NASDAQ Dominates in an Otherwise Mixed Market Today

As trading kicked off this week, the market open was a mixed bag, reflecting all the noise from the overnight and futures scene. The tech-heavy NASDAQ stood out a bit more than the S&P 500. Treasury yields, particularly the 2-year one, saw a bit of a bump, going past the 4.0% mark. At the same time, WTI crude oil prices stayed above $70, holding steady even though they’re 11% off from the year’s top score.

Today’s Highlights And Headlines

On Monday, Wall Street experienced a slight uptick, amidst speculation on forthcoming reports expected to highlight the impact of economic deceleration on one of the main factors staving off recession: robust consumer spending in the U.S.

In a day of slight fluctuations, some of the more noticeable shifts were triggered by companies announcing acquisition deals. Among these, energy firm Oneok witnessed a 9.1% tumble after announcing its purchase of Magellan Midstream Partners, which conversely saw its shares leap by 13%. However, despite these movements, the wider market maintained a relatively calm demeanor, even as a variety of concerns persistently hovered over Wall Street.

The primary concern centers around the looming threat of a potential recession later this year, significantly due to elevated interest rates designed to curb inflation. Added to this, increasing worries about potential fractures in the U.S. banking system and the approaching possibility of a U.S. government default on its debt, potentially as early as June 1, have economists sounding the alarm. Such a scenario could have disastrous implications.

Yet, the U.S. economy has thus far been propped up by a resilient job market, enabling American households to maintain their spending habits in the face of these pressures. This “resilience” has served as a significant support system for the economy. In upcoming reports on Tuesday, the government is set to reveal the extent of growth in retail sales across the nation for the past month. On Wednesday evening, Joe Rokop, Managing Director of Commodities and Equities, will share how he has consistently grown his trading account from $10k to well over $400k in these uncertain market conditions. Click here to save your spot for this masterful presentation.

Fiscal Fireworks: Earnings Galore

Several major retailers will announce their individual profits for the first quarter of the year, with Home Depot reporting on Tuesday, followed by Target on Wednesday, and Walmart on Thursday.

These companies are among the last few yet to announce their Q1 results. Thus far, a majority of S&P 500 companies have exceeded expectations, albeit with a particularly low benchmark set for this period.

Despite this, S&P 500 companies are expected to report a decrease of 2.5% in earnings per share compared to the previous year. If accurate, this will mark the second consecutive quarter of declining profits, according to data from FactSet.

Economic Score: Debt Ceiling and Retail Sales

The economic score sheet revealed a political chess match around U.S. debt-ceiling negotiations, with President Biden expressing optimism about reaching an agreement. Concurrently, the market anticipates April’s retail sales data, providing valuable insights into the U.S. consumer’s health. Inflation and interest rates continue to play a background rhythm in the market symphony, with both having a profound influence on economic movements.

Market Close

The S&P 500 ascended by 12.20 points, equivalent to a 0.3% growth, closing at 4,136.28. This was yet another upward tick in a series of unremarkable, yet consistent advances made by the market in recent weeks. The Dow Jones Industrial Average followed suit with an increase of 47.98 points (or 0.1%), ending the day at 33,348.60, while the Nasdaq composite rose by 80.47 points, a 0.7% growth, concluding at 12,365.21.