
Teens are curbing their spending, according to Piper Sandler's latest Taking Stock study released this morning.
The spring survey shows that teens' “self-reported” spending fell 6% year-over-year to $2,263 and has increased just 1% since the fall.
The biggest category winner is cosmetics.
Beauty spending reached its highest level since spring 2018, which is interesting given that Ulta (ULTA) CEO David Kimbell last week warned of an industry slowdown (its stock price was tanking). According to the survey, Elf Beauty (ELF) gained the largest market share compared to its competitors.
Young people are limiting their spending. (Piper Sandler)
Tuesday, April 9, 2024, 5:00 a.m. CDT
PC recovery continues
Keep an eye on stocks of PC makers Dell (DELL) and HP Inc. (HP) today.
PC industry firm Canalys said total shipments of desktops and notebooks rose 3.2% annually to 57.2 million units in the first quarter. The research institute says this is a sign that demand is increasing ahead of catalysts like the launch of AI PCs and the Windows 11 update later this year.
“Growth in the first quarter of 2024 bodes well for a strong PC market later in the year,” said Ishan Dutt, principal analyst at Canalys. “Sellers and the distribution channel have gone through some final phases of inventory corrections and macroeconomic conditions in certain markets continue to limit demand. But the strength of the refresh option, particularly on the part of companies, is gradually coming to the fore. The market will continue to grow stronger in the coming quarters as customers prioritize upgrades in preparation for a large-scale transition to Windows 11.”
PC recovery continues. (Canalys)
Comments are closed.