Last Updated 4:00PM EST
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Stocks finished today’s trading session in the red, as the Dow Jones Industrial Average, the S&P 500, and the Nasdaq 100 fell by 1.81%, 1.56%, and 1.27%, respectively.
Meanwhile, bond yields decreased, as the U.S. 10-Year Treasury yield is now hovering around 3.37%. This represents a decrease of more than 18 basis points from the previous close.
Similar movements can be seen with the Two-Year yield, which is now at 4.09%. As a result, the spread between the 10-Year and Two-Year U.S. Treasury yields is still negative, as it currently sits at -72 basis points.
Taking a look across the Atlantic, inflation in Europe is starting to ease. CPI and core CPI in the UK came in at 10.5% and 6.3% on a year-over-year basis, respectively. Similarly, the European Union saw CPI and core CPI of 9.2% and 5.2%, respectively.
However, investors shouldn’t get too excited trying to catch a bottom any time soon as inflation is still nowhere near under control. Thus, central banks will be forced to maintain restrictive interest rates, which will equate to continued pressure on stocks.
Last Updated 1:00PM EST
Stock losses accelerate in the second half of today’s trading. As of 1:00 p.m. EST, the Dow Jones Industrial Average, the S&P 500, and the Nasdaq 100 are down 1.3%, 1.1%, and 1%, respectively.
Last Updated 11:10AM EST
Stocks are in the red after an optimistic start to today’s session. As of 11:10 a.m. EST, the Dow Jones Industrial Average, the S&P 500, and the Nasdaq 100 are down 0.8%, 0.4%, and 0.4%, respectively.
The Federal Reserve released its U.S. Industrial Production report, which measures the change in the total value of output produced by manufacturers, utilities, and mines. These figures are adjusted for inflation.
For December, industrial production decreased by -0.7% on a month-over-month basis. This was worse than the -0.1% that was expected and a decline from the previous month’s report of -0.6%.
When looking at the year-over-year number, it increased by 1.65%. This was also lower than last month’s reading of 2.18%. Overall, growth has been trending lower after reaching its peak of 7.51% in February 2022.
Industrial production is clearly slowing down as a result of higher interest rates, which has caused many businesses and consumers to become more cautious.
Last Updated 9:39AM EST
The Dow Jones Industrial Average (DJIA) climbed 0.04% while the S&P 500 (SPX) inched up 0.20%, as of 9:39 a.m. EST, Wednesday. Meanwhile, the Nasdaq 100 (NDX) futures advanced 0.46% as the producer price inflation came in lower than anticipated at 6.2%+ and retail sales dropped by 1.1% for the month of December.
Banking Earnings Spur Mixed Feelings
U.S. stock futures climbed Wednesday morning as corporate earnings and economic updates keep investors busy this holiday-shortened week.
Shares of Goldman Sachs (NYSE:GS) dipped more than 6% on Tuesday after its biggest earnings miss in about a decade. Meanwhile, peer Morgan Stanley (NYSE:MS) gained nearly 6% on upbeat 4Q results that reflected remarkable growth in wealth management revenues.
Goldman Sachs also announced that it is preparing for mass layoffs soon, the first large-scale layoffs in the financial sector. This indicates that the Federal Reserve’s monetary policy might be successfully reaching its aim of slowing the labor market.
The starkly different earnings results from two major banking stocks kept investors’ hopes up for more earnings this week.
More Corporate Updates That are Keeping the Market Green
Shares of United Airlines (NYSE:UAL) climbed almost 3% in Wednesday’s premarket trading after the company posted earnings and revenue beats in its latest reported quarter.
Shares of Moderna (NASDAQ:MRNA) surged more than 8% in Wednesday’s premarket session after the pharmaceutical company announced that its vaccine for respiratory synytial virus can protect older adults against the disease.
On Tuesday, the S&P 500 lost 0.2% and the Dow shed 1.14%. Meanwhile, the Nasdaq 100 gained 0.14%.
Since this week is packed with earnings as well as economic updates, the market seems to be yet to factor in the earnings reports. The coming week is a relatively quiet week on the economic data front, and hence markets may see more volatility in response to earnings.
Economic Reports Keep Investors Busy
A slew of economic reports is due on Wednesday, including December’s producer price index (measuring the rise in wholesale prices) and retail sales.
The Dow Jones conducted a survey of economists, whose consensus was found to be expecting the wholesale price inflation reading to have dipped 0.1% in December, compared to a 0.3% rise in November. Additionally, December’s retail sales number is expected to have dropped 1%, after November’s decline of 0.6%.
Interestingly, The Wall Street Journal revealed that many companies are now resorting to taking measures to boost sales after suffering customer reduction due to the rising prices of their offerings. Companies are now either pausing or slowing the pace of their price hikes, and marketing new sales-boosting discounts and offers.
This indicates that the economy might be on a slow but sure road to deflation.
Interested in more economic insights? Tune in to our LIVE webinar.
