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Stocks rebound as investors weigh fresh inflation data

Stocks rebound as investors weigh fresh inflation data

U.S. stocks rose Tuesday, clawing back from a sell-off that started the week as investors assessed fresh inflation data out of Washington that showed prices in March further accelerated to a new 40-year high.

The S&P 500 climbed 0.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, and the Dow jumped roughly 130 points at the start of trading. The Nasdaq Composite gained 1.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} after closing sharply lower on Monday. Meanwhile, Treasury yields slightly retreated, but the benchmark 10-year yield remained above 2.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, the highest level since January 2019.

The moves follow a down day on Wall Street to start the week marked by mounting worries of an economic slowdown as war in Ukraine, COVID-19 lockdowns in China and the prospect of a more aggressive Federal Reserve weigh on sentiment. Investors look ahead to the start of earnings season and more economic data set for release this holiday-shortened trading week.

Markets are weighing the latest gauge on inflation in the U.S. The Bureau of Labor Statistics’ (BLS) Consumer Price Index (CPI) rose 8.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in March compared to the same month last year, according to the latest report released Tuesday. The figure marks the fastest rise since December 1981 and follows a 7.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} annual increase in February. Heading into the report, consensus economists were looking for an 8.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} jump for March, according to Bloomberg data.

The red-hot print comes as investors grapple with the likelihood Fed officials will act more aggressively to combat inflation after a hawkish readout of minutes last week from the central bank’s March meeting suggested “many” policymakers “would have preferred a 50 basis point increase” in benchmark interest rates last month.

“I think the Fed is already committed to an aggressive rate hike outlook,” Charles Schwab Chief global investment strategist Jeffrey Kleintop told Yahoo Finance Live on Monday. Tuesday’s CPI data “may not have as much impact [on the markets] as it might’ve, say, a few months ago.”

Although investors are largely prepared for the likelihood Fed policymakers will be more combative in their inflation-fighting efforts, worries have emerged that a ramp up in monetary tightening may cause an economic contraction. Strategists have begun to discuss the possibility of a recession more widely in recent weeks, notably with economists at Deutsche Bank recently warning central bank measures could materially slow growth in the second half of 2023.

Some have said it’s too early to make such a call but that the possibility is on the table.

“I would say that it’s probably closer to a coin toss that the economy will be moving into recession by the end of the year,” said Dreyfus and Mellon Chief economist and macro strategist Vince Reinhart on Yahoo Finance Live.

—

9:30 a.m. ET: Stocks push forward despite report showing red-hot inflation in March

Here were the main moves in markets during Tuesday’s opening bell:

  • S&P 500 (^GSPC): +28.07 (+0.64{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,440.60

  • Dow (^DJI): +100.67 (+0.29{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,408.75

  • Nasdaq (^IXIC): +162.91 (+1.21{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 13,574.87

  • Crude (CL=F): +$4.36 (+4.62{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $98.65 a barrel

  • Gold (GC=F): +$25.20 (+1.29{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,973.40 per ounce

  • 10-year Treasury (^TNX): -6.1 bps to yield 2.7190{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

8:35 a.m. ET: March CPI climbed more-than-expected 8.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} over last year

U.S. consumers paid more for a variety of goods and services in March compared to the prior month as price levels across the economy continued to accelerate amid persisting supply and demand disruptions.

The Bureau of Labor Statistics’ (BLS) Consumer Price Index (CPI) rose 8.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in March compared to the same month last year, according to the latest report released Tuesday. That marked the fastest rise since December 1981. This followed a 7.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} annual increase in February. Heading into the report, consensus economists were looking for an 8.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} jump for March, according to Bloomberg data.

With definitive signs of a peak yet to be seen in inflation, members of the Federal Reserve have escalated their rhetoric on using monetary policy tools to bring down fast-rising prices. Last week, Fed Governor Lael Brainard said that bringing down inflation was “our most important task,” while San Francisco Fed President Mary Daly said that high inflation was “as harmful as not having a job.”

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7:10 a.m. ET: Contracts on S&P 500, Dow, and Nasdaq flat as investors await CPI print

Here’s how the main indexes fared in futures trading ahead of Tuesday’s opening bell:

  • S&P 500 futures (ES=F): +1.25 points (+0.03{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,410.25

  • Dow futures (YM=F): -1.00 points (-0.00{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,218.00

  • Nasdaq futures (NQ=F): +14.25 points (+0.10{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,014.25

  • Crude (CL=F): +$3.81 (+4.04{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $98.10 a barrel

  • Gold (GC=F): +$10.30 (+0.53{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,958.50 per ounce

  • 10-year Treasury (^TNX): +0.00 bps to yield 2.7800{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

6:40 a.m. ET: US small business sentiment falls as inflation worries rise

Confidence levels among small business owners across the country further waned in March, and a higher number of mom-and pop-shop operators reported inflation as their single most important concern, a survey out Tuesday showed.

The National Federation of Independent Business said its Small Business Optimism Index dropped 2.4 points to 93.2 last month to mark the third straight month of readings below the 48-year average of 98. The index has declined every month this year so far.

Of respondents, 31{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} identified inflation as their single most important problem, up 5 points from February’s survey. The figure is the largest share of participants citing inflation as their biggest concern since the first quarter of 1981, also replacing worries about “labor quality” as the number one problem confronting small businesses.

High inflation caused by shortages, massive fiscal stimulus and low interest rates have pressured the economy in recent months.

—

6:10 p.m. ET Monday: Stock futures little change ahead of Tuesday’s inflation data

Here’s where markets were trading ahead of the overnight session on Monday:

  • S&P 500 futures (ES=F): +2.75 points (+0.06{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,411.75

  • Dow futures (YM=F): +29.00 points (+0.08{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,248.00

  • Nasdaq futures (NQ=F): +9.75 points (+0.07{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,009.75

  • Crude (CL=F): +$0.97 (+1.03{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $95.26 a barrel

  • Gold (GC=F): +$9.30 (+0.48{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,957.50 per ounce

  • 10-year Treasury (^TNX): +6.7 bps to yield 2.7800{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., April 11, 2022. REUTERS/Andrew Kelly

A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., April 11, 2022. REUTERS/Andrew Kelly

—

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

Read the latest financial and business news from Yahoo Finance

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Stocks fall for a second day, Nasdaq slides another 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} as Fed gives policy tightening plans

Stocks fall for a second day, Nasdaq slides another 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} as Fed gives policy tightening plans

Stocks fell for a second working day on Wednesday and premiums soared to new heights right after the Federal Reserve gave more advice on how speedy it will tighten financial plan to battle inflation, increasing considerations it may well gradual the economic system.

The Dow Jones Industrial Ordinary fell 144.67 factors, or .42{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, to 34,496.51. The S&P 500 slid .97{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to 4,481.15, and the Nasdaq Composite sank an additional 2.22{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to 13,888.82 immediately after falling about 2.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} on Tuesday.

“It was a warning to any individual who thinks that the Fed is likely to be extra dovish in their fight towards inflation,” stated Quincy Krosby, main equity strategist at LPL Economic. “Their information is, ‘You’re improper.'”

The Fed’s release of its assembly minutes indicated on Wednesday afternoon that officers “typically agreed” it need to shrink its equilibrium sheet by $95 billion for each thirty day period. The minutes also confirmed central bank officers were being thinking of larger sized price hikes than the usual 25-foundation-place, or quarter-level, increments. Shares dipped to session lows just after the release of the minutes but bounced back somewhat to close the day.

“Lots of contributors famous that — with inflation effectively earlier mentioned the Committee’s aim, inflationary pitfalls to the upside, and the federal funds price very well below participants’ estimates of its longer-operate level — they would have most well-liked a 50 basis place enhance in the goal array for the federal resources amount at this meeting,” the minutes explained.

Meanwhile, the 10-calendar year Treasury yield jumped previously mentioned 2.65{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to a 3-calendar year higher on Wednesday and remained close to that large following the launch of the Fed meeting minutes. The level finished Monday at 2.40{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. The minutes were from the Fed’s March conference when it elevated prices by a quarter issue and indicated six additional hikes of that magnitude have been coming this 12 months.

“I imagine the inventory current market is finding the strategy that $60 billion Treasurys and $35 billion in home loans is setting up to get authentic,” reported James Caron of Morgan Stanley Financial investment Management. “If they do a further 50 foundation points hike in Could and yet another 50 in June, it is really starting to get additional actual. It is surely not a tailwind for stocks.”

Tech shares led Wednesday’s slide, slipping all over again for a next day as traders rotated out of the group and braced for greater costs to sluggish the overall economy. Apple, Microsoft, Amazon and Tesla contributed to the sector’s decrease. Chipmakers like Nvidia and Marvell Technology also continued their descent, falling about 5.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and 2.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, respectively.

Traders ongoing to look for for shares with stable profits, shying absent from all those offering long run progress. Utilities, wellbeing treatment and purchaser staples sectors continued to climb Wednesday, with Amgen and Johnson & Johnson rising extra than 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} just about every. Purchaser staples this sort of as Coca-Cola and Procter & Gamble inched far more than 1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} larger. Walmart jumped 2.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

“These days and yesterday you’re seriously beginning to see the equity marketplace catch up with the bond current market,” said Chris Zaccarelli, CIO at Unbiased Advisor Alliance. “And by that, I suggest equities are beginning to rate in a a lot more aggressive Fed. You might be starting off to see a bid for basic safety, you happen to be seeing that common danger-off shift.”

Inventory picks and investing developments from CNBC Pro:

Officials in latest times have tried using to warn buyers even speedier policy tightening could be ahead. The findings, coupled with latest remarks from Fed Governor Lael Brainard and other individuals, seemed to sign that sentiment.

Earlier Wednesday, Philadelphia Federal Reserve President Patrick Harker said that he is “acutely concerned” about soaring inflation, noting that he expects “a series of deliberate, methodical hikes as the yr proceeds and the info evolve.”

His reviews come less than a day following Brainard indicated support for higher fascination charges and stated a “speedy” reduction of the central bank’s stability sheet could arrive as before long as May well. The remarks pushed shares reduce in the previous session.

“It is of paramount significance to get inflation down,” Brainard stated in the course of a Minneapolis Fed webinar. San Francisco Fed President Mary Daly echoed related sentiments toward inflation on Tuesday.

“What that implies for the marketplaces are ongoing volatility around the uncertainty to greater costs and reduced-revenue cash move stocks, growth variety stocks possibly continuing to get discounted as fees increase,” Cliff Corso of Advisors Asset Management stated on CNBC’s “Globally Exchange.”

Earnings in advance

Traders were also bracing Wednesday for the start out of the corporate earnings season.

Goldman Sachs chief U.S. fairness strategist David Kostin stated Wednesday on CNBC’s “Squawk on the Avenue” that shares with “resilient margins” are much better prepared to climate the present-day surroundings. That contains names this sort of as Alphabet and Nike — which have managed “higher and stable margins” even amid the pandemic, he reported.

“Total, the U.S. equities market probably has 5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} upside from these likes between now and the close of the 12 months,” Kostin explained. “Really should we be likely into a recession it will be significant downside, but which is not the base situation suitable now.”

— CNBC’s Patti Domm and Jeff Cox contributed reporting

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Stocks edge lower following back-to-back sell-off

Stocks edge lower following back-to-back sell-off

U.S. stocks fell for a third straight day Thursday following a hawkish readout of minutes from the Federal Reserve’s last policy-setting meeting in the previous session that hinted officials were poised to intervene more aggressively to curb inflation.

The S&P 500 ticked roughly 0.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} lower, while the Dow Jones Industrial Average fell 150 points. The Nasdaq Composite was down 0.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. The tech-heavy index, which began the week with a 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} pop, capped its second consecutive session Wednesday closing 2.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} lower. Meanwhile, the 10-year Treasury yield climbed again to yield 2.637{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} — the highest level in three years.

Conversations detailed in the March 15-16 Fed meeting minutes released Wednesday suggested policymakers will soon begin to unwind the central bank’s $9 trillion balance sheet, including $4 trillion in asset purchases amassed to calm markets after the pandemic hit in early 2020. The minutes also indicated many participants in the Federal Open Market Committee (FOMC) “would have preferred a 50 basis point increase” in benchmark interest rates in March, when the Fed raised rates for the first time since 2018.

“When those minutes were actually released this afternoon, I think what you really saw was the solidification around the news that the Fed is very intent on combating inflation,” U.S. Bank senior vice president Lisa Erickson told Yahoo Finance Live.

Economists at Bank of America, which recently modified its Fed call to include 50 basis point rate hikes in June and July, said in a Wednesday note the newly released minutes show enough evidence to tip the scales towards a double bump increase in May.

“The reality is we are in uncharted waters here and the Fed has a difficult task in unwinding the tremendous monetary support over the past couple years,” Allianz Investment Management senior investment strategist Charlie Ripley said in a note. “Against this backdrop, it is highly conceivable that uncertainty in the path of monetary policy will remain embedded in markets and that is exactly what we have been witnessing with the recent moves in interest rates and risk assets.”

Other headwinds investors have to continue to navigate are developments in the Russia-Ukraine war. The United States imposed another round of sanctions on Wednesday that included a ban on American investments in Russia. The penalties also targeted Russia’s Sberbank and Alfabank, two of the country’s largest financial institutions, as well as President Vladimir Putin’s two adult daughters, Russian Foreign Minister Sergei Lavrov’s wife and daughter, and senior members of Russia’s security council. Missing from the latest punitive measures, however, were energy transactions.

Meanwhile, testifying before the House Financial Services committee on Wednesday, U.S. Treasury Secretary Janet Yellen warned that Russia’s war in Ukraine will stoke “enormous economic repercussions around the world,” including disruptions to the flow of food and energy.

Yellen also said that Russia should be expelled from the Group of 20 major economies forum, and the U.S. will boycott “a number of G20 meetings” if Russian officials participate.

—

9:30 a.m. ET: Stocks fall for third consecutive day as investors weigh Fed minutes

Here were the main moves in markets during the opening bell on Thursday:

  • S&P 500 (^GSPC): -6.00 (-0.13{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,475.15

  • Dow (^DJI): -88.56 (-0.26{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,407.95

  • Nasdaq (^IXIC): -315.35 (-2.22{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 13,888.82

  • Crude (CL=F): +$0.92 (+0.96{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $97.15 a barrel

  • Gold (GC=F): +$8.20 (+0.43{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,931.30 per ounce

  • 10-year Treasury (^TNX): +2.4 bps to yield 2.6330{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

8:37 a.m. ET: New jobless claims fall sharply to lowest since 1968

Applications for unemployment insurance fell sharply in the latest weekly data to the lowest level since 1968 and represented a third consecutive week that new claims were below 200,000, with new layoffs and firings staying low compared to pre-pandemic averages.

The Labor Department latest weekly jobless claims report showed 166,000 claims were filed in the week ended April 2, coming in better than the 200,000 economists surveyed by Bloomberg had expected.

The prior week’s new claims were also markedly downwardly revised to 171,000, from the 202,000 previously reported for the end of March. Prior to the pandemic, new claims were averaging around 218,000 per week throughout 2019.

“The labor market appears to be moving past the pandemic, rapidly closing in on a complete recovery,” Rubeela Farooqi, chief U.S. economist at High Frequency Economics, wrote in a note. “Even as the labor market is tight, suggesting optimism about economic conditions, a four-decade high in prices is tempering expectations.”

Some of the volatility in the most recent weekly jobless claims data likely reflects a change in the way the Labor Department adjusted the figures to account for seasonal factors. Starting in Thursday’s report, the Labor Department returned to using “multiplicative” seasonal adjustment factors for the data, while over the course of the pandemic, the agency had been using “additive” seasonal adjustment factors to help smooth out large shifts in the data.

—

7:40 a.m. ET: HP stock jumps on after Buffett’s discloses 11{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} stake

Warren Buffet’s Berkshire Hathaway in a new filing late Wednesday revealed the company accumulated 121 million shares of HP — an 11.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} stake valued at $4.2 billion.

Shares of HP (HPQ) surged more than 13{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in pre-market trading ahead of Thursday’s opening bell.

“Berkshire Hathaway is one of the world’s most respected investors and we welcome them as an investor in HP Inc,” an HP spokesperson told Yahoo Finance via email.

The purchase is the latest buy in a recent shopping spree by Berkshire Hathaway. Buffet’s company also took a nearly 15{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} stake (worth $7.6 billion) in Occidental Petroleum (OXY) last month.

—

7:10 a.m. ET: Contracts on the S&P 500, Dow, and Nasdaq edge higher after sell-off

Here’s how U.S. stock futures traded ahead of the open Thursday:

  • S&P 500 futures (ES=F): +9.25 points (+0.21{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,485.00

  • Dow futures (YM=F): +15.00 points (+0.04{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,414.00

  • Nasdaq futures (NQ=F): +53.50 points (+0.37{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,558.75

  • Crude (CL=F): +$1.49 (+1.55{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $97.72 a barrel

  • Gold (GC=F): +$6.70 (+0.35{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,929.80 per ounce

  • 10-year Treasury (^TNX): +0.00 bps to yield 2.6090{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

6:13 p.m. ET Wednesday: Futures muted after two-day losing streak

Here’s where markets were trading ahead of the overnight session on Wednesday:

  • S&P 500 futures (ES=F): -3.00 points (-0.07{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,472.75

  • Dow futures (YM=F): -29.00 points (-0.08{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,370.00

  • Nasdaq futures (NQ=F): -1.00 points (-0.01{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,504.25

  • Crude (CL=F): +$1.52 (+1.58{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $97.75 a barrel

  • Gold (GC=F): +$5.00 (+0.26{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,928.10 per ounce

  • 10-year Treasury (^TNX): +5.3 bps to yield 2.6090{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., April 4, 2022. REUTERS/Brendan McDermid

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., April 4, 2022. REUTERS/Brendan McDermid

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Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

Read the latest financial and business news from Yahoo Finance

Follow Yahoo Finance on Twitter, Instagram, YouTube, Facebook, Flipboard, and LinkedIn

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Stocks dip as investors digest hawkish Fed remarks, eye more sanctions

Stocks dip as investors digest hawkish Fed remarks, eye more sanctions

U.S. stocks fell Wednesday as investors eyed more Western sanctions against Russia and digested hawkish remarks from key monetary policymakers. These suggested that more members of the Federal Reserve were open to moving aggressively to raise interest rates and bring down demand and persistently elevated levels of inflation.

The S&P 500 dropped, adding to losses after the blue-chip index ended Tuesday’s session lower by 1.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}. The Dow Jones Industrial Average and Nasdaq also extended declines. In the bond market, the benchmark 10-year Treasury yield rose to top 2.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, marking its highest level since May 2019.

Developments on Russia’s war in Ukraine and the Western response remained in focus Wednesday as the U.S., European Union and Group of Seven readied another round of sanctions on the Kremlin. The U.S. is expected to add penalties to more Russian government officials and family members, and Russian-owned enterprises and financial institutions.

Meanwhile, hawkish commentary from Federal Reserve officials also knocked U.S. equities from their latest march higher and send Treasury yields spiking.

Namely, Federal Reserve Governor Lael Brainard said Tuesday that the Federal Open Market Committee (FOMC) was “prepared to take stronger action” should already elevated indicators of inflation rates and expectations warrant such moves.

Speaking in a webcast, Brainard suggested this could include aggressive interest rate hikes and a much quicker drawdown of the Federal Reserve’s balance sheet — which has thus far ballooned to nearly $9 trillion — than in previous periods.

“Given that the recovery has been considerably stronger and faster than in the previous cycle, I expect the balance sheet to shrink considerably more rapidly than in the previous recovery, with significantly larger caps and a much shorter period to phase in the maximum caps compared with 2017–19,” Brainard said. She noted the process of reducing the Fed’s balance sheet holdings, or beginning quantitative tightening, could begin as soon as the Fed’s next meeting in May.

Other Fed members also suggested they were on board with more policy tightening in the near-term. San Francisco Fed President Mary Daly told the Financial Times on Tuesday that the case for a 50 basis-point interest rate hike — or a hike double the size of the central bank’s typical per-meeting increase — “has grown.”

“The fact is, the Fed has made it very clear … it’s paramount that they go after inflation and do whatever it takes to staunch the rise in inflation,” Quincy Krosby, chief equity strategist for LPL Financial, told Yahoo Finance Live. “They’re going to do it, and I think the market is getting the sense that this is going to be a choppy path.”

“The Fed may go until it breaks something … but it’s clear that this is their mission, and they are going to go ahead with it, full steam – more than 2017, more than 2018,” she added, referring to the last time the Federal Reserve underwent quantitative tightening several years ago.

With inflation rates in the U.S. still holding at around 40-year highs and forcing the Fed’s hand in aggressively tightening financial conditions, some on Wall Street have downgraded their expectations for U.S. and global growth. Deutsche Bank economists said Tuesday they expected the U.S. to tip into a recession at the end of next year as the Fed rapidly hikes rates to address high prices.

“We now expect the U.S. economy to be in outright recession by late next year, and the [Euro area] in a growth recession in 2024 with unemployment edging up,” Deutsche Bank economists David Folkerts-Landau and Peter Hooper said. “Our baseline view is that these developments will spill over to damp growth in much of the rest of the world and at the same time help to bring inflation back toward mandated levels, diminishing the risk of greater disruptions further down the road.”

Still, the economists noted their call for a recession next year “is currently way out of consensus” — and indeed, many on Wall Street still see a slowdown, but not necessarily a period of negative growth in the near-term domestically.

“We’re not thinking that the Fed is going to push the economy into recession,” Veronica Willis, Wells Fargo Investment Institute investment strategy analyst, told Yahoo Finance Live on Tuesday. “I think most are not expecting that. But we are expecting kind of a slowdown in economic growth from what we had expected previously, but still around average economic growth here in the U.S.”

—

9:45 a.m. ET: Bitcoin prices dip below $45,000, pulling down crypto-linked stocks

Bitcoin (BTC-USD) prices fell below $45,000 for the first time since last week on Wednesday, bringing shares of cryptocurrency-linked stocks including Coinbase (COIN), Bakkt Holdings (BKKT) and Riot Blockchain (RIOT) lower as well.

Bitcoin prices have been on a roller-coaster ride this year, tracking the volatility across other risk assets as geopolitical and monetary policy concerns increased. Prices began the year around $48,000 for the largest cryptocurrency by market cap, but dipped as low as below $35,000 so far this year.

Other major cryptocurrencies including Ethereum (ETH-USD), XRP (XRP-USD) and Solana (SOL-USD) also dipped Wednesday morning.

—

9:39 a.m. ET: JetBlue shares drop after airline makes competing bid for Spirit

JetBlue (JBLU) shares dropped Wednesday morning after the carrier made an offer to purchase Spirit Airlines (SAVE) — less than two months after the budget airline agreed to merge with Frontier Group (ULCC).

JetBlue stepped in with $3.6 billion offer to buy Spirit Airlines, with the all-cash deal coming out to $33 per outstanding Spirit share. The combined company would have a fleet of 450 aircraft with another 312 Airbus aircraft to be delivered over the next six years, and would bring more flights to hubs including New York and Florida, where both airlines already operate.

However, in February, Frontier Group made its own bid to buy Spirit for $2.9 billion, in a deal the companies said at the time would save customers about $1 billion per year. JetBlue said in its press release this morning that its offer was a “superior proposal” and that it would be “more effective than Ultra-Low-Cost Carriers in Introducing Competition and Bringing Down Legacy Carrier Fares.”

Wall Street, however, has expressed skepticism over a JetBlue-Spirit tie-up.

“The merits of a potential JetBlue-Spirit merger are not as abundantly clear to us as are those that could stem from other combinations among remaining, non-Big 3 airlines,” JPMorgan airline analyst Jamie Baker wrote in a note this morning.

—

9:31 a.m. ET: Stocks open lower, Treasury yields surge

Here’s where markets were trading Wednesday morning:

  • S&P 500 (^GSPC): -36.19 (-0.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,488.93

  • Dow (^DJI): -229.02 (-0.66{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,412.16

  • Nasdaq (^IXIC): -178.10 (-1.27{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,023.64

  • Crude (CL=F): +$0.51 (+0.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $102.57 a barrel

  • Gold (GC=F): +$2.20 (+0.11{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,929.70 per ounce

  • 10-year Treasury (^TNX): +7.7 bps to yield 2.631{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

8:00 a.m. ET: Mortgage applications fall for fourth straight week as rates rise further

U.S. mortgage applications dropped for a fourth consecutive week into the beginning of April, with fast-rising mortgage rates deterring homeowners from refinancing and new buyers from coming into the market.

The Mortgage Bankers Associations’ weekly index showed mortgage applications fell 6.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} week-on-week during the period ending April 1. This came following a 6.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} drop during the prior week.

Refinances fell 10{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} from the previous week and by 62{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} from the same week last year, bringing overall applications for refinances down to the lowest level since spring 2019. Purchases fell 3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} week-over-week on a seasonally unadjusted basis, and declined 9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} from the comparable period last year.

“Mortgage application volume continues to decline due to rapidly rising mortgage rates, as financial markets expect significantly tighter monetary policy in the coming months. The 30-year fixed mortgage rate increased for the fourth consecutive week to 4.90{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and is now more than 1.5 percentage points higher than a year ago,” Joel Kan, MBA associate vice president of economic and industry forecasting, said in a press statement Wednesday.”

“The hot job market and rapid wage growth continue to support housing demand, despite the surge in rates and swift home-price appreciation,” Kan added. “However, insufficient for-sale inventory is restraining purchase activity.”

—

7:16 a.m. ET: Stock futures fall

Here’s where markets were trading Wednesday morning:

  • S&P 500 futures (ES=F): -38 points (-0.84{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,482.25

  • Dow futures (YM=F): -214 points (-0.62{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,336.00

  • Nasdaq futures (NQ=F): -203 points (-1.37{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,625.00

  • Crude (CL=F): +$1.42 (+1.39{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $103.38 a barrel

  • Gold (GC=F): +$4.70 (-0.24{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,922.80 per ounce

  • 10-year Treasury (^TNX): +8.3 bps to yield 2.637{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

6:10 p.m. ET Tuesday: Stock futures edge higher

Here’s where markets were trading Tuesday evening as the overnight session began:

  • S&P 500 futures (ES=F): +5.25 points (+0.12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,525.50

  • Dow futures (YM=F): +34 points (+0.1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,584.00

  • Nasdaq futures (NQ=F): +25.75 points (+0.17{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,853.75

NEW YORK, NEW YORK - MARCH 30: Traders work on the floor of the New York Stock Exchange on March 30, 2022 in New York City. U.S. stocks opened low after rallying to start the week. (Photo by Michael M. Santiago/Getty Images)

NEW YORK, NEW YORK – MARCH 30: Traders work on the floor of the New York Stock Exchange on March 30, 2022 in New York City. U.S. stocks opened low after rallying to start the week. (Photo by Michael M. Santiago/Getty Images)

—

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.

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Stocks mixed following rally as investors monitor developments in Russia-Ukraine war

Stocks mixed following rally as investors monitor developments in Russia-Ukraine war

U.S. stocks were mixed Tuesday as investors monitored the war in Ukraine and braced for the possibility of new European sanctions against Russia.

The S&P 500 fell 0.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, and the Dow Jones Industrial Average shed 70 points. The Nasdaq Composite was down roughly 0.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} after rallying in the previous session, buoyed by a 27{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} surge in Twitter (TWTR) that came after Tesla (TSLA) CEO Elon Musk revealed he purchased a 9.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} stake in the social media company. Meanwhile, WTI crude oil edged 0.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} higher to $104 per barrel.

Musk is “speaking with his money by saying that Twitter is an undervalued platform,” MKM Partners’ Rohit Kulkarni told Yahoo Finance Live. “He sees there are things they can do to improve the service, and he’s definitely hinting at a more active role.”

Wedbush Securities analyst and Tesla bull Dan Ives also told Yahoo Finance he predicts Musk will have an active stake in the social media platform over the coming weeks or months, and that his recent snap up of shares was “just the appetizer.”

Separately, Musk’s own company, electric-vehicle giant Tesla, contributed to the gains that propelled a take-off for tech during Monday’s trading session. Shares of the EV carmaker jumped nearly 6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} after it reported vehicle delivery figures this weekend that came in higher than the same period last year.

Recession jitters were at bay on Monday after a closely-monitored portion of the Treasury yield curve inverted last week and spooked investors over the possibility of an imminent economic contraction. The phenomenon has a history of predicting a recession, with each of the last eight slowdowns dating back to 1969 preceded by a yield curve inversion. As of Monday morning, the yield on the benchmark 10-year note remained below that on the shorter-term 2-year note.

Still, worries about an economic downturn were not completely off the table for strategists.

Nomura Chief U.S. economist Robert Dent told Yahoo Finance Live he sees the potential for a “mild recession”

“We think that the cumulative risk of a recession between now and the end of 2024 stands at about 35{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to 40{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},” he said. “A lot of that is just coming from what we think is going to be this very aggressive response from the Fed to actually get inflation under control and make sure the labor market actually cools down.”

Uncertainty around the crisis in Eastern Europe also continues to be a headwind for investors. JPMorgan CEO Jamie Dimon in his widely-read shareholder letter warned that the war in Ukraine is likely to meaningfully slow the U.S. and global economy. In the U.S. specifically, the bank estimates the U.S. economy will grow roughly 2.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, a downgrade from the institution’s initial GDP forecast of 3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, with larger cuts to forecasts on Russia and Europe’s economic outlooks.

“We do not know what its outcome ultimately will be, but the hostilities in Ukraine and the sanctions on Russia are already having a substantial economic impact,” said Dimon, adding that “many more” sanctions could be imposed on Russia and spur further unpredictability.

The European Union addressed apparent war crimes in Ukraine on Monday, indicating in a statement that officials would, “work on further sanctions against Russia” over the country’s targeted attacks on civilians. Some major European officials including Germany’s defense minister said they would support banning Russian natural gas — a move previously excluded from sanctions as Russia supplies about 40{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of Europe’s gas energy.

—

9:30 a.m. ET: Stocks dip as investors tune in for more possible sanctions against Russia

Here were the main moves in markets during Tuesday’s open:

  • S&P 500 (^GSPC): -12.78 (-0.28{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,569.86

  • Dow (^DJI): -90.43 (-0.26{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,831.45

  • Nasdaq (^IXIC): +271.05 (+1.90{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,532.55

  • Crude (CL=F): +$0.83 (+0.80{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $104.11 a barrel

  • Gold (GC=F): +$5.50 (+0.28{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,939.50 per ounce

  • 10-year Treasury (^TNX): +4.6 bps to yield 2.4580{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

7:50 a.m. ET: US stops Russian bond payments in move aimed to ramp up pressure on Moscow

The United States stopped the Russian government on Monday from paying holders of its sovereign debt more than $600 million from reserves held at U.S. banks in a bid to place pressure on Moscow.

Foreign currency reserves held by the Russian central bank at U.S. financial institutions were frozen on Feb. 24 as part of sanctions placed on Moscow for over its invasion of Ukraine.

The U.S. Treasury Department, however, had been permitting the Russian government to use funds to make coupon payments on dollar-denominated sovereign debt on a case-by-case basis.

On Monday, the U.S. government moved to cut off Moscow’s access to the frozen funds as a $552.4 million principal payment on a maturing bond came due.

—

7:10 a.m. ET: Stock futures slip, oil rises following Monday’s tech rally

Here were the main moves in futures trading ahead of Tuesday’s open:

  • S&P 500 futures (ES=F): -10.50 points (-0.23{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,567.25

  • Dow futures (YM=F): -83.00 points (-0.24{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,746.00

  • Nasdaq futures (NQ=F): -37.75 points (-0.25{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 15,126.50

  • Crude (CL=F): +$1.28 (+1.24{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $104.56 a barrel

  • Gold (GC=F): -$1.70 (-0.09{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,932.30 per ounce

  • 10-year Treasury (^TNX): 0.00 bps to yield 2.4120{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

6:12 p.m. ET Monday: Futures open little changed after stocks close higher

Here’s where markets were trading ahead of the overnight session on Monday:

  • S&P 500 futures (ES=F): -2.25 points (-0.05{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,575.75

  • Dow futures (YM=F): -14.00 points (-0.04{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,815.00

  • Nasdaq futures (NQ=F): -9.25 points (-0.06{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 15,155.00

  • Crude (CL=F): +$0.43 (+0.42{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $103.71 a barrel

  • Gold (GC=F): +$3.30 (+0.01{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,937.30 per ounce

  • 10-year Treasury (^TNX): +3.5 bps to yield 2.4120{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

Screens display the trading information for Twitter on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., April 4, 2022. REUTERS/Brendan McDermid

Screens display the trading information for Twitter on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., April 4, 2022. REUTERS/Brendan McDermid

—

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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Stocks mixed as EU eyes more sanctions against Russia

Stocks mixed as EU eyes more sanctions against Russia

U.S. stocks were mixed on Monday as investors monitored the potential for more sanctions against Russia amid ongoing concerns over inflation and global economic growth.

The S&P 500 traded flat, while the Dow dipped. The Nasdaq Composite rose about 0.4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} just after market open as technology shares outperformed. Shares of Twitter (TWTR) soared by more than 20{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} after Tesla (TSLA) CEO Elon Musk disclosed he now owns an about 9.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} stake of the social media company.

Investors globally considered the European Union’s next punitive measures against Russia as the more than month-long war in Ukraine escalated further. The EU responded Monday to apparent war crimes in Ukraine, as Russian forces allegedly now widely killed civilians and attacked civilian infrastructure in major cities, with the bloc saying in a statement it would, “as a matter of urgency, work on further sanctions against Russia.” Some major European officials including Germany’s defense minister said they would support banning Russian natural gas — a move previously excluded from sanctions as Russia supplies about 40{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of Europe’s gas energy.

U.S. crude oil prices edged higher Monday morning and looked to rise for the first time in three sessions. Brent crude oil, the international standard, also gained.

JPMorgan (JPM) CEO Jamie Dimon also called attention to the war in Ukraine as one of three key risks he saw to the economic outlook, according to his widely read annual shareholder letter released Monday. The other included “the dramatic stimulus-fueled recovery from the COVID-19 pandemic” as well as “the likely need for rapidly raising rates and the required reversal of QE [quantitative easing]” from the Federal Reserve, Dimon said.

“We do not know what its outcome ultimately will be, but the hostilities in Ukraine and the sanctions on Russia are already having a substantial economic impact. They have roiled global oil, commodity and agricultural markets,” Dimon said. “Our economists currently think that the euro area, highly dependent on Russia for oil and gas, will see GDP growth of roughly 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in 2022, instead of the elevated 4.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} pace we had expected just six weeks ago. By contrast, they expect the U.S. economy to advance roughly 2.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} versus a previously estimated 3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.”

Concerns over the resilience of the U.S. economy in the face of a geopolitical crisis and still-elevated inflation have been fanned further as a closely watched portion of the Treasury yield curve inverted — a move that previously has preceded recessions. As of Monday morning, the yield on the benchmark 10-year note remained below that on the shorter-term 2-year note. Such a phenomenon has occurred before each of the last eight recessions since 1969.

“Investors have been particularly concerned about the prospect of yield curve inversion as a signal for imminent recession,” Goldman Sachs strategist David Kostin wrote in a note. “Our rates strategists recently raised their forecasts and now expect the 2-year UST and 10-year UST yields to end 2022 at 2.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and 2.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, respectively, for a 20 bp [basis point] inversion.”

“However, our strategists note that the nominal curve tends to invert more easily in high inflation environments, which means that it would take a deeper nominal curve inversion than in recent cycles to produce a comparable recession signal,” he added. “Asset indicators imply a 38{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} probability of recession within 24 months.”

—

9:42 a.m. ET: Hertz announces plans to buy EVs from Tesla rival Polestar

Hertz (HTZ) said Monday it planned to purchase as many as 65,000 electric vehicles from Polestar, an automotive start-up competing with incumbents like Tesla in the market for electric vehicles.

The car rental company said it would make these purchases over five years, with availability set to begin this spring in Europe and later this year in North America and Australia.

“For Hertz, the partnership is part of the company’s ongoing commitment to lead in electrification, shared mobility and a digital-first customer experience,” according to the company’s press statement. “In addition to making the fleet available to its business and leisure customers, Hertz is extending EVs to rideshare drivers as a way to further accelerate electrification.”

In October 2021, Hertz previously announced it ordered 100,000 Tesla Model 3 vehicles for delivery in late 2022.

—

9:31 a.m. ET: S&P 500, Nasdaq open slightly higher

Here’s where markets were trading just after the opening bell:

  • S&P 500 (^GSPC): -2.68 (-0.06{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,543.18

  • Dow (^DJI): -80.73 (-0.23{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,737.54

  • Nasdaq (^IXIC): +42.83 (+0.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,304.75

  • Crude (CL=F): +$3.35 (+3.37{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $102.62 a barrel

  • Gold (GC=F): +$10.80 (+0.56{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,934.50 per ounce

  • 10-year Treasury (^TNX): +3.3 bps to yield 2.393{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

—

9:04 a.m. ET: Stocks’ Q1 drop was shallower than previous quarterly declines: BofA

With the second quarter of 2022 now under way, Bank of America took a deeper look into the first quarter’s biggest quarterly decline since the first three months of 2020. The firm found despite the volatility, stocks still fared better than in many cases in the past.

“Despite elevated levels of uncertainty, stocks bounced back in March (S&P 500 +3.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} total return) and closed 1Q just down 4.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} (was down as much as 12.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}),” Savita Subramanian, Bank of America equity and quant strategist, wrote in a note Monday. “But a 4.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} decline in a quarter is smaller than the historical average decline of 6.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} for down-quarters since 1936. Stocks also outperformed both long-term Treasuries (-10.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) and corporate bonds (-7.7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) amid higher rates (10-yr yield +83bps).”

Subramanian also noted that the sector performance during the first quarter — with the energy sector posting its best quarter since 1970 — favored names that have historically outperformed during periods of stagflation, or times with high inflation and low growth.

“The top three sectors YTD (Energy +38{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, Utilities +4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, and Staples -2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) were the best performers during stagflation periods in the past, marked by below-average GDP and rising inflation … while the bottom three sectors (Comm. Svcs. -12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, Cons. Disc. -9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} and Tech -9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) have been the worst performers during stagflation,” she added.

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7:48 a.m. ET Monday: Stock futures edge higher

Here’s where markets were trading Monday morning:

  • S&P 500 futures (ES=F): +5.25 points (+0.12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,544.5

  • Dow futures (YM=F): -3 points (-0.01{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 34,715.00

  • Nasdaq futures (NQ=F): +49.25 points (+0.32{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 14,911.00

  • Crude (CL=F): +$0.75 (+0.76{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $100.02 a barrel

  • Gold (GC=F): +$10.10 (+0.53{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,933.80 per ounce

  • 10-year Treasury (^TNX): +2 bps to yield 2.395{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

NEW YORK, NEW YORK - APRIL 01: Traders work on the floor of the New York Stock Exchange during afternoon trading on April 01, 2022 in New York City. U.S. stocks closed higher on the first day of trading of the second quarter of 2022 after the Department of Labor released a jobs report that showed an increase well above pre-pandemic trends. (Photo by Michael M. Santiago/Getty Images)

NEW YORK, NEW YORK – APRIL 01: Traders work on the floor of the New York Stock Exchange during afternoon trading on April 01, 2022 in New York City. U.S. stocks closed higher on the first day of trading of the second quarter of 2022 after the Department of Labor released a jobs report that showed an increase well above pre-pandemic trends. (Photo by Michael M. Santiago/Getty Images)

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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.

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