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In
a week lacking big catalysts, market momentum has stalled
somewhat as investors look for fresh clues on the monetary
policy outlook, after softer-than-expected payrolls data last
week fueled bets of one or two rate cuts this year.
The S&P 500 ended flat on Wednesday after four sessions of gains
and the Nasdaq slipped for a second day. The Dow Jones
Industrial Average, however, stretched its winning streak to a
sixth straight session and closed above 39,000 points for the
first time in five weeks.
Money market traders are pricing in U.S. rate cuts of 43 basis
points (bps) by the end of 2024, according to LSEG's rate
probabilities app. Before the jobs data, they were pricing in
just one rate cut due to signs of a resilient economy and sticky
inflation.
Market focus will shift to weekly jobless claims data and
remarks from San Francisco Fed President Mary Daly during the
day.
Boston Fed President Susan Collins on Wednesday expressed
confidence that the current setting of monetary policy will slow
the economy in a way she believes will be necessary to get
inflation back to the Fed's 2% target.
The yield on 10-year Treasury notes, the benchmark for global
borrowing costs, edged up for a second day after the auction of
10-year notes. [US/]
That in turn piled pressure on megacap stocks such as Apple and
Microsoft in premarket trading.
By 5:19 a.m. ET, S&P 500 e-minis dipped 17.5 points, or 0.34%.
Nasdaq 100 e-minis slipped 79.75 points, or 0.44%, and Dow
e-minis dropped 105 points, or 0.27%.
Arm Holdings tumbled 8.7% after the chip designer forecast
full-year revenue below expectations even as March-quarter
results beat estimates.
Rival Nvidia slipped 0.7%.
Tesla dipped 1.1% after Bloomberg News reported the electric
vehicle maker's job cuts were escalating in China.
Robinhood Markets gained 5.4% after the online brokerage beat
estimates for first-quarter profit, thanks to robust crypto
trading volumes and rate hikes that boosted its net interest
revenue.
Airbnb slid nearly 8% after the vacation rental company forecast
second-quarter revenue below market expectations.
(Reporting by Sruthi Shankar in Bengaluru; Editing by Devika
Syamnath)
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