U.S. stocks were volatile on Monday as investors got off to a critical start to the week as they looked to new inflation data to test prospects for interest rate cuts and the start of the first-quarter earnings season.
The Dow Jones Industrial Average (^DJI), the S&P 500 (^GSPC), and the tech-heavy Nasdaq Composite Index (^IXIC) moved up slightly after moving toward the flat line.
Strong jobs data helped boost stocks on Friday, but lingering doubts about the Federal Reserve's determination to cut interest rates could not prevent a weekly decline.
This uncertainty led to a sell-off in US Treasuries last week, and the pressure continued on Monday, with the 10-year Treasury yield (^TNX) rising slightly to above 4.45%. Although the benchmark has narrowed its gains, it remains within reach of the key 4.5% level, which some see as a potential tipping point for a rally toward last year's highs.
Other concerns added to the volatile mood. Divided views on policy among Fed speakers, growing noise over the upcoming U.S. presidential election, and soaring oil prices due to escalating tensions in the Middle East that could fuel inflationary pressures.
All of this brings attention to Wednesday's release of the consumer price index, a key input in the Fed's decision-making and a clue to the continued resilience of the U.S. economy. Investors will be watching for signs of a return to a downward trend in inflation in March after showing signs of solidity earlier this year.
At the same time, the market is bracing for another earnings season, with Delta Air Lines (DAL) on Wednesday gearing up for Friday's big bank results. Wall Street broadly expects the first quarter to set the tone for solid profit growth for S&P 500 companies, raising hopes for a big jump in March's jobs report.
Against this backdrop, gold rose above $2,350 per ounce, setting a new record. Meanwhile, oil prices were at their highest in months as markets appreciated the easing of tensions in the Middle East. Brent crude oil futures (BZ=F) were slightly lower at $90.80 per barrel, while West Texas Intermediate futures (CL=F) were slightly higher at just under $87.
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Crude oil futures prices fall on signs of easing tensions in the Middle East
Oil futures fell about 1% on Monday amid signs of easing tensions in the Middle East.
West Texas Intermediate (CL=F) futures are trading above $85, while Brent (BZ) =F) is trading around the $90 level.
“Nevertheless, rising demand remains a tailwind for crude oil,” Dennis Kistler, senior vice president at BOK Financial, said in a note Monday.
The analyst noted that oil prices have increased by about $7.00 in the past two weeks.
“We need to be careful because in an 'overbought' situation, the fund also had a large long position, which may have pushed the price up a little too quickly,” Kistler said.
WTI has risen about 16% since the beginning of the year. Brent rose 15% during the same period.
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Disney may be lifted from password sharing crackdown
Disney (DIS) has a lot of password sharers to crack down on.
The media giant is expected to begin tightening its controls over password sharing for Disney+ and Hula this June, CEO Bob Iger teased in a television interview Friday.
A new graph (below) from EvercoreISI analyst Vivant Jayant reveals how a crackdown on password sharing could impact the streaming sector's profitability.
Disney will likely follow Netflix's lead in cracking down on password sharing. (Evercore ISI) -
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Watch JP Morgan CEO Jamie Dimon's money-making masterclass in one graph
Want to know why JPMorgan (JPM) investors want Jamie Dimon to remain CEO for another 50 years?
Sure, this guy is the face of the banking world with some of the best relationships in the game, but at the end of the day, he just knows how to make money for his shareholders.
Mr. Dimon's annual letter, published this morning, says it perfectly. See this graph on page 8. It has been shown that JP Morgan's net income has increased approximately six times since his 2005.
A money machine called JP Morgan. (JP Morgan) -
