U.S. stocks have been gaining ground since early this week, after concerns over persistent inflation and a slowdown in the U.S. economy have fueled further volatility in recent sessions.
The S&P 500 was up more than 1.5% on Friday, while the Nasdaq was up almost 3%. Dove added over 350 points. The sharp move came after Federal Reserve Chairman Jerome Powell This was confirmed again in an interview with Marketplace Public Radio on Thursday Two more 50-point point rate hikes are on the table for the next two federal meetings, and officials have not “seriously considered” the most drastic 75-point increase. His comments This echoed what other central bank officials said this week.
The day before, the S&P 500 closed within the bearish market strike distance, generally defined as close to at least 20% from the recent record high. The index had fallen to an all-time high of 18% since its close on Thursday, ending Thursday, and was heading towards a weekly fall of 4.7% if positions were at the end of Friday’s session.
The Dow Jones Industrial Average and Nasdaq Composite each went to weekly losses of 3.6% and 6.4%, respectively, on Thursday’s closing prices. As Treasury yields increased and profits fell again this week, 10-year Treasury yields were up about 2.9% on Friday morning. Bitcoin prices Dec. Recovered to trade above $ 30,000 after setting the lowest price since 2020. Luna And broad cryptocurrency echoed throughout the market.
The market boom this week coincided with two major inflation reports that were warmer than expected. Thursday Manufacturer Price Index Last month showed a year-over-year increase in wholesale prices, slightly above the all-time high of 11.5% in March. And this The Consumer Price Index was released earlier this week Last month showed a further 8.3% year-on-year increase in prices paid by consumers.
“Inflation has certainly become a real problem not only for the surface but also for the wider market because the central bank has increased its numbers. [interest rate] Promotions are needed, “said Sonali Pierre, Managing Director and Portfolio Manager, BIMCO. Yahoo Finance Live said on Thursday. “As for the impact of inflation, it’s really at this point that we’re going to see if raising the central bank’s rates, splitting some balance sheet, can remove some of that foam from the foam, because it’s so high, and it’s starting to affect companies – from a pricing perspective, As well as the result of an increase in consumer, gas pump or food and so on.
Other strategists agreed that the central bank’s response to inflation – and how good the economy is as the central bank tightens its financial position in the face of inflation – will be a key factor in seeing markets move forward.
“We’re in an environment where inflation is high right now. The labor market is very tight. The central bank wants to reduce inflation. Said Thursday. “In that context, it’s not ideal for any type of financial asset.”
“[Once] We are getting some kind of real break in inflation, people are more comfortable, it is moderate and moderate [to] The Fed is a stable position that can be very comfortable, and they do not have to move forward too aggressively … I think that’s the main motivator, “Troho said.” Unfortunately, it may take a few more months for the data to start. Make it clear that inflation is definitely below its peak and that the central bank can reach its target within two years. “
“So for now, I think this is definitely a chaotic market,” he added.
11:00 am ET: Amazon faces the longest-running loss among technology sales in 14 years
Last week’s Technology Stock Route pulled a stake in MegaCap technology names from Apple (APL) To Amazon (AMZN) Their achievement max.
Since 2008 Amazon has been heading for its longest losing streak as shares of e-commerce company headed for its seventh consecutive weekly loss. Based on Thursday’s closing prices, the stock was on the verge of a weekly loss of 6.8%, although it was ready to make up for some of those losses in the middle of Friday’s rally.
Apple has also been pushed to become the world’s most valuable company, with Saudi Aramco’s market capitalization overtaking the iPhone maker’s market this week. Shares of Apple were down 19.7% at the end of Thursday, compared to the S&P 500’s 17.5% fall.
10:15 am ET: Consumer sentiment drops to lowest level since 2011: University of Michigan
According to the University of Michigan, consumer sentiment eased to more than a decade in early May as worries about inflation continued.
The The University of Michigan pays close attention to consumer research The index fell to 59.1 in the preliminary May report, while the April reading fell sharply from 65.2. The latest reading marked the lowest since 2011.
Sense declines are “broad-based – as seen in current economic conditions and consumer expectations and income, age, education, geography and political affiliation – and continue the general downward trend of sentiment over the past year,” said John Hsu, director of the Consumer Survey, in a news release. “Consumers’ current financial situation is at its lowest level since a year ago, with 36% attributing the negative outlook to inflation.”
Consumer inflation expectations were raised in May, showing that one-year inflation expectations remained unchanged at 5.4%. However, some strategists say the fall in risk assets over the past several weeks has played an even bigger role in the fall in the headline index.
“I would argue that this fall was a function of the decline in stock prices. We know that U. Mich markets are more sensitive,” Neil Dutta, economics head at Renaissance Macro Research, wrote in an email on Friday morning. “Inflation was certainly an issue but the series of inflation expectations remained unchanged.”
9:33 am ET: Shares open higher
Here are the major moves in the markets until 9:33 am ET:
S&P 500 (GSPC): +43.33 (+ 1.10%) to 3,973.41
Dove (DJI): +241.55 (+ 0.76%) to 31,971.85
Nasdaq (IXIC): +189.64 (+ 1.67%) to 11,560.61
RawCL = F): + $ 3.05 (+ 2.87%) to $ 109.18 a barrel
Gold (GC = F):-$ 24.60 (-1.35%) to $ 1,800.00 per ounce
10 year treasury (DNX): +9.8 bps to earn 2.9150%
7:54 am ET: Tesla shares rise in early trade after Musk says Twitter deal suspended
Tesla Shares (DSLACEO Elon Musk announced plans to buy Twitter for $ 44 billion, up 6% from early Friday morning.TWTR) Paused, more details about how many Bot accounts there are on Twitter’s app site are pending.
“Twitter agreement suspends pending details supporting support estimate that spam / fake accounts actually represent less than 5% of users,” Musk said. Said in a Twitter post early Friday morning. He linked the Reuters story to the fact that Twitter posts show fake or spam accounts to less than 5% of the company’s daily active users who can monetize.
Musk, who announced his deal to buy Twitter last month, said targeting bot accounts and authorizing users is one of the company’s priorities for a post-contract.
Shares of Twitter fell 11% in early trading to $ 40 each.
7:45 am ET Friday: Stock futures rise after Powell reaffirms 75 basis point hikes
Here is where the markets traded higher than the opening hours of Friday morning:
S&P 500 Futures (EN = F): +46 points (+ 1.17%) 3,973.25
Dow Futures (YM = F): +262.00 points (+ 0.83%) to 31,914.00
Nasdaq Futures (NQ = F): +206.75 points (+ 1.73%) to 12,154.00
RawCL = F): + $ 1.79 (+ 1.69%) to $ 107.92 a barrel
Gold (GC = F):-$ 7.90 (-0.43%) to $ 1,816.70 per ounce
10 year treasury (DNX): +9.8 pps yield 2.915%
6:10 pm and Thursday: Shares open lower
Here is where Thursday evening markets trade:
S&P 500 Futures (EN = F): -10 points (-0.25%) 3,917.25
Dow Futures (YM = F): -73 points (-0.23%) 31,579.00
Nasdaq Futures (NQ = F): -41 points (-0.34%) 11,906.25
Emily McCormick is a Yahoo Finance correspondent. Follow her on Twitter.
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