Apr 9 2024: The U.S. stock market experienced a slight uptick on Tuesday, supported by lower bond yields as investors awaited key inflation data and the start of the quarterly earnings season.
As of 09:35 ET (13:35 GMT), the Dow Jones Industrial Average increased by 90 points, or 0.2%, while the S&P 500 and NASDAQ Composite rose by 0.4% and 0.5%, respectively.
There’s a sense of apprehension on Wall Street, particularly following the strong nonfarm payrolls report on Friday, leading traders to reduce expectations of a June interest rate cut by the Federal Reserve.
Nevertheless, the decline in Treasury yields, following a four-month high on Monday for the 10-year rate, alleviated some of the market pressure.
Investors are eagerly awaiting the release of the consumer price index (CPI) inflation data for March, expected on Wednesday, which is anticipated to show a potential increase in inflation, remaining above the Fed’s 2% target.
Persistent inflation has been a key concern for the Fed regarding potential interest rate cuts. Several officials have cautioned that high inflation might postpone rate cuts this year.
Additionally, investors are looking forward to more insights from the Federal Reserve this week, including the minutes from the March meeting, also scheduled for Wednesday. Although the Fed initially projected a 75 basis point rate cut this year at the meeting, traders have tempered expectations, with a 54% chance now predicted for a 25 basis point cut in June, according to the CME Fedwatch tool.
The anticipation of first-quarter earnings reports has also kept the market on edge, particularly with major U.S. banks like JPMorgan Chase, Citigroup, and Wells Fargo scheduled to report earnings this week, along with Delta Air Lines and BlackRock.
Investors are eager to see if these companies can justify the significant increase in valuations witnessed over the past three months.
In other news, Lucid stock rose over 1% after reporting first-quarter deliveries above market expectations, aided by price cuts that boosted demand for its luxury electric sedans.
Taiwan Semiconductor Manufacturing stock also saw a 2.5% gain, remaining in focus after news of a $6.6 billion subsidy from the U.S. Commerce Department for an advanced semiconductor plant in Phoenix, Arizona, to produce the world’s most advanced 2 nanometer technology.
Oil prices saw a modest increase on Tuesday, recovering from losses in the previous session, as ceasefire talks in the Israel-Hamas conflict added uncertainty to the market.
As of 09:35 ET, U.S. crude futures traded flat at $86.43 a barrel, while the Brent contract climbed 0.2% to $90.52 per barrel.
Despite discussions in Cairo regarding a ceasefire between Israel and Hamas, a lasting agreement remains elusive, contributing to ongoing market volatility.
(Ambar Warrick contributed to this article.)
