The Dow was up as much as 300 points in the morning only to come crashing down shortly after 11 to finally settle near break-even at close.  The high was the market still confident that the big job numbers from last week might prompt more rate hikes but that the economy would be okay anyway. In the afternoon, the concerns migrated once again over fears of recession and hedging bets awaiting Wednesday’s CPI data for a better reading on inflation. Volume came in at 11 billion. 

Mon  August 8, 2022  6:52 PM

Wall Street closes little changed on Fed policy fears

By Herbert Lash and Bansari Mayur Kamdar

DJ: 32,803.47  +76.65        NAS: 12,657.56  -63.02        S&P: 4,145.19  -6.75        8/5

DJ: 32,832.54  +29.07        NAS: 12,644.46  -13.10        S&P: 4,140.06  -5.13        8/8

Aug 8 (Reuters) - Wall Street closed mostly flat on Monday after blockbuster jobs data last week reinforced expectations the Federal Reserve will crack down on inflation, while a revenue warning from chipmaker Nvidia reminded investors of a slowing U.S. economy.  Stocks retreated from earlier highs as last week's blowout labor market report was initially seen as a sign the economy could withstand aggressive interest rate hikes by the Fed to tame inflation running at four-decade highs.  Investors now await consumer price data on Wednesday to gauge whether the Fed might ease a bit in its inflation fight and provide better footing for the economy to grow. read more

"The CPI data will help to confirm if the Fed's tightening efforts have been successful in starting to tame inflation or if continued Fed tightening is needed," said Robert Schein, chief investment officer at Blanke Schein Wealth Management.

The Dow Jones Industrial Average (.DJI) rose 29.07 points, or 0.09%, to 32,832.54, while the S&P 500 (.SPX) lost 5.13 points, or 0.12%, to 4,140.06 and the Nasdaq Composite (.IXIC) dropped 13.10 points, or 0.1%, to 12,644.46.

Volume on U.S. exchanges was 11.01 billion shares.

The S&P 500 has bounced back 14% from mid-June lows. But signs of inflation running too hot could cement the Fed's case for aggressive monetary policy tightening. read more  Anthony Saglimbene, chief market strategist at Ameriprise in Troy, Michigan, said the market was due to pull back at some point as traders test the recent rebound.  "Maybe we can get a little bit higher by year end, but that's if everything lines up perfectly," he said, adding that the University of Michigan's preliminary consumer sentiment survey for August on Friday also will be closely watched.  "That's the tug of war between these data sets that tell the story about, 'Hey, are we going to turn into a recession or avoid one?'"

U.S. rate futures have priced in a 67.5% chance of a 75-basis-point hike at the Fed's next meeting in September, up from about 41% before the labor market data beat market expectations. FEDWATCH  The information technology sector (.SPLRCT) fell 0.9% as chipmaker Nvidia Corp (NVDA.O) slid 6.3% after the company said it expects second-quarter revenue to decline 19% from the prior quarter to about $6.7 billion, due to weakness in gaming.  The Philadelphia SE Semiconductor index (.SOX) slid 1.6%, while value stocks (.IVX) rose 0.1% to outpace a 0.4% drop in growth.

Tesla (TSLA.O) rose 0.8% as the U.S. electric-car maker signed contracts worth about $5 billion to buy battery materials from nickel processing companies in Indonesia, according to a CNBC report. read more

Shares of U.S. automakers jumped after the U.S. Senate on Sunday passed a $430 billion bill to fight climate change that created a $4,000 tax credit for used electric vehicles and provides billions in funding for their production. read more  Rivian Automotive Inc (RIVN.O) rose 6.78%, Ford Motor Co gained 3.14%, General Motors Co (GM.N) added 4.16% and Lordstown Motors Corp (RIDE.O) advanced 3.17%.  Signify Health Inc shot up 11.0% on a media report that CVS Health Corp was looking to buy the health technology company.  Palantir Technologies Inc (PLTR.N) dropped 14.2% after the data analytics software company lowered its annual revenue forecast as the timing of some large government contracts remained uncertain. read more  Tyson Foods Inc (TSN.N) fell 8.4% after missing quarterly profit expectations. read more

Advancing issues outnumbered declining ones on the NYSE by a 2.28-to-1 ratio; on Nasdaq, a 1.67-to-1 ratio favored advancers.  The S&P 500 posted eight new 52-week highs and 29 new lows; the Nasdaq Composite recorded 104 new highs and 27 new lows.