Today’s stock market witnessed a meandering journey on Wall Street, marked by a mixed bag of trading following a four-day downward trend.
In the early hours of Thursday, U.S. stock indexes showed signs of indecision, with the S&P 500 edging down by 0.1%, extending its streak of losses to four consecutive sessions. A further decline would mark its lengthiest slump since late October, coinciding with its notable surge to record highs.
Meanwhile, the Dow Jones Industrial Average saw a modest rise of 117 points by 9:45 a.m. Eastern time, while the Nasdaq composite slipped by 0.3%.
Elevance Health saw a notable climb of 4.2% after revising its profit projections upward for the full year, whereas homebuilder D.R. Horton experienced a 3.5% increase following a quarterly performance that surpassed analyst expectations in both profit and revenue.
These gains were partially offset by an 8.2% downturn for Equifax, which reported lower-than-anticipated revenue for the quarter, particularly within its mortgage credit inquiry sector due to the impact of high interest rates.
Stocks have been grappling with challenges lately, particularly as bond yields rise, intensifying pressure amid waning hopes for multiple interest rate cuts by the Federal Reserve this year.
Bond yields saw a slight uptick following reports on Thursday indicating continued resilience in the U.S. economy, with fewer-than-expected jobless claims and accelerated manufacturing growth in the mid-Atlantic region.
Such data, coupled with persistent inflation levels surpassing forecasts, prompted leading Fed officials to suggest a prolonged maintenance of high interest rates until inflation trends closer to the target rate of 2%. This shift in stance comes after earlier indications of potential rate cuts.
Market forecasts now anticipate only one or two rate cuts this year, a significant downgrade from initial expectations of six or more at the outset of the year.
In the bond market, the 10-year Treasury yield rose marginally to 4.62%, while the two-year Treasury yield, more closely aligned with expectations for Fed policy, increased to 4.97%.
While a robust economy sustaining high interest rates offers potential for strong profit growth, companies must deliver such results to justify the soaring stock prices witnessed since autumn.
Noteworthy movements included Comerica’s 2.7% increase following positive analyst outlooks on its 2024 profit forecasts, and Alaska Air’s resilience despite setbacks, projecting better-than-expected profits for the current quarter.
Conversely, Las Vegas Sands saw a 6.9% decline despite outperforming expectations, possibly due to concerns over competitive pressures in Macau.
In international markets, European indexes remained relatively steady, following a trend of modest gains in Asia, with South Korea’s Kospi leading the region with a 2% jump.
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