On Monday, U.S. stock markets reflected a mixed performance as investors braced themselves for upcoming economic data releases and awaited crucial insights from Federal Reserve Chair Jerome Powell’s speech. By 9:47 a.m., the Dow Jones Industrial Average had fallen by 226.69 points, or 0.54%, landing at 42,086.31. Meanwhile, the S&P 500 saw a slight drop of 0.08%, losing 4.52 points to reach 5,733.65. In contrast, the Nasdaq Composite showed positive movement, gaining 44.41 points, or 0.25%, to hit 18,164.00.
This market fluctuation came as investors focused on Powell’s scheduled remarks on the economic outlook at the National Association for Business Economics event, where his commentary on inflation, interest rates, and future monetary policies could significantly impact the direction of the stock market.
Economic Data Releases Awaited
The week ahead holds several key data releases, including the much-anticipated jobs report for September and updates on the S&P manufacturing and services PMIs. These reports are likely to provide a clearer picture of the U.S. economic trajectory and potentially influence market expectations about future interest rate hikes from the Federal Reserve.
Stock Movements: Automakers and Chinese Tech Giants
Shares of major U.S. automakers had a challenging start to the week. Ford Motor dropped 2.2%, and General Motors fell by 3%. The decline was partly triggered by European automaker Stellantis NV cutting its annual forecasts, which raised concerns about the global auto industry.
In contrast, Chinese tech stocks listed in the U.S. posted gains after China’s central bank announced a plan to lower mortgage rates for existing home loans, providing relief to the country’s property market. Alibaba shares rose by 3.5%, Li Auto surged by 6%, and PDD Holdings gained 3.3% on the back of this positive news.
Cruise Industry Takes a Hit Despite Strong Performance
Despite posting stronger profits and revenues for the second quarter, Carnival shares fell by 4.1%. The decline signals that investors might be cautious about the cruise industry’s outlook, possibly due to concerns over future travel demand and rising costs.
Treasury Yields and Commodities Market
In the bond market, the 10-year Treasury yield held steady at 3.75%, while the 2-year Treasury yield inched up to 3.59% from 3.56%. These movements in yields reflect the ongoing uncertainty around the Federal Reserve’s next steps regarding interest rates.
Meanwhile, oil prices also took a downturn. Brent crude futures for November delivery, which expire today, fell by 0.5% to $71.63 per barrel. U.S. West Texas Intermediate (WTI) crude futures dipped by 0.2% to $68.06 per barrel. The decline is attributed to a strong supply outlook, which has kept prices in check despite geopolitical tensions and other factors.
Gold and Silver Decline Amid Market Caution
Gold prices eased as well, with spot gold down 0.9% at $2,634.01 per ounce. U.S. gold futures also dropped, slipping by 0.5% to $2,655.40 per ounce. Silver followed suit, with prices dipping 1.6% to $31.13 per ounce. The drop in precious metals indicates that investors are moving away from safe-haven assets as they await clearer signals from the Federal Reserve and economic data.
As the week progresses, markets will closely watch for Powell’s comments and economic data that could shape expectations for future rate hikes and broader economic growth. Investors remain cautious but hopeful that the upcoming reports will shed light on the direction of the U.S. economy, particularly regarding inflation and labor market trends.
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