US stocks hack ahead of Monday’s session; Bank earnings in the first quarter on deck

U.S. stocks traded early Monday morning between negative and positive territory as the first-quarter earnings season kicks off unofficially this week with several of the major banks reporting.

Ticker Security Last Change Change %
I: DJI DOW JONES On average 34721.12 +137.55 +0.40%
SP500 S&P 500 4488.28 -11.93 -0.27%
I: COMP NASDAQ COMPOSITE INDEX 13710.996005 -186.30 -1.34%

Reports this week are JPMorgan Chase and BlackRock on Wednesday, with Citigroup, Wells Fargo, Morgan Stanley, Goldman Sachs and a few others out on Thursday.

The Wall Street benchmark S&P 500 lost 0.3% on Friday after Fed officials in notes from their last meeting indicated that they were considering raising its benchmark rate by twice the normal amount at upcoming meetings. They also indicated that they are likely to shrink the Fed’s bond portfolio, which could also push up commercial lending rates.

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Investors see “growing evidence that the Federal Reserve will take a more committed approach” to fighting inflation, said Stephen Innes of SPI Asset Management in a report.

On Friday, the S&P 500 fell to 4,488.28, while the Dow Jones Industrial Average rose 0.4% to 34,721.12. Technical weakness of the stock pulled down the Nasdaq Composition by 1.3% to 13,711.00.

U.S. stocks were lower early Monday morning as the first-quarter earnings season kicks off unofficially this week with several of the major banks reporting. (Courtney Crow / New York Stock Exchange via AP / Associated Press)

Investors have been uneasy since Fed officials began saying they would try to cool inflation, which is at four decades high, by rolling back record low interest rates and other stimulus that raises stock prices.

Higher interest rates usually lower economic activity and make safer assets such as bonds more attractive, while making equities look more risky and more expensive.

Some fear that the Fed, after being accused of reacting too late to rising inflation, could push the brakes too hard and tip the world’s largest economy into recession. Economists at Deutsche Bank last week predicted a US recession late next year.

Meanwhile, Asian stock markets followed Wall Street lower on Monday after the Federal Reserve indicated it could raise interest rates more aggressively to cool US inflation.

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Shanghai, Tokyo, Hong Kong and South Korea all fell. Oil fell more than $ 2 per barrel. barrel due to concerns that global economic growth could weaken.

Investors are worried about a possible downward pressure on economic activity from higher interest rates, Russia’s war on Ukraine and China’s efforts to curb coronavirus outbreaks.

Shanghai Composite Index lost 1.7% to 3,195.07 after inflation accelerated to 1.5% over a year ago in March from the previous month’s 0.9% due to upward pressure on global prices due to uncertainty about Russia war against Ukraine.

Inflation, which may accelerate further this month, “may limit room to lower interest rates” to support Chinese economic growth, Nomura analysts said in a report.

The Nikkei 225 in Tokyo fell 0.8% to 26,764.91, and Hong Kong’s Hang Seng retreated 2.5% to 21,336.37.

The S&P ASX 200 in Sydney rose less than 0.1% to 7,480.20.

India’s Sensex opened down 0.6% to 59,090.46. New Zealand and Singapore fell as Indonesia advanced.

Oil prices have fallen back on expectations of weaker demand after peaking above $ 130 per barrel last month due to fears of supply disruptions from Russia, the world’s No. 2 exporter. (Courtney Crow / New York Stock Exchange via AP)

Oil prices have fallen back on expectations of weaker demand after peaking above $ 130 per barrel last month due to fears of supply disruptions from Russia, the world’s No. 2 exporter.

In China, automakers and other companies are reducing production due to supply disruptions after authorities imposed strict anti-disease controls to stop coronavirus outbreaks in Shanghai and other cities.

ACM Research, a semiconductor equipment supplier operating in Shanghai, fell 6.1% on Friday after saying the restrictions would cause a significant hit to the company’s revenue.

In the energy markets, benchmark US crude fell $ 2.33 to $ 95.93 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $ 2.23 to $ 98.26 on Friday. Brent crude, used as a price base for international oils, retreated $ 2.33 to $ 100.45 per barrel in London. It rose by $ 2.20 the previous session to $ 102.78 per session. barrel.

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The dollar rose to 124.94 yen from Friday’s 124.37 yen. The euro remained stable at $ 1.0885.

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