S&P 500 little changed as earnings and inflation loom
The S&P 500 traded just below the flatline as investors weighed a busy week of corporate earnings and inflation data. The Dow rose while the Nasdaq fell, with…
The S&P 500 little changed in Monday trading as investors looked ahead to a busy week of corporate earnings and inflation data, while conflicting statements over an announced energy ceasefire between Russia and Ukraine pushed oil prices higher.
The broad-market index traded just below the flatline. The Dow Jones Industrial Average rose 206 points, or 0.4%, while the Nasdaq Composite fell 0.3%, according to CNBC.
Micron Technology weighed on the Nasdaq, with its shares dropping 3% as investors assessed competition from China’s CXMT. The company reported progress on a new chip structure, CNBC reported. Salesforce helped lift the Dow, rising more than 1% after Bank of America gave the company a double upgrade.
Different forces pulled the market in opposite directions.
Oil advanced after President Donald Trump announced an “energy ceasefire” between Russia and Ukraine over the weekend. Ukrainian President Volodymyr Zelenskyy then said Moscow had already violated it. West Texas Intermediate futures rose 2% to around $93 per barrel, while Brent crude gained 2% to $106 per barrel, CNBC reported.
Trump also told reporters he was considering joining Saudi Arabia in its fight against Tehran-backed Houthis in Yemen, following another deadly attack on Riyadh’s international airport. His comments raised the prospect of further regional tensions, while higher oil prices added another factor for investors to weigh.
The market entered Monday after a winning week for the major averages. The Dow and S&P 500 each recorded their second positive week in three, while the Nasdaq posted a fourth consecutive week of gains. A rally in technology stocks had helped investors absorb higher oil prices and yields.
Investors are now looking to company results for signs that corporate performance can support stocks amid geopolitical uncertainty. FactSet’s John Butters expects S&P 500 earnings to grow 29.6% in the quarter. If realized, that would mark a fourth consecutive quarter of growth above 25%, which CNBC attributed to strength in the AI data center buildout.
Bank results and inflation data ahead
Major banks are expected to report this week as the earnings season gathers pace. Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo are all due to post results, according to CNBC.
Investors will also receive September consumer and producer price indexes, scheduled for Wednesday and Thursday, respectively. The readings could shape expectations for interest rates, although Tim Holland, chief investment officer at Orion, said earnings would be the central focus.
“It's going to be all on earnings,” Holland told CNBC. He said the market would likely see hotter-than-expected inflation readings as “not enough to derail” the Federal Reserve, which is largely expected to keep interest rates steady at its next meeting, according to the CME FedWatch tool.
“Something will upend this bull market at some point, but I think the most important thing going on right now is the AI capex buildout,” Holland said.
The day’s moves also varied across sectors. Nine of the 11 S&P 500 sectors were positive in midday trading. Energy and communication services each rose about 1.4%, while consumer staples gained 0.8%. Information technology fell around 0.9%, and consumer discretionary declined 0.5%.
The combination of upcoming earnings and inflation reports puts attention on whether corporate results can sustain the market’s recent gains as investors track oil prices and international tensions. The next market signals will come from the scheduled bank reports and inflation releases later this week.
Source: cnbc.com
