The S&P 500 threatens to take a breather after conquering annual maximums

Futures linked to the DOW JONES fell 0.07% to 33,595 points, while those of the S&P 500 rose 0.02% to 4,290 points. NASDAQ 100 futures fell 0.03% to 14,581 points.

Stocks rallied during the session on Tuesday. The broad index added 0.24% to finish at its highest level since August 2022, with seven major sectors ending the session with gains. The financial sector added 1.3%, boosted by regional bank stocks and big names like Goldman Sachs and Morgan Stanley.

Meanwhile, the Nasdaq Composite rose 0.36% and closed at its highest level since 2023. The Dow Jones index rose 10.42 points, or 0.03%, pressured by healthcare stocks Merck and UnitedHealth.

Tuesday’s uptrend trailed last week’s rally. However, continued modest gains instead of sharp retracements after a major rally could signal more good news to come, believes Adam Sarhan, CEO of 50 Park Investments. “The fact that it refuses to go down seems extremely bullish to me,” he says. “Normally after a big rally the market pulls back, and when the market doesn’t pull back and goes sideways, it’s very bullish to me.”

On the corporate front, Dave & Buster’s shares rose nearly 4% pre-open after the entertainment company reported first-quarter results last night that beat Wall Street expectations. The company posted earnings of $1.45 per share, 21 cents higher than the $1.24 analysts expected. Dave & Buster’s posted revenue of $597 million in the period, slightly below the $602 million expected.

Also strong rises for the shares of Stitch Fix after presenting some accounts that show smaller losses than what the market had feared. The small online clothing and styling company, with a market capitalization of about $414 million, posted a loss of 19 cents per share on revenue of $395 million. Analysts had expected a loss of 30 cents per share on total revenue of $389 million.

Stitch Fix said it will explore exiting the UK market in fiscal 2024.

In the day of this Wednesday the accounts of Campbell Soup and GameStop will also be known.

With a light macroeconomic agenda, which barely includes April’s trade balance and weekly mortgage figures, investors’ attention is already turning to next week’s Federal Reserve meeting.

Market consensus expects the Fed leaves interest rates unchanged at next week’s meeting, although increases could resume in July with a new 25-point rise. However, much will depend on the inflation readings and the employment figures that are released in the coming days.

The Fed’s pause could give more gas to technology stocks, which are being the big stars this year thanks in large part to the boom in artificial intelligence. for now, Citigroup analysts see more potential: “We remain positive on growth for June as we see more tailwinds than headwinds manifesting for this style over the next month,” a team including Chris Montagu wrote in a note. However, he cautioned that the gains in the stock indexes were driven by fewer shares in May, which posed a risk.

In fixed income, US Treasury yields fell slightly on Wednesday as investors scrutinized the outlook for the economy and central bank interest rates and looked to economic data for clues. The ten-year bond yield falls by two basis points to 3.677%. The two-year paper yield drops another two points to 4.504%.

In the commodity markets, oil prices resume gains, with Saudi Arabia’s promises of cuts weighing more on investor sentiment than the doubts left by the latest macroeconomic benchmarks from China, the world’s main importer. US West Texas crude futures rose 0.79% to $72.46 a barrel, while European benchmark Brent crude rose 0.76% to $77.

The euro rises 0.16% against the dollar until establishing an exchange rate of 1.0713 dollars for each community currency.


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