The Nasdaq and S&P hugged the break-even line pretty closely all day but the Dow went into a deep dive again, down 240 by 11 a.m., bogged down mostly by a hit from United Healthcare which accounted for about half of the slide, but recovered to a 118 loss by close. All of this was rather counterintuitive as the PPI came in with good news, in one short day once again boosting confidence that the Fed could now amply justify rate cuts and suddenly pushing the odds of a March cut to an impressive 79.5%, up from 67.6% two days ago. Bank stocks also slid bringing the banking index down 1.26%. Volume remains below average at 10.57 billion.
Stocks end little changed as earnings
offset inflation data
Fri January 12, 2024 4:30 PM
DJ: 37,711.02 +15.29 NAS: 14,970.19 +0.54 S&P: 4,780.24 -3.21 1/11
DJ: 37,592.98 -118.04 NAS: 14,972.76 +2.58 S&P: 4,783.83
+3.59 1/12
NEW YORK, Jan 12 (Reuters) - U.S. stocks closed barely changed on Friday, after
wavering between modest gains and losses, as mixed bank earnings offset
cooler-than-expected inflation news that buoyed hopes for interest-rate cuts
from the Federal Reserve. On Friday,
data showed U.S. producer prices unexpectedly fell in
December as the cost of goods such as food and diesel fuel declined, while
prices for services were unchanged for a third consecutive month, in contrast
to Thursday's hotter-than-expected consumer inflation reading.
Expectations for a rate cut of at least 25 basis points by the Fed in March moved up to 79.5%,
according to CME's FedWatch Tool, from 73.2%
in the prior session. Friday's data also sent Treasury yields lower, although
recent comments by some central bank officials have pushed back on any potential rate cuts.
"The
PPI tells us something that is a little bit different than the CPI,"
said Michael Green, chief strategist at Simplify Asset Management in New York. "It raises the probability that the Fed has the free and clear to
decide to cut interest rates and the equity market really doesn't care
all that much as long as rates are not pushing significantly higher."
The Dow Jones Industrial Average (.DJI) fell 118.04 points, or 0.31%, to 37,592.98. The S&P 500 (.SPX) gained 3.59 points, or 0.08 %, at 4,783.83 and the Nasdaq Composite (.IXIC) rose 2.58 points, or 0.02%, to 14,972.76. For the week, the Dow gained 0.34%, the S&P 500 rose 1.84% and the Nasdaq climbed 3.09%. The gains for the S&P were the biggest weekly percentage rise since mid-December and for the Nasdaq, the largest since early November.
Bank of America (BAC.N) fell 1.06% after its fourth-quarter profit shrank as the lender took $3.7 billion in one-off charges, while Wells Fargo's (WFC.N) warning of a 7% to 9% drop in net interest income in 2024 sent the bank's shares down 3.34%. But Citigroup (C.N) rose 1.04% after reporting a $1.8 billion fourth-quarter loss and saying it expected further job cuts. JPMorgan Chase (JPM.N) edged 0.73% lower after reporting its best ever annual profit and forecasting higher-than-expected interest income for 2024. The S&P 500 Banks index (.SPXBK) ended down 1.26% after falling as much as 1.7%.
The Dow fell, largely due to a 3.37% decline in UnitedHealth (UNH.N) after the company reported higher-than-expected medical costs, accounting for about 120 points of downside pressure to the index. Delta Air Lines (DAL.N) tumbled 8.97% after the carrier scaled down its annual profit outlook. Tesla (TSLA.O) lost 3.67% after trimming prices of some new China models and plans to suspend most car production at its factory near Berlin.
Advancing issues outnumbered decliners by a 1.4-to-1 ratio on the NYSE while on Nasdaq, decliners outpaced advancers by a 1.1-to-1 ratio on the Nasdaq. The S&P index recorded 37 new 52-week highs and no new lows, while the Nasdaq recorded 134 new highs and 86 new lows.
Volume on U.S. exchanges
was 10.57 billion shares, compared with
the 12.06 billion average for the full session over the last 20 trading days.
No comments:
Post a Comment