Stock Market Today-04/19: Dow Rising on Fed Risks and Mixed Earnings
U.S. stock futures edged higher on Tuesday as the dollar extended its gains and Treasury bond yields hit multi-year highs as investors reacted to hawkish comments from an influential US president. Federal Reserve, a resurgence of fighting in eastern Ukraine and the start of a flurry of corporate earnings reports on Wall Street.
St. Louis Federal Reserve Chairman James Bullard said at an event in Washington on Monday that he “wouldn’t rule out” a 75 basis point rate hike at upcoming central bank meetings. , adding that he would like to see faster movements. of his colleagues to alleviate the inflationary pressures that are building up in the world’s largest economy.
While not his “base case,” Bullard’s comments nonetheless lifted bets on the Fed’s policy trajectory, with CME Group’s FedWatch tool now forecasting a 91% probability of a 50 basis point increase next month, with a 62% chance of a similar increase. pruning moved to June.
The sudden regrouping of Russian troops and tanks in eastern Ukraine’s Donbass region has also unsettled markets as reports suggest a new push on the front established by Ukrainian soldiers early in the last month, which would lead to a worrying escalation of the nearly two-month long period. conflict.
Europe’s Stoxx 600 fell 1.2% at midday in Frankfurt as investors returned from four-day Eastern holiday celebrations in the region, while shares in Asia fell 0.4% during the session amid concerns over Covid-triggered weakness in China. . Japan’s Nikkei 225 posted a 0.7% gain as the yen hit a new 20-year low of 128.42 against the dollar.
In US markets, benchmark 10-year Treasury yields rose to just over 2.9% – the highest since late 2018 – while 30-year yields rose above the 3% mark. for the first time in three years. The dollar index was last seen up 0.2% against a basket of six major global currencies at 100.902.
Stock futures were mixed, with contracts tied to the Dow Jones Industrial Average showing a modest opening bell gain of 22 points and those tied to the S&P 500 priced for a 2-point rise. Rising yields again put pressure on tech stocks, with the Nasdaq rallying 15 points early in trading.
Twitter (TWTR) – Get the report from Twitter, Inc. Shares were active again on Tuesday, rising 0.1% in premarket trading as investors weighed in on reports of potential interest in the social media group from private equity firms as billionaire Elon Musk continues his attack on the board.
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Multiple media reports suggest Apollo Global Management has expressed willingness to use its credit investing platform to support any decision to buy the microblogging website, including Musk’s unsolicited proposal. of $43 billion.
Several stocks were also on the move amid a parade of first-quarter earnings reports, with Johnson & Johnson (JNJ) – Get the Johnson & Johnson report down 1% after posting stronger-than-expected first-quarter profits, but lowered its full-year profit forecast and suspended its guidance for vaccine sales amid what it called a global surplus and declining demand.
Hasbro (POSSESSES) – Get the report from Hasbro, Inc. gained 0.6% as it posted weaker-than-expected first-quarter earnings, but noted rising toy prices and strong demand will drive better earnings by year-end as it seeks to deal with pressure from activist investors.
Lockheed Martin (LMT) – Get Lockheed Martin Corporation report fell 1.4% after stronger-than-expected second-quarter results on Tuesday as investors reacted to soft earnings as supply chain grunts reduced overall sales across its four business divisions at exception of aeronautics.
U.S. airline stocks edged higher after most major carriers dropped their in-flight mask mandates on Monday night following a ruling by a federal judge in Florida.
U.S. District Judge Kathryn Kimball Mizelle said the 14-month warrant, set by the Centers for Disease Control as well as the U.S. Department of Transportation, was illegal in a case filed by a nonprofit interest group called Health Freedom Defense Fund.
United Airlines (LAU) – Get the report from United Airlines Holdings, Inc. shares rose 0.9% to $44.05 apiece while Delta (DAL) – Get the report from Delta Air Lines, Inc. rose 0.69% to $42.50 (LUV) – Get the report from Southwest Airlines Co. gained 0.3% to $46.39 each.
netflix (NFLX) – Get the report from Netflix, Inc. Shares were also front and center ahead of the online streaming group’s first-quarter earnings report after markets closed, with investors focusing on its near-term prospects for customer additions and content spending.
Collective S&P 500 earnings are expected to rise 6.3% from a year ago to $408.3 billion in the first quarter, according to Refinitiv data, before improving slightly to a growth rate 6.4% in the three months ending in June.