Last Updated: 4:00PM EST
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Stock indices finished today’s trading session in the red. The Nasdaq 100 (NDX), S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) fell 0.01%, 0.37%, and 0.62%, respectively. Furthermore, the U.S. 10-Year Treasury yield increased to 4.06%, an increase of 12 basis points. Similarly, the Two-Year Treasury yield jumped, as it hovers around 4.23%.
Earlier today, Federal Reserve Governor Christopher Waller said that interest rate cuts are on the table for this year if inflation remains under control. Waller emphasized the importance of a “methodical and careful” approach to reducing rates and warned against the expectation of aggressive easing starting as early as March. He also stressed that future decisions on rate cuts would depend on incoming economic data.
On the consumer front, spending continued in December but at a slowing pace. According to the Federal Reserve Bank of New York, the median increase in monthly household spending dropped to 5.0% in December 2023, down from 5.5% in August and 7.1% in December 2022. Still, this is significantly higher than the pre-pandemic level of 2.5% in December 2019.
The survey noted a decrease in the percentage of households making large purchases in the last four months, along with a lowered expectation for spending growth over the next year. Interestingly, if faced with an unexpected 10% increase in income, more households now prefer to pay down debt. These trends reflect a cautious consumer mindset in the face of uncertain economic conditions.
First Published: 4:00AM EST
U.S. Futures inched lower on Tuesday morning ahead of significant bank earnings scheduled for today and upcoming key economic data. Futures on the Nasdaq 100 (NDX), S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) are down by 0.81%, 0.59%, and 0.52%, respectively, at 3:21 a.m. EST, January 16.
Turning to earnings, three major banks, namely Citigroup (C), JP Morgan Chase (JPM), and Bank of America (BAC), kicked off the bank’s earnings season last week. All three delivered mixed earnings reports. Meanwhile, other notable players in the financial sector, such as Goldman Sachs (GS), Morgan Stanley (MS), and PNC Financial (PNC), are scheduled to report their quarterly results today.
Further, Uber (UBER) is reportedly shuttering its alcohol delivery service, Drizly, following its acquisition in 2021 for $1.1 billion. Moreover, Elon Musk, the CEO of Tesla (TSLA) and SpaceX, aims to strengthen his influence within Tesla by increasing his voting control to at least 25% from his current ownership of about 13%.
In the meantime, oil prices were trending lower at the time of writing as a weakening global economic outlook and a stronger dollar outweighed continued disruptions in Red Sea transportation. The WTI crude oil futures were down, hovering near $72.4 per barrel as of the last check.
Elsewhere, European markets opened lower on Tuesday morning as investors awaited comments from the World Economic Forum in Davos, Switzerland. The forum is expected to discuss matters such as rising geopolitical concerns, inflation and supply chain issues, and artificial intelligence.
Asia-Pacific Markets End Mixed on Tuesday
The Asia-Pacific indices ended today’s session on a mixed note.
Hong Kong’s Hang Seng index ended lower by 2.16%, while China’s Shanghai Composite and Shenzhen Component indices closed higher by 0.27%, and 0.31%, respectively.
At the same time, Japan’s Nikkei and Topix indices ended down by 0.79% and 0.82%, respectively.
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