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U.S. stocks mixed, NYSE halts trading, earnings season, Fed rate hike expected.
The U.S. stock market experienced a mixed day on Tuesday, with the S&P 500 (^GSPC) and Dow Jones Industrial Average (^DJI) both down by around 0.5%, and the Nasdaq Composite (^IXIC) off by 0.4%. Dozens of stocks were briefly halted for trading at the New York Stock Exchange (NYSE) shortly after markets opened, though most resumed regular trading soon after. The cause of the malfunction was unknown.
General Electric’s (GE) stock fell 2% after reporting a fourth-quarter profit that was weighed down by its renewable energy business, while Johnson & Johnson (JNJ) shares rose 1.4% after the healthcare giant reported full-year guidance above expectations. 3M Company (MMM) shares tumbled 5.5% after the manufacturing conglomerate reported a lower profit over an inflation-related drop in demand for items including air purifiers and respirators. Microsoft Corporation (MSFT) is scheduled to report its results after the closing bell.
The U.S. dollar steadied after falling to the lowest in nine months, while oil futures inched higher. West Texas Intermediate (WTI) oil — the U.S. benchmark — traded near $82 per barrel. The fourth-quarter net profit margin for the S&P 500 so far is 11.4%, below the previous quarter’s net profit margin of 11.9% and below the year-ago net profit margin of 12.4%. Moreover, consensus earnings estimates for 2023 have steadily trended lower.
The highlight of the week will be Thursday’s reading of the Gross Domestic Product (GDP). However, investors remain focused on the Federal Reserve’s next rate announcement at the start of February, with officials expected to downshift to a smaller hike. The CME FedWatch Tool, which serves as a barometer for imminent Fed rate and U.S. monetary policy, shows markets were pricing in a 99.1% chance of a 25-basis point hike as of Tuesday morning.
Tuesday’s stock market performance was mixed, with the S&P 500 (^GSPC), Dow Jones Industrial Average (^DJI), and Nasdaq Composite (^IXIC) all down by around 0.5%, 0.5%, and 0.4%, respectively. Dozens of stocks were briefly halted for trading at the New York Stock Exchange (NYSE) shortly after markets opened, though most resumed regular trading soon after.
General Electric (GE) reported a fourth-quarter profit that was weighed down by its renewable energy business, while Johnson & Johnson (JNJ) reported full-year guidance above expectations. 3M Company (MMM) reported a lower profit over an inflation-related drop in demand, while Microsoft Corporation (MSFT) is scheduled to report its results after the closing bell.
The U.S. dollar steadied after falling to the lowest in nine months, while oil futures inched higher. The fourth-quarter net profit margin for the S&P 500 so far is 11.4%, below the previous quarter’s net profit margin of 11.9% and below the year-ago net profit margin of 12.4%. Investors remain focused on the Federal Reserve’s next rate announcement at the start of February, with markets expecting a 25-basis point hike.
Thursday’s reading of the Gross Domestic Product (GDP) will be the highlight of the week. The earnings season has been off to a milder start, with consensus earnings estimates for 2023 steadily trending lower. The CME FedWatch Tool indicates that markets are expecting a smaller hike in the Federal Reserve’s next rate announcement.
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