Highlights
Stocks ended mixed but mostly weaker in quiet trading with another rally in Nvidia helping the Nasdaq outperform and set a new high. The Dow Jones industrial average declined 0.6 percent, the S&P 500 was flat, and the Nasdaq rose 0.6 percent. Bond yields and oil prices rose while the dollar fell.
Most stocks outside the tech sector declined with rising bond yields a negative. US Treasuries sold off after a surprising jump in consumer confidence and later on tepid demand in the day's Treasury 2-year and 5-year note auctions. Another round of hawkish comments from Minneapolis Fed President Neel Kashkari was another factor weighing on equities and the bond market. Kashkari said he would need to see many more months of improving inflation data before he would consider rate cuts, and that rate hikes remain on the table.
On the positive side, Nvidia rallied above $1,000 to close at a fresh record after xAI, the Elon Musk artificial intelligence venture, announced a big capital raise. That spurred gains in other chipmakers. Other outperformers included energy, with oil up big, plus industrial metals, apparel retailers, and restaurant chains. On the downside, worst performers included homebuilders, airlines, autos, pharma, software, banks, railroads, food & beverage, health care, and health & personal care.
Investors are awaiting the inflation reading in Friday's personal income and spending report. Expectations for PCE prices center on a month-to-month rise of 0.3 percent and a 0.2 percent rise for core PCE prices for April. Fed officials say they are focused on the PCE inflation figures as they assess progress toward their 2 percent inflation target.
Most stocks outside the tech sector declined with rising bond yields a negative. US Treasuries sold off after a surprising jump in consumer confidence and later on tepid demand in the day's Treasury 2-year and 5-year note auctions. Another round of hawkish comments from Minneapolis Fed President Neel Kashkari was another factor weighing on equities and the bond market. Kashkari said he would need to see many more months of improving inflation data before he would consider rate cuts, and that rate hikes remain on the table.
On the positive side, Nvidia rallied above $1,000 to close at a fresh record after xAI, the Elon Musk artificial intelligence venture, announced a big capital raise. That spurred gains in other chipmakers. Other outperformers included energy, with oil up big, plus industrial metals, apparel retailers, and restaurant chains. On the downside, worst performers included homebuilders, airlines, autos, pharma, software, banks, railroads, food & beverage, health care, and health & personal care.
Investors are awaiting the inflation reading in Friday's personal income and spending report. Expectations for PCE prices center on a month-to-month rise of 0.3 percent and a 0.2 percent rise for core PCE prices for April. Fed officials say they are focused on the PCE inflation figures as they assess progress toward their 2 percent inflation target.
Definition
Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.
Description
Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.
