- Wall Street closed mixed on the first day of the week.
- Details of ISM Manufacturing PMI warrants caution, US Treasury yields cheered Friday’s Core PCE Price Index.
- Fedspeak keeps struggling to convince markets of no tapering.
US equities fail to offer an upbeat start to the short week with an uneven closing on Tuesday as upbeat Treasury yields and sluggish details of the key data probed bulls. Also on the same line could be the comments from the US Federal Reserve (Fed) policymakers that flash mixed signals of late.
While the headline US ISM Manufacturing PMI jumped above 60.7 forecast to 61.2 in May, employment and inflation components could neither suggest upbeat jobs report for Friday nor back the relfation woes. Furthermore, Federal Reserve Governor Lael Brainard and Vice Chairman for Supervision Randal Quarles pushed hard to reject reflation fears but St. Louis Federal Reserve (Fed) President James Bullard kept cheering the strong job market, indirectly favoring the tapering concerns.
It’s worth noting that the energy prices jumped after the joint technical committee of the Organization for the Petroleum Exporting Countries (OPEC) forecasts oil inventories will fall by at least 2 million barrels a day from September through December, per Bloomberg. It should, however, be kept in mind that the OPEC+ remained stuck to their plans of easing production cuts.
Amid these plays, Dow Jones Industrial Average (DJI) gained 45.86 points, or 0.13%, to close at 34,575.31. However, the S&P 500 and Nasdaq closed the day with mild losses of around 0.05% and 0.09% respectively while closing Tuesday’s trading near 4,200 and 13,735 in that order. The US 10-year Treasury yield’s 1.3 basis points (bps) of the run-up to 1.60% is also a notable market move.
Stock-specific details suggest a slump in Abbott Labs shares on a downwardly revised forecast while AMC Entertainment Holdings jumped on the company comments relating to stock selling.
Moving on, the economic calendar doesn’t offer any key catalysts for Wednesday but chatters concerning the Fed’s next moves, stimulus and reflation may keep entertaining the market players. Though, cautious sentiment ahead of Friday’s US Nonfarm Payrolls (NFP) could keep the traders in check.
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