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Business Times
10 hours ago
- Business
- Business Times
US: S&P 500, Nasdaq hit record closing highs amid trade negotiations, rate cut bets
[NEW YORK] Wall Street extended its rally on Friday (Jun 27), sending S&P 500 and Nasdaq to all-time closing highs as trade deal hopes fuelled investor risk appetite and economic data helped solidify expectations for rate cuts from the US Federal Reserve. Stocks pared gains after US President Donald Trump terminated trade negotiations with Canada in response to its digital tax on technology companies. Even so, all three major US stock indices posted weekly gains. Upon reaching its record closing high, the tech-heavy Nasdaq confirmed it entered a bull market when it touched its post 'Liberation Day' trough on Apr 8. The blue-chip Dow remained 2.7 per cent below its record closing high reached on Dec 4. 'This market's been pretty resilient,' said Chuck Carlson, chief executive at Horizon Investment Services in Hammond, Indiana. 'Investors are riding momentum and looking for breakouts.' 'They don't want to get caught on the wrong side of this thing,' Carlson added. 'Many investors already have missed out. And now you have the S&P flirting with an all-time high.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The Personal Consumption Expenditures report from the Commerce Department showed consumer income and spending unexpectedly contracted in May. And while tariffs have yet to affect price growth, inflation continues to hover above the Fed's 2 per cent annual inflation target. A separate report from the University of Michigan confirmed consumer sentiment improved this month, but remains well below December's post-election bounce. Financial markets have priced in a 76 per cent likelihood that the Fed will implement its first rate cut of the year in September, with a smaller, 19 per cent probability of a rate cut coming as soon as July, according to CME's FedWatch tool. Washington and Beijing reached an agreement to expedite rare-earth shipments from China to the US, a White House official said, well ahead of the Jul 9 expiration of the 90-day postponement of Trump's 'reciprocal' tariffs. Additionally, US Treasury Secretary Scott Bessent said the administration's trade deals with 18 of the main US trading partners could be done by the Sep 1 Labor Day holiday. The Dow Jones Industrial Average rose 432.43 points or 1 per cent to 43,819.27, the S&P 500 gained 32.05 points or 0.5 per cent to 6,173.07 and the Nasdaq Composite gained 105.55 points or 0.5 per cent to 20,273.46. Among the 11 major sectors of the S&P 500, consumer discretionary enjoyed the biggest percentage gain, while energy shares were the laggards. Chipmaker Micron's MU.O upbeat forecast revived investor confidence in artificial intelligence-related stocks, while Nvidia NVDA.O rose 1.8 per cent, edging closer to US$4 trillion market capitalisation after reclaiming its position as the world's most valuable company. Nike's shares NKE.N jumped 15.2 per cent after forecasting a smaller-than-expected drop in first-quarter revenue. Advancing issues outnumbered decliners by a 1.29-to-1 ratio on the NYSE. There were 347 new highs and 55 new lows on the NYSE. On the Nasdaq, 2,111 stocks rose and 2,342 fell as declining issues outnumbered advancers by a 1.11-to-1 ratio. The S&P 500 posted 35 new 52-week highs and six new lows while the Nasdaq Composite recorded 101 new highs and 68 new lows. Volume on US exchanges was 22.07 billion shares, compared with the 18.27 billion average for the full session over the last 20 trading days. REUTERS
Yahoo
18-06-2025
- Business
- Yahoo
Investors see quick stock market drop if US joins Israel-Iran conflict
By Noel Randewich (Reuters) -Financial markets may be in for a "knee-jerk" selloff if the U.S. military attacks Iran, with economists warning that a dramatic rise in oil prices could damage a global economy already strained by President Donald Trump's tariffs. Oil prices fell nearly 2% on Wednesday as investors weighed the chance of supply disruptions from the Israel-Iran conflict and potential direct U.S. involvement. The price of crude remains up almost 9% since Israel launched attacks against Iran last Friday in a bid to cripple its ability to produce nuclear weapons. With major U.S. stock indexes trading near record highs despite uncertainty about Trump's trade policy, some investors worry that equities may be particularly vulnerable to sources of additional global uncertainty. Chuck Carlson, chief executive officer at Horizon Investment Services, said U.S. stocks might initially sell off should Trump order the U.S. military to become more heavily involved in the Israel-Iran conflict, but that a faster escalation might also bring the situation to an end sooner. "I could see the initial knee-jerk would be, 'this is bad'," Carlson said. "I think it will bring things to a head quicker." Wednesday's dip in crude, along with a modest 0.3% increase in the S&P 500, came after Trump declined to answer reporters' questions about whether the U.S. was planning to strike Iran but said Iran had proposed to come for talks at the White House. Adding to uncertainty, Iranian Supreme Leader Ayatollah Ali Khamenei rejected Trump's demand for unconditional surrender. U.S. Treasury yields fell as concerns over the war in Iran boosted safe haven demand for the debt. The U.S. military is also bolstering its presence in the region, Reuters reported, further stirring speculation about U.S. intervention that investors fear could widen the conflict in an area with critical energy resources, supply chains and infrastructure. With investors viewing the dollar as a safe haven, it has gained around 1% against both the Japanese yen and Swiss franc since last Thursday. On Wednesday, the U.S. currency took a breather, edging fractionally lower against the yen and the franc. 'I don't think personally that we are going to join this war. I think Trump is going to do everything possible to avoid it. But if it can't be avoided, then initially that's going to be negative for the markets,' said Peter Cardillo, Chief Market Economist at Spartan Capital Securities in New York. "Gold would shoot up. Yields would probably come down lower and the dollar would probably rally." Barclays warned that crude prices could rise to $85 per barrel if Iranian exports are reduced by half, and that prices could rise about $100 in the "worst case" scenario of a wider conflagration. Brent crude was last at about $76. Citigroup economists warned in a note on Wednesday that materially higher oil prices "would be a negative supply shock for the global economy, lowering growth and boosting inflation—creating further challenges for central banks that are already trying to navigate the risks from tariffs." Trump taking a "heavier hand" would not be a surprise to the market, mitigating any negative asset price reaction, Carlson said, while adding that he was still not convinced that the U.S. would take a heavier role. Trades on the Polymarket betting website point to a 63% expectation of "U.S. military action against Iran before July", down from as much as an 82% likelihood on Tuesday, but still above a 35% chance before the conflict began last Friday. The S&P 500 energy sector index has rallied over 2% in the past four sessions, lifted by a 3.8% gain in Exxon Mobil and 5% rally in Valero Energy. That compares to a 0.7% drop in the S&P 500 over the same period, reflecting investor concerns about the impact of higher oil prices on the economy, and about growing global uncertainty generated by the conflict. Turmoil in the Middle East comes as investors are already fretting about the effect of Trump's tariffs on the global economy. The World Bank last week slashed its global growth forecast for 2025 by four-tenths of a percentage point to 2.3%, saying that higher tariffs and heightened uncertainty posed a "significant headwind" for nearly all economies. Defense stocks, already lifted by Russia's conflict with Ukraine, have made modest gains since Israel launched its attacks. The S&P 500 Aerospace and Defense index hit record highs early last week in the culmination of a rebound of over 30% from losses in the wake of Trump's April 2 "Liberation Day" tariff announcements. Even after the latest geopolitical uncertainty, the S&P 500 remains just 2% below its February record high close. "Investors want to be able to look past this, and until we see reasons to believe that this is going to be a much larger regional conflict with the U.S. perhaps getting involved and a high chance of escalating, you're going to see the market want to shrug this off as much as it can,' Osman Ali, global co-head of Quantitative Investment Strategies, said at an investor conference on Wednesday.
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Business Standard
04-06-2025
- Business
- Business Standard
Wall Street rises, dollar rebounds amid tariff talks, economic data
US stocks advanced and the dollar rebounded on Tuesday as investors weighed progress in ongoing US tariff talks and lowered economic expectations ahead of Friday's crucial US employment report. All three major US stock indexes ended the session with gains, with chips putting the tech-heavy Nasdaq out front following White House assurances that US President Donald Trump will likely meet Chinese President Xi Jinping this week to address trade disputes between the world's two largest economies. Gold backed down from a nearly four-week high as the greenback strengthened. "It's hard to know what's really driving things today," said Chuck Carlson, CEO of Horizon Investment Services in Hammond, Indiana. "There seems to be a little bit more comfort that the economy is not going into recession, and there might be a bit of front-running here in the sense we have a jobs report that's going to be coming out and investors want to get on the right side of that before it's released." While the Trump administration pressed US trading partners to provide their best offers by Wednesday, the protracted negotiations and moving deadlines have prompted economists to dial back economic expectations due to fallout from Trump's trade war. The Organization for Economic Cooperation and Development (OECD) said the global economy is on course for a more drastic slowdown than it had expected only a few months ago. It cited Trump's trade war, and warned of even weaker growth as protectionism increases, fueling inflation and disrupting supply chains. The United Nations' International Labor Organization (ILO) downgraded its global employment forecast, citing worsened economic conditions from trade tensions. "Maybe that's helping US markets," Carlson added, noting that the weaker global economic growth projections could be encouraging investors to move money back into US The US Labor Department reported that the number of unfilled US jobs unexpectedly rose in April, while new orders for factory-made goods posted a steeper drop than analysts had anticipated. Investors are now focused on the May employment report due on Friday. Economists polled by Reuters expect the US economy added 130,000 jobs last month, with the unemployment rate standing pat at 4.2 per cent. The Dow Jones Industrial Average rose 214.16 points, or 0.51 per cent, to 42,519.64, the S&P 500 rose 34.43 points, or 0.58 per cent, to 5,970.37 and the Nasdaq Composite rose 156.34 points, or 0.81 per cent, to 19,398.96. European stocks ended nominally higher as investors weighed trade anxieties against a report that euro zone inflation has eased below the European Central Bank's target, paving the way for further policy easing. MSCI's gauge of stocks across the globe rose 2.64 points, or 0.30 per cent, to 885.52. The pan-European STOXX 600 index rose 0.09 per cent, while Europe's broad FTSEurofirst 300 index rose 3.80 points, or 0.17 per cent Emerging market stocks rose 3.67 points, or 0.32 per cent, to 1,157.44. MSCI's broadest index of Asia-Pacific shares outside Japan closed higher by 0.37 per cent, to 609.73, while Japan's Nikkei fell 23.86 points, or 0.06 per cent, to 37,446.81. The dollar bounced back from a six-week low, even as concerns persisted over potential economic damage in the wake of Trump's trade war. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.71 per cent to 99.28, with the euro down 0.62 per cent at $1.137. Against the Japanese yen, the dollar strengthened 0.93 per cent to 144.02. Longer-dated US Treasury yields dipped as investors awaited new developments in trade talks, but were off initial lows in the wake of economic data. The yield on benchmark US 10-year notes fell 1 basis point to 4.452 per cent, from 4.462 per cent late on Monday. The 30-year bond yield fell 1.8 basis points to 4.9769 per cent from 4.995 per cent late on Monday. The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 0.8 basis points to 3.953 per cent, from 3.945 per cent late on Monday. Crude prices extended gains, supported by geopolitical concerns as the war in Ukraine intensified and Iran appeared poised to reject a US nuclear deal proposal. US crude rose 1.42 per cent to settle at $63.41 per barrel, while Brent settled at $65.63 per barrel, up 1.55 per cent on the day. Gold prices retreated from a nearly four-week high amid profit-taking and in opposition to the strengthening dollar. Spot gold fell 0.78 per cent to $3,352.87 an ounce. US gold futures fell 0.59 per cent to $3,350.60 an ounce.
Zawya
26-05-2025
- Business
- Zawya
Wall St Week Ahead: Nvidia earnings in focus as rising US yields, debt rattle markets
NEW YORK: An earnings report from semiconductor giant and artificial intelligence bellwether Nvidia takes center stage for Wall Street in the coming week, as stocks hit a speed bump of worries over federal deficits driving up Treasury yields. U.S. equities pulled back this week after a torrid rally, as investors turned their attention to tax and spending legislation poised to swell the U.S. government's $36 trillion in debt. Long-dated U.S. Treasury yields rose amid the fiscal worries, with the 30-year yield topping 5% and hitting its highest level since late 2023. Stocks were dealt another blow on Friday when U.S. President Donald Trump targeted the European Union and Apple in threats to ratchet up his trade war. Focus will shift to Wednesday's quarterly results from Nvidia, one of the world's largest companies by market value whose stock is a major influence on benchmark equity indexes. "All eyes are going to be on Nvidia's report," said Chuck Carlson, CEO of Horizon Investment Services. "The whole AI theme has been a major driver of the market and Nvidia is at the epicenter of that theme." Nvidia will be the last of the "Magnificent Seven" megacap tech and growth companies to report results for this period. Their stocks have been mixed in 2025 after leading the market higher as a group in the last two years. Nvidia shares are down 2% this year after soaring over 1,000% from late 2022 through the end of 2024 as its AI chip business spurred massive increases in revenue and profits. Nvidia's first-quarter earnings likely jumped about 45% on revenue of $43.2 billion, analysts estimated in an LSEG poll. After big tech companies earlier in the quarter signaled robust AI-related spending, Nvidia can deliver a strong message about AI and how companies' spending plans are faring, said Art Hogan, chief market strategist at B Riley Wealth. "Nvidia can reinvigorate the enthusiasm for that theme." Nvidia, popular among smaller retail shareholders, is an investor sentiment indicator, said Wasif Latif, chief investment officer at Sarmaya Partners. "Given its sheer size and attention that it is commanding, there are going to be a lot of people looking for what happens with the stock," Latif said. U.S.-China relations could also be in focus with Nvidia's report. The company said last month it would take $5.5 billion in charges after the U.S. government limited exports of its H20 artificial intelligence chip to China. Trade developments have whipsawed the stock market this year, especially after Trump's April 2 announcement of sweeping tariffs on imports globally set off extreme asset price volatility. Since then, Trump's easing of tariffs, especially a U.S.-China truce, has helped equities rebound. The benchmark S&P 500 index ended on Friday down 1.3% for 2025, and down 5.6% from its February record high. Stocks slipped on Friday after Trump pushed for a 50% tariff on European Union goods starting June 1 and threatened to impose a 25% tariff on Apple for any iPhones sold, but not made, in the United States. Trump's fiscal plans consumed investor attention for much of the week, especially after Moody's downgraded the U.S. sovereign credit rating due to concerns about the nation's growing debt pile. The U.S. House of Representatives, controlled by Trump's Republican party, on Thursday narrowly passed a tax and spending bill that would enact much of his agenda while adding an estimated $3.8 trillion to the debt over the next decade. The bill is heading to the U.S. Senate for its review. Long-dated government bond yields have been rising globally amid a selloff, although they pulled back toward the end of the week. In the U.S., benchmark 10-year Treasury yields this week hit their highest since February. Bond prices move opposite to yields. Higher yields can diminish the appeal of stocks as they represent higher borrowing costs for companies and consumers, while making fixed income assets relatively more attractive. "The biggest concern from an investment standpoint is that higher rates represent more competition for equities," said Horizon's Carlson. "If rates continue to move higher, that is going to put increasing amounts of pressure on where investors are putting their money." (Reporting by Lewis Krauskopf; Editing by Richard Chang)
Time of India
25-05-2025
- Business
- Time of India
Nvidia earnings US Market: Wall Street on edge this week: Will Nvidia's earnings revive markets or fuel chaos amid soaring U.S. Debt?
Nvidia Earnings in Spotlight ADVERTISEMENT Market Pressure from Debt, Yields Trump's Trade Posture Adds to Volatility ADVERTISEMENT Outlook and Investor Sentiment ADVERTISEMENT FAQs Why is Nvidia's earnings report significant this week? What are analysts expecting from Nvidia's earnings? The upcoming week on Wall Street is poised to revolve around a pivotal earnings announcement from Nvidia, the global semiconductor leader, even as investors remain wary of ballooning U.S. debt and surging Treasury yields that have rattled broader market focus will squarely be on Nvidia, with its quarterly earnings scheduled for release on Wednesday. As the last of the so-called 'Magnificent Seven' technology giants to report this cycle, the chipmaker's performance is being closely watched due to its outsized role in the artificial intelligence (AI) boom."All eyes are going to be on Nvidia's report," said Chuck Carlson, Chief Executive Officer at Horizon Investment Services, as quoted in a report by Reuters."The whole AI theme has been a major driver of the market and Nvidia is at the epicenter of that theme."Analyst projections compiled by LSEG estimate Nvidia's first-quarter earnings to have surged by around 45%, with revenue expected to touch $43.2 company's financial health is being seen not only as a reflection of AI momentum but also as a bellwether for broader investor tech earnings draw investor attention, economic undercurrents linked to government spending and debt are beginning to take center stage. The U.S. share market retreated this week amid heightened concern over fiscal policy. The yield on the 30-year Treasury note breached the 5% mark, its highest level since 2023, signaling investor anxiety over federal U.S. House of Representatives, now under Republican control, recently passed a major tax and spending bill in line with President Donald Trump's economic agenda. The proposed legislation could expand federal debt by approximately $3.8 trillion over the next decade. This development contributed to a downgrade of the U.S. sovereign credit rating by Moody's."From an investment perspective, higher interest rates now represent more competition for equities," noted Carlson. "If this trend persists, we could see more pressure on stock valuations."Markets were further unsettled on Friday after U.S. President Donald Trump threatened to levy a 50% tariff on European Union imports beginning June 1. He also warned of a potential 25% tariff on Apple if iPhones sold in the U.S. are not manufactured domestically. These remarks sparked renewed concerns over trade tensions and their impact on global supply could be particularly affected, with the company already having taken a $5.5 billion charge in anticipation of lost revenue following Washington's ban on exporting its H20 AI chip to a strong rally earlier in the year, the S&P 500 is now down over 5.6% from its record high in February and 1.3% lower for 2025 overall. Still, Nvidia's earnings report is widely viewed as a potential catalyst.'If Nvidia delivers strong numbers and guidance, it could reignite optimism around AI investments,' said Art Hogan, Chief Market Strategist at B Riley such, this week's developments are set to offer critical signals for the direction of the US share market, with Nvidia's results at the core of investor is set to release its quarterly earnings on Wednesday, and as the last of the 'Magnificent Seven' tech giants to report, its results are seen as a key indicator of both AI sector momentum and broader market estimate that Nvidia's earnings have jumped by about 45%, with revenue expected to reach around $43.2 billion, driven largely by its central role in the artificial intelligence boom.
