Wall Street’s main benchmarks rallied Tuesday for a second straight day to build on a streak of recent gains as investors looked optimistically toward the possibility of a ceasefire negotiation between Russia and Ukraine.
[Click here to read what’s moving markets heading into Wednesday, March 30]
The S&P 500 jumped 1.2%, and the Dow Jones Industrial Average registered a nearly 340-point gain. The tech-focused Nasdaq Composite was up 1.8%, buoyed by a comeback in the sector amid a snap up of risk assets following positive headlines around the conflict in Eastern Europe.
Traders weighed reports that came out of peace talks in Istanbul indicating Russia is expected to deescalate military operations around Ukraine’s capital and northern region, while Kyiv proposed adopting neutral status. The steps mark the first signs of progress towards a peace negotiation.
Big names in the technology sector — Apple, Amazon, and Tesla — each built on gains after bounding back Monday from a rough start to the year, stoked by risk-off sentiment over the liftoff in interest rates by Federal Reserve policymakers and geopolitical turmoil in recent weeks. Apple Inc. (AAPL) marked its longest streak of daily gains since 2003 before the iPhone was even launched helping the stock erase all year-to-date losses and turn positive on the year, according to Bloomberg data.
“Corporate America is in excellent shape — earnings estimates are higher in 2022 now than they were at the start of the year, which is no small feat,” LPL Financial equity strategist Jeff Buchbinder said in a note, adding, however, that the positive outlook was not without risks, particularly around the Fed’s inflation fight. Buchbinder pointed out the S&P 500 registered a 19% correction when the Federal Reserve last bumped rates up three years ago.
“We saw in 2018 what can happen when the market thinks the central bank is getting too aggressive,” he said. “And certainly we would not dismiss the potential for an escalation of the war in Europe and a broader conflict.”
Also weighing on corporate earnings is a slowdown in economic expansion and a challenging margin environment set forth by wage pressures, supply chain woes, materials and labor shortages, and rising commodity price, LPL Financial noted. These factors could make big earnings upside for companies to achieve and leave valuations to do the heavy lifting — but those valuations may not offer enough support to prop the S&P 500 up to 5,000 at year-end.
F.L. Putnam chief market strategist Ellen Hazen echoed a similar view on Yahoo Finance Live Monday.
“As we see inflation across the board for companies, we expect margins to continue to be under pressure,” Hazen said.
Inflation worries are also mounting for everyday Americans. U.S. consumer confidence bounced back in March and remains elevated, according to a fresh read on the Conference Board’s consumer confidence index. But the short-term outlook among Americans reflects less optimism around what’s ahead. The expectations index component of the report dropped to 76.6 from 80.8 in February. Respondents cited inflation — particularly higher gas prices — and the war in Ukraine as the biggest factors weighing on their outlook.
Elsewhere in economic data out Tuesday, U.S. job openings fell last month to marginally retreat from a record high, while vacancies still far outpaced new hires as employers struggled to bring back more sidelined workers. The Labor Department said in its Job Openings and Labor Turnover Summary (JOLTS) on Tuesday that openings totaled 11.266 million in February. This figure follows 11.283 million vacancies in January, according to the Labor Department’s revised figure.
The results will jump start a week of fresh jobs data for March, which includes ADP’s private payrolls (out on Wednesday) and the crucial jobs report (Friday).
Investors got some relief on Monday as the CBOE Volatility Index (^VIX), which measures volatility and serves as a gauge of market sentiment, dipped. Wall Street’s “fear index,” better known as the VIX, settled below 20 for the first time since January after hovering at elevated levels in recent weeks.
Meanwhile, oil prices tanked on Monday after Shanghai implemented a lockdown to curb a surge in COVID-19 infections, renewing fears of a slowdown in demand. WTI Crude Oil futures (CL=F) plunged 9.2% to settle at around $103 per barrel, recording their biggest drop in two weeks.
The war in Ukraine remains on the radar for investors. The Kremlin said Monday that peace talks between Russia and Ukraine may continue this week when officials from both countries meet in Turkey on Tuesday.
“While we cannot and will not speak about progress at the talks, the fact that they continue to take place in person is important, of course,” Kremlin spokesperson Dmitry Peskov told reporters on a conference call.
Peskov added that no major progress had been made in the talks themselves or the possibility of a face-to-face meeting between Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskyy.
4:00 p.m. ET: S&P 500 rises 1.2%, Dow jumps 340 points, Nasdaq jumps 1.8%
Here’s how the main indexes capped out Tuesday’s trading session:
S&P 500 (^GSPC): +56.16 (+1.23%) to 4,631.68
Dow (^DJI): +339.22 (+0.97%) to 35,295.11
Nasdaq (^IXIC): +264.73 (+1.84%) to 14,619.64
Crude (CL=F): -$1.02 (-0.96%) to $104.94 a barrel
Gold (GC=F): -$19.80 (-1.02%) to $1,920.00 per ounce
10-year Treasury (^TNX): -7.7 bps to yield 2.4000%
3:36 p.m. ET: SEC to consider new SPAC amendments in upcoming meeting
The U.S. Securities and Exchange Commission (SEC) may recommend new directives governing special purpose acquisition (SPACs), or “blank check,” companies at its open meeting on Wednesday, according to an agenda released by the regulator.
In the document, the SEC also indicated it will consider whether to propose amendments regarding SPACs, shell companies, the use of projections in regulatory filings and a rule addressing the status of SPACs under the Investment Company Act of 1940.
So far this year, an estimated 13 SPAC deals have fallen apart, outpacing the 18 deals that fell through in all of 2021, PYMNTS reported. Seven firms dropped their listings, with an average would-be market cap of an estimated $425 million.
3:28 p.m. ET: Yield curve briefly inverts for first time since 2019
The market’s most closely watched part of the yield curve inverted very briefly on Tuesday.
Bloomberg data showed the yield on the 10-year U.S. Treasury note (^TNX) briefly dipping below the yield on the 2-year U.S. Treasury at 1:33 p.m. ET on Tuesday afternoon.
The inversion lasted only a few seconds, and by 3:00 p.m. ET (the settlement time for U.S. government bond futures) the curve remained un-inverted with about 0.05% separating the two securities’ yields.
This phenomenon has a strong track record of predicting a recession; each of the last eight recessions (dating back to 1969) were preceded by the yield on the 10-year falling below the 2-year.
Bank of America said in a recent note that a yield curve inversion would be a “distraction” given a U.S. economy that had its fastest labor market recovery (now at a near-historic low unemployment rate of 3.8%) and GDP growth back to pre-pandemic levels.
“In our view, the bottom line is that near-term recession concerns are likely overdone,” wrote BofA Global Research on March 25.
1:28 p.m. ET: Philly Fed chair sees 25-basis-point rate hikes, but open to 50 basis points
Philadelphia Federal Reserve President Patrick Harker said he favors a “methodical” series of quarter-percentage-point interest rate increases but is open to more aggressive half-point hikes if inflationary pressures persist.
“I have penciled in seven … 25-basis-point increases for this year,” including the recently-approved first hik of the year approved by the U.S. central bank March 16, Harker said in an appearance at the Center for Financial Stability in New York.
If there is no improvement in inflation data, “I am open to sending a strong signal with a 50-basis-point increase at the next meeting,” Harker said. He added that new coronavirus restrictions in China could throw a “wrench” into global supply chains and further elevate prices beyond already high levels under pressure from the war in Ukraine and other existing factors.
1:07 p.m. ET: Stocks trade higher and oil prices fall lower
Here were the main moves in markets as of 1:07 p.m. ET:
S&P 500 (^GSPC): +20.84 (+0.46%) to 4,596.36
Dow (^DJI): +99.88 (+0.29%) to 35,055.77
Nasdaq (^IXIC): +141.98 (+0.99%) to 14,496.88
Crude (CL=F): -$2.93 (-2.77%) to $103.03 a barrel
Gold (GC=F): -$25.70 (-1.32%) to $1,914.10 per ounce
10-year Treasury (^TNX): -7.2 bps to yield 2.4050%
11:14 a.m. ET: FDA authorizes second booster dose of Pfizer COVID vax
U.S. regulators authorized second booster dose of Pfizer Inc. (PFE) and BioNTech SE’s COVID-19 vaccine for adults 50 and older amid concerns about waning immunity.
The U.S. Food and Drug Administration also approved a second dose of the booster for people aged 12 and up who have compromised immune systems.
The new boosters are to be administered at least four months after the third dose and expected to offer more protection against severe disease and hospitalization, according to the companies.
Shares of Pfizer were up 0.9% to $53.76 as of of 11:13 a.m. ET.
10:43 a.m. ET: Consumer confidence bounces back but inflation, war worries persist
U.S. consumer confidence bounced back in March and remains elevated, but the short-term outlook among Americans reflects less optimism around what’s ahead.
The Conference Board reported that its consumer confidence index — a gauge of consumers’ perceptions of current conditions and outlook for the future — rose to 107.2 in March from 105.7 in February. Consensus economists projected a read of 107, according to Bloomberg Data.
The business group’s present situation index, which measures consumers’ assessment of current business and labor conditions, also bounced back this month to 153 from 143 in February.
In contrast, the Conference Board’s expectations index dropped to 76.6 from 80.8 in February. The measure is based on consumers’ six-month outlook for income, business and labor market conditions. Respondents cited higher prices — particularly gas prices — and the war in Ukraine as the biggest factors weighing on their outlook.
10:35 a.m. ET: Apple extends gains to turn positive on the year
Apple Inc. (AAPL) shares climbed in early trading, positioning the tech giant back on track for its longest streak of daily gains since 2003 before the iPhone was even launched.
Shares in the world’s largest company rose 1.4% for an 11th consecutive “up” day for the stock, helping it erase all year-to-date losses and turn positive on the year, according to Bloomberg data. The extensive winning streak marks a rare achievement in its more than four-decade stock market history.
The advance reflects $430 billion in added market value over, bigger than the size of Walmart Inc., per Bloomberg.
Apple’s rally comes as stocks broadly rise on optimism around progress in cease-fire talks between Russia and Ukraine.
10:27 a.m. ET: GameStop plunges nearly 8% after trading resumes
Shares of GameStop (GME) took a nosedive early in the session after trading resumed following a halt by the New York Stock Exchange (NYSE) over heightened volatility.
The move threatens to snap the meme stock’s longest winning streak in more than a decade.
GameStop was down 7.7% to trade at $175.04 per share as of 10:25 a.m. ET.
The volatility comes amid renewed enthusiasm for retail investor favorites, including meme-stock counterpart AMC.
10:13 a.m. ET: US job openings edge lower in February
U.S. job openings fell last month to marginally retreat from a record high, while vacancies still far outpaced new hires as employers struggled to bring back more sidelined workers.
The Labor Department said in its Job Openings and Labor Turnover Summary (JOLTS) on Tuesday that openings totaled 11.266 million in February. This figure follows 11.283 million vacancies in January, according to the Labor Department’s revised figure. Economists surveyed by Bloomberg were looking for 11.000 million job openings last month.
According to a study from McKinsey earlier this month, of nearly 600 workers surveyed who voluntarily left their roles without another job planned, 44% said they had “little to no interest” in rejoining the traditional labor force within six months.
“By many measures, the labor market is extremely tight, significantly tighter than the very strong job market just before the pandemic,” Federal Reserve Chair Jerome Powell said in public remarks last week. “There are far more job openings going unfilled today than before the pandemic, despite today’s unemployment rate being higher.”
10:09 a.m. ET: Nielsen sold to PE consortium in $16 billion buyout deal
TV ratings giant Nielsen (NLSN) has been acquired by a group of of private equity firms, led by Elliott Management affiliate Evergreen Coast Capital Corp. and Brookfield Asset Management in an all-cash deal that values the company at $16 billion, including debt.
The deal offers $28 per share share of Nielsen, a premium of 60% since early March when the deal talks were first reported.
The acquisition comes days after the video and TV-ratings firm declined a takeover bid from a group of private equity firms. Nielsen did not name the suitors, but the offer was made by PE companies including Elliott Management.
Shares of Nielsen soared 21% to trade at $26.89 per share as of 10:08 a.m. ET.
9:30 a.m. ET: Stocks extend advances amid progress on Russia-Ukraine ceasefire talks
Here’s how the main indexes opened at the start of trading Tuesday:
S&P 500 (^GSPC): +43.86 (+0.96%) to 4,619.38
Dow (^DJI): +376.03 (+1.08%) to 35,331.92
Nasdaq (^IXIC): +166.96 (+1.16%) to 14,521.86
Crude (CL=F): -$5.80 (-5.47%) to $100.16 a barrel
Gold (GC=F): -$44.30 (-2.28%) to $1,895.50 per ounce
10-year Treasury (^TNX): -5 bps to yield 2.4270%
9:17 a.m. ET: Robinhood offers clients additional trading time for pre- and post-market
Online brokerage Robinhood is extending trading hours for its users from 7 a.m. to 8 p.m. ET in order to allow them to trade during pre-market and after-hours sessions.
Pre-market trading will be available on the app 2.5 hours before markets open at 9:30 a.m., and after-hours trading continues for 4 more hours, until 8:00 p.m. ET, giving investors on the platform an extra six and a half hours of trading.
The company cited post-market quarterly earnings announcements from some companies and activity in foreign markets — such as Asian or European markets — that can influence prices on U.S. stocks among reasons for the extended trading hours.
9:05 a.m. ET: Home price growth picks back up in 2022
Home price growth accelerated in the first month of the year, reversing a slowing pace over the past few months.
Standard & Poor’s reported its S&P CoreLogic Case-Shiller national home price index registered a 19.2% annual gain in January, up from 18.9% in December.
The annual growth rate remains elevated — the fourth highest reading in 35 years. The 20-City Composite posted a 19.1% annual gain, up from 18.6% a month earlier. The 20-City results surpassed analysts’ expectations of a 18.55% annual gain, according to Bloomberg consensus estimates.
“Home price changes in January 2022 continued the strength we had observed for much of the prior year,” said Craig J. Lazzara, managing director and global head of index investment strategy at S&P DJI, in a statement. “Last fall we observed that home prices, although continuing to rise quite sharply, had begun to decelerate. Even that modest deceleration was on pause in January.”
7:10 a.m. ET: Stock futures rise ahead of consumer confidence, jobs data
Here were the main moves in markets ahead of Tuesday’s open:
S&P 500 futures (ES=F): +16.00 points (+0.35%) to 4,584.00
Dow futures (YM=F): +132.00 points (+0.38%) to 34,985.00
Nasdaq futures (NQ=F): +40.75 points (+0.27%) to 15,026.00
Crude (CL=F): +$0.88 (+0.83%) to $106.84 a barrel
Gold (GC=F): -$28.50 (-1.47%) to $1,911.30 per ounce
10-year Treasury (^TNX): -0.00 bps to yield 2.477%
6:16 p.m. ET Monday: Futures open flat after stocks close at 6-week highs
Here’s where the major stock index futures opened Monday evening:
S&P 500 futures (ES=F): +0.25 points (+0.01%) to 4,568.25
Dow futures (YM=F): -14.00 points (-0.04%) to 34,839.00
Nasdaq futures (NQ=F): -10.75 points (-0.07%) to 14,974.50
Crude (CL=F): -$2.43 (-2.29%) to $103.53 a barrel
Gold (GC=F): -$17.60 (-0.91%) to $1,922.20 per ounce
10-year Treasury (^TNX): -1.5 bps to yield 2.477%
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
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