NEW YORK: US stocks ended higher on Monday (July 10) following last week's losses, while Federal Reserve officials’ comments bolstered the view that the US central bank may be near the end of its tightening cycle.
The Dow Jones Industrial Average rose 209.52 points, or 0.62%, to 33,944.4, the S&P 500 gained 10.58 points, or 0.24%, at 4,409.53 and the Nasdaq Composite added 24.77 points, or 0.18%, at 13,685.48.
The S&P 500 added to slight gains before the close, with caution prevailing for much of the session ahead of Wednesday’s consumer prices report and the start of second-quarter earnings later this week.
“There is a bit of indecision,” said Angelo Kourkafas of Edward Jones, describing a “waiting game” for Wednesday’s consumer price index data, a key input for Federal Reserve policy.
Kourkafas said the market was still in a “digestion” phase following the strong first half of 2023, but noted that stocks could be poised for further gains if US economic data remains good.
Investors are anxious to see if price pressures are continuing to moderate. That could shed light on the interest rate outlook, with many traders expecting the Fed to raise interest rates by 25 basis points this month.
Several Fed officials said on Monday additional interest rate increases are needed to bring down inflation that is still too high, but the end to the US central bank's current monetary policy tightening cycle is getting close.
“The market is obviously poised for the opening of earnings season,” but investors are also hyper-focused on consumer prices and a heavy roster of Fed speakers this week, said Quincy Krosby, chief global strategist at LPL Financial in Charlotte, North Carolina.
The outlook for interest rates is “what the market is concerned about”, she added.
S&P 500 company earnings are due to unofficially kick off this week with reports from some big US banks. Analysts expect earnings to have fallen 6.4% in the second quarter from the year-ago period, IBES data from Refinitiv showed.
Among the day’s best performers, shares of Intel rose 2.8% and an index of semiconductors was up 2.1%.
Citigroup strategists on Monday downgraded US stocks to “neutral”, and said megacap growth is set for a pullback and US recession risks could still bite. – Reuters, AFP
Source: The Sun Daily
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