The S&P 500 and the Nasdaq Composite established fresh intraday all-time highs Monday morning, but the Dow was under pressure, weighed by a slump in Boeing Che is. B.A.,
and Chevron Corp. shares
CVX,
Market participants were also awaiting more insights on the amount of money that banks will be able to distribute to shareholders after passing “stress tests” last week imposed by its regulator.
How are stock benchmarks trading?
-
The Dow Jones Industrial Average
DJIA,
-0.38%
was trading 170 points, or 0.5%, lower at 34,265. -
The S&P 500 index
SPX,
+0.06%
was trading 4 points, or 0.1%, lower at 4,276, after touching an intraday record at 4,288.41. -
The Nasdaq Composite
COMP,
+0.65%
traded 85 points, or 0.6%, higher at 14,446, after setting its all-time intraday peak at 14,460.73.
On Friday, the Dow put in a weekly gain of 3.4%, its largest since the week ended March 12; the S&P 500 rose 2.7% for its sharpest weekly climb since Feb. 5, while the Nasdaq Composite Index gained 2.4% for its steepest weekly rise since April 9.
What’s driving the market?
Markets were trading mixed on Monday, with the Dow weighed by a couple of its constituents, as the broader market faced resistance from energy stocks and financials.
The focus, in the last trading days of June, remains on discussions surrounding infrastructure and the outlook for the economy’s reopening phase as market participants watch COVID variants.
A slight uptick in global tensions were blamed for some early turbulence in markets after U.S. airstrikes overnight in Iraq and Syria.
Meanwhile, a bipartisan infrastructure bill, that could deliver a fresh jolt to business activity in the U.S., while improving roads, bridges and tunnels, was seen making further progress toward being completed after President Joe Biden over the weekend walked back comments that tied the $1 billion infrastructure bill to an antipoverty package.
Worries linger about the persistence of growing pricing pressures in the economy’s recovery phase from COVID remain, but investors will likely shift their attention to data on the labor market, with the latest update on monthly jobs due on Friday.
The Federal Reserve has insisted that it views inflation as a temporary phenomenon but policy makers have said that improvements in the jobs market will be key in its decision as members weigh when to begin curtailing its program of monthly asset purchases and eventually raising its benchmark interest rate, which currently stand at a range between 0% and 0.25%.
A few Fed officials have already said that they are expecting to raise rates as soon as late 2022, while scaling back asset purchases, or quantitative easing, could commence by the beginning of next year.
Chris Larkin, managing director at E-Trade Financial, said that there is cause for optimism after the run-up for benchmarks in June.
“With inflation fears quelled for the moment and banks getting a clean bill of health late last week, the market looks to be in a good place,” he said, in emailed comments.
However, the strategist also advised prudence in expecting markets to climb much higher.
“Even if the market holds its year-to-date return through the end of the month, the SPX would enjoy its second-best first half of the year since 1998. So bottom line, bulls looking for further upside should keep in mind that its already been a heck of a year,” he said.
On the health front, the number of fully vaccinated Americans rose to 131 million, or 46.1% of the total population, according to the latest data from the Centers of Disease Control and Prevention (CDC), while the number of U.S. adults receiving at least one dose increased to 66%. However, in Australia, officials are battling to contain several COVID-19 clusters around the country, in what some experts have described as the nation’s most dangerous stage of the pandemic.
The World Health Organization on Friday urged fully vaccinated people to continue to wear masks to combat the delta variant of the COVID-19 strain.
Later in the session, banks will disclose how much money that they will be able to distribute to shareholders after passing the Fed’s stress tests last week.
Investors were set to weigh comments from Fed officials, including New York Fed President John Williams. Richmond Fed President Thomas Barkin was set to speak at 11:30 a.m. Fed Vice Chair for Supervision Randal Quarles will speak at 1:10 p.m. at a central-bank digital currency event at the 2021 Utah Bankers Association Annual Convention.
Which companies are in focus?
-
Intellia Therapeutics Inc. stock
NTLA,
+39.44%
was in focus as excitement builds over its pipeline of treatments that apply the gene-editing technology known as Crispr-Cas9. -
Chinese ride-sharing company DiDi Global Inc. DIDI, set terms for its much anticipated initial public offering on Monday, with plans to offer 288 million American Depositary Shares priced at $13 to $14 each.
-
Cybersecurity company SentinelOne S set terms for its initial public offering on Monday with plans to offer 32 million shares, priced at $31 to $32 each.
-
Shares of U.K. luxury goods group Burberry BRBY slumped 4% after Marco Gobbetti said he would be leaving the company at the end of the year to take the same role at leather goods maker Salvatore Ferragamo
SFER,
-2.12%
in his native Italy. Burberry said it has begun a search for his successor. -
Virgin Galactic Holdings
SPCE,
-4.89%
gave back some of Friday’s sharp advance, which came after the Federal Aviation Administration granted approval to the company to fly customers into space. Shares were down 4% Monday.
How are other assets faring?
-
The yield on the 10-year Treasury note TMUBMUSD10Y retreated by 5.8 basis points to 1.484%. Yields and bond prices move in opposite directions.
-
The ICE U.S. Dollar Index DXY, a measure of the currency against a basket of six major rivals, was up less than 0.1%.
-
Oil futures retreated, with the U.S. crude benchmark CL00 trading 1.3% lower at $73.10 a barrel. Gold futures GC00 edged higher, up 0.2% at $1,782.10 an ounce.
-
In European equities, the pan-Continental Stoxx 600 SXXP traded 0.3% lower. London’s FTSE 100 declined 0.7%.
-
In Asia, the Shanghai Composite SHCOMP, Japan’s Nikkei 225 NIK and Hong Kong’s Hang Seng Index HSI all ended fractionally lower, falling less than 0.1%.
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