Stocks move sideways after Monday

U.S. stocks were little changed on Tuesday morning as Wall Street continued a slow start to the week, as investors scrutinized fresh October trade balance figures and awaited results from the election round. two Georgia Senate.

The S&P 500 Index (^GSPC), the Dow Jones Industrial Average (^DJI) and the tech-heavy Nasdaq Composite (^IXIC) does not change in the top market transaction.

Wall Street looks set to recover from a dip on Monday, when sinking stocks while investors digested the first releases in a week full of economic data. According to Bespoke Investment Group, the S&P index will have its sixth day of decline in the past seven trading sessions. A reading of data pointing to continued resilience in various groups of the economy prompted a strong fixation market around the risk that the Federal Reserve will continue to raise interest rates throughout the coming year.

Fed officials, including Chairman Jerome Powell, has largely suggested that the central bank will drop to the half-point mark at their meeting next week after four consecutive 75-basis-point increases. But Friday’s jobs report showed strong job numbers and strong wage growth, the opposite of what the Federal Reserve wants to see in its fight against inflation.

A smaller increase would indicate a new phase for the central bank’s tightening campaign, but wage pressure could lead more officials to raise their benchmark federal funds above 5% next year. , which Wall Street is now predicting.

Jim Reid and colleagues at Deutsche Bank wrote in an early report: “Based on various releases, the Fed’s closing rate expectations priced for May 2023 have increased by 9.5 points. Intraday fundamentals up 5.01%, breaking through 5% again.” note Tuesday morning.

“It was a notable change from just before Friday’s jobs report, when it hit a low of 4.83%, and meant most of the downside moves after President’s Wednesday speech. Chairman Powell has now reversed,” he added.

Officials will have another assessment of inflation on December 13, the first day of the Fed’s two-day policy meeting, when the Labor Department releases its Consumer Price Index for November.

According to Mike Gormley, Equity Institutional Sales at JPMorgan, December got off to a more favorable start in the market as investors “relaxed with the consensus macro positions this year, which is what makes this year a big deal.” happened since the low CPI in mid-November.”

In commodity markets, oil prices continued to trade lower on Tuesday, with crude oil futures at $75.83 a barrel. The recent plunge in oil prices even comes amid further moves by OPEC and its allies led by Russia to cut production and as Chinese officials temporarily ease COVID-related restrictions. eroded consumption from the world’s largest importer.

In the bond market, the 10-year US Treasury note yield edged higher at 3.57% on Tuesday. The dollar also fell slightly.

In company news, PepsiCo (PEP) plans to eliminate hundreds of jobs at the snack and beverage division’s North American headquarters, The The Wall Street Journal reported. The move comes after other companies, including Walmart and Ford, have cut back-office jobs amid economic uncertainty.

Separately, GitLab (GTLB) shares jumped nearly 12% after the company posted third-quarter earnings that beat Wall Street expectations and raised its revenue forecast for 2023.

And on the political front, Georgia voters will cast their ballots on Tuesday in another second-round race that will decide whether Democratic Senator Raphael Warnock can get tough on Republican rival Herschel Walker or not. are not. Although the Democrats have won control of the Senate, both parties have poured a lot of resources into the race.

“Senate seats are only elected every six years with only a third of the seats being elected at a time, a win for either party would make it easier for them to gain control in the 2024 elections and 2026, as that Georgia seat will not be re-elected until 2028,” Reid and colleagues at Deutsche Bank wrote in a note.

Meanwhile, President Joe Biden will visit TSMC’s Arizona plant on Tuesday when the Taiwanese chipmaker said it would triple its planned investment there to $40 billion. Joining Biden on his visit will be Apple CEO Tim Cook, TSMC founder Morris Chang, head of chipmaker Micron Technology Inc., the White House said. Sanjay Mehrotra, and NVIDIA founder and CEO, Jensen Huang, among others.

Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniroromerotv

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