Last Updated 4:00 PM EST
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Stock indices finished today’s trading session mixed as investors continue to wait for the debt ceiling drama to end. The Nasdaq 100 (NDX) gained 0.4%, while the S&P 500 (SPX) remained flat. On the other hand, the Dow Jones Industrial Average (DJIA) fell 0.15%.
Earlier today, Tom Barkin, the President of the Richmond Federal Reserve, expressed concerns about the current state of U.S. interest rates, noting that they’ve entered a restrictive phase. He also drew attention to the stubbornly high inflation, which remains above the 2% goal set by the Fed despite recent minor decreases.
Barkin underscored the prevailing uncertainty on the appropriate duration for these restrictive measures, suggesting that it would be a key point of discussion at the upcoming Fed meeting.
He also touched on persistent supply chain disruptions, particularly in the automotive sector, and a noticeable trend among businesses to push up prices until they meet customer pushback. However, he admitted that taming inflation might be a slow process due to its tenacious character. As for wages, Barkin noticed a deceleration in their growth, adding that wage increases are largely being influenced by price hikes at the moment.
When it came to the commercial real estate market, he noted that areas like warehousing, institutional properties, and existing multifamily buildings are fairing well, whereas the lower-grade downtown office spaces are facing challenges.
In addition, compared to Friday, the market is pricing in a higher chance of a lower Fed Funds rate for December 2023. In fact, the market’s expectations for a rate in the range of 4.75% to 5% increased to 31.5% compared to Friday’s expectations of 27.5%.
In addition, the market is now also assigning a 16.6% probability to a range of 5.25% to 5.5%. For reference, investors had assigned a 21.3% chance Friday.
Last updated: 12:17PM
Stocks are mixed halfway into today’s trading as the optimism seen at the open fades. At the time of writing, the Nasdaq 100 (NDX) and the S&P 500 (SPX) are up 0.6% and 0.03%, respectively. Meanwhile, the Dow Jones Industrial Average (DJIA) is down 0.4%.
On Tuesday, the Conference Board released its Consumer Confidence report, which, as the name suggests, measures the consumers’ confidence in the economy. This report is believed to be a leading indicator for spending patterns, as optimistic consumers are more likely to spend as opposed to pessimistic ones.
For May, consumer confidence came in at 102.3, which was higher than expectations of 99. However, this is lower than last month’s reading of 103.7. It’s worth noting that consumer confidence has been in an overall downtrend since its June 2021 peak of 128.9. In addition, compared to May 2022, sentiment declined by 0.87% on a year-over-year basis.
Last updated: 9:30AM
The Nasdaq 100 (NDX), S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) were up by 1.1%, 0.55%, and 0.06%, respectively, at 9:30 a.m. EST, May 30.
According to the S&P CoreLogic Case-Shiller Home Price Index (HPI) data released today, home prices continued to tick higher for the second consecutive month in March. The seasonally adjusted HPI Composite for 20 cities is up by 0.5% versus consensus forecasts of a decline of 0.4% and a fall of 0.1% in February.
First published: 5:35AM
U.S. Futures are inching higher this morning as traders react positively to the developments on the U.S. debt limit deal. Futures on the Nasdaq 100 (NDX), S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) were up 0.64%, 0.37%, and 0.16%, respectively, at 4:00 a.m., EST, May 30. U.S. markets will resume today after a three-day break.
The deal to raise the $31.4 trillion debt ceiling needs bipartisan support before being signed by the President. Reports state that a handful of hard-right Republican lawmakers are opposing the deal, with Congress likely to vote on it this Wednesday.
Once the U.S. debt default scenario is behind us, traders will eye May’s employment report and April JOBS data, due later this week. These economic datasets would give us a clue into the Federal Reserve’s next interest rate decision.
Meanwhile, chip maker Nvidia (NASDAQ:NVDA) continues to capitalize on the AI boom with the launch of its new large-memory AI supercomputer, the NVIDIA DGX GH200, aimed at building generative AI models, which could make anyone a programmer.
On the earnings front, personal computer manufacturer HP Inc. (NYSE:HPQ), Hewlett Packard Enterprise (NYSE:HPE), and Victoria’s Secret (NYSE:VSCO) will report today.
European indices are trading mixed today following news that some Republican lawmakers may find it difficult to approve the U.S. debt ceiling deal. Further, the British Retail Consortium released figures for U.K. shop price inflation, which reached a record-high growth of 9% year-over-year in May.
Asia-Pacific Markets Today
Asia-Pacific indices ended the trading session mixed today, following updates on the U.S. debt ceiling deal. Notably, Japan’s unemployment rate fell marginally to 2.6% in April.
Hong Kong’s Hang Seng index and China’s Shanghai Composite and Shenzhen Component indices ended the day up by 0.24%, 0.08%, and 0.44%, respectively.
At the same time, Japan’s Nikkei ended up by 0.30%, marking a new high of the last three decades, while the Topix index ended marginally down by 0.06%.
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