JPMorgan Chase – Stocks Trade Mixed with Technology Shares
U.S. stocks on Tuesday closed mixed, paring previous gains as technology firms slowed down.
The Dow only gained 45 points, or 0.1 per cent, after hitting session highs. The S&P 500 finished slightly below the flat line, just like Nasdaq. Treasury rates increased throughout the curve, with the benchmark 10-year yield hovering around 1.6 per cent. Brent and US crude oil prices rose as OPEC + predicted that oil stocks will continue to decline as the post-pandemic recovery progresses later this year.
Over the last few weeks, top stocks and shares ISA investments are temporarily under the microscope following fears about rapidly rising prices for consumer and producer goods during the economic recovery to rest, especially after Federal Reserve officials reassured market participants that they did not see inflationary pressures warranting a change in monetary policy in the near term. Nonetheless, inflation hedges such as precious metals outperformed the market in May, indicating a fear of increasing costs. Silver was the best-performing non-currency asset monitored by Deutsche Bank, with an 8.1 percent gain, followed by gold with a 7.9 percent gain, the bank’s analysts stated in a report Tuesday.
Inflation expectations are on Wall Street’s mind ahead of the government’s report on Thursday, which is expected to reveal consumer price inflation climbed to 4.6 per cent year over year in May, according to an Econoday consensus estimate. This would be a faster rate than April’s 4.2 per cent reading, which was the highest since 2008.
To foster economic development, the Federal Reserve has stated that it will withstand higher inflation. However, minutes from the central bank’s most recent meeting show policymakers are ready to start talking about cutting stimulus, prompting investors to question when the Fed would start raising interest rates in the face of strong inflation.
Meanwhile, investors will be watching to see how US lawmakers respond to Treasury Secretary Janet Yellen’s worldwide tax arrangement. Officials from the Group of Seven leading countries agreed on Saturday to establish a 15% corporate minimum tax. Republican politicians and business groups are expected to oppose the agreement.
Gold lost 0.3 per cent to $1,885.63 per ounce in the markets. US Treasury rates have risen, with the 10-year yield reaching 1.57 per cent.
The price of oil has dropped. West Texas Intermediate crude fell 0.3 per cent to $69.40 a barrel, a loss of 0.3 per cent. Brent crude, the global benchmark for oil, fell 0.3 percent to $71.65 a barrel.
The Nasdaq is falling as tech stocks plummet
On Tuesday, stocks reversed direction and traded largely down, with highly weighted technology stocks driving down both the S&P 500 and the Nasdaq. The S&P 500 remained close to flat, while the Nasdaq fell 0.2 per cent.
In the S&P 500, the cyclical energy, materials, and financials sectors outperformed, while health care, utilities, and information technology underperformed. Dow outperformers were Chevron, Goldman Sachs, and American Express, while Johnson & Johnson and Salesforce trailed.
Seven of the S&P 500’s core 11 industry groupings rose, with health-care companies leading the way. Large banks including JPMorgan Chase & Co., Bank of America Corp., and Wells Fargo & Co. were among the worst-hit laggards in the wider index, as were financial stocks. The Nasdaq 100 gained the most thanks to Amazon.com Inc., Microsoft Corp., and Tesla Inc. Financial stocks like Goldman Sachs Group Inc. and American Express Co. weighed on the Dow Jones Industrial Average, which closed the day barely changed.