U.S. stocks were slightly higher Monday after a morning rally lost ground earlier in the session.
[Click here to read what’s moving markets on Tuesday, May 7]
The S&P 500 was up 0.3% after rising more than 1% at the start of trading, and the Dow Jones Industrial Average closed just above breakeven after paring a 300-point gain. The tech-heavy Nasdaq rose 0.4%. The swing lower in equities from session highs came as the 10-year U.S. Treasury benchmark topped 3%.
All three major indexes struggled to recover from a sell-off Friday that rounded out another down week on Wall Street. The declines followed a stronger-than-expected May jobs report showed hiring kept at a slower but still-robust tempo last month – a sign of continued strength in the labor market expected to keep policymakers on pace with interest rate-hiking plans.
“As Fed speakers consistently remind us that the path towards draining inflationary pressures from the economy is going to be ‘bumpy’ and ‘painful,’ the market agrees as it navigates between seeing the next recession around the corner to witnessing a still healthy economic backdrop,” LPL Financial Chief Equity Strategist Quincy Krosby said.
The Labor Department’s May jobs report Friday showed 390,000 were added to the U.S. economy in May, while unemployment held at a rate of 3.6%.
Later this week, investors will get the latest gauge on how quickly prices are rising across the U.S. when the Bureau of Labor Statistics releases its latest Consumer Price Index Friday.
The headline CPI index is expected to have climbed in May but stay flat from last month’s reading on a year-over-year basis. Economists forecast the broadest measure of CPI rose by 8.3% in May, on par with April’s advance. Over the month, CPI is expected to show an increase of 0.7%, up from 0.2% last month.
Fed officials enter a blackout period this week, which limits the extent to which staff and Federal Open Market Committee (FOMC) members can speak publicly or give interviews ahead of their next policy-setting meeting set for June 14-15.
In final comments before Fedspeak pauses for the week, several policymakers have given a nod in public remarks to multiple 50 basis point rate hikes ahead.
“Right now it’s very hard to see the case for a pause,” Vice Chair Lael Brainard told CNBC in an interview Thursday. “We’ve still got a lot of work to do to get inflation down to our 2% target.”
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4:00 p.m. ET: Stocks cap choppy session in the green after choppy trading
Here’s where the S&P 500, Dow, and Nasdaq ended another day of volatile trading:
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S&P 500 (^GSPC): +12.78 (+0.31%) to 4,121.32
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Dow (^DJI): +14.50 (+0.04%) to 32,914.20
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Nasdaq (^IXIC): +48.64 (+0.40%) to 12,061.37
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Crude (CL=F): -$0.66 (-0.56%) to $118.21 a barrel
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Gold (GC=F): -$5.60 (-0.30%) to $1,844.60 per ounce
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10-year Treasury (^TNX): +8.1 bps to yield 3.0380%
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1:54 p.m. ET: Apple’s ‘buy now, pay later’ reveal weighs on rival Affirm
Shares of ‘buy now, pay’ later company Affirm (AFRM) slid after Apple (AAPL) said it will offer a version of the lending feature that will allow users to split the cost of an Apple Pay purchase into four equal payments, free of interest or late fees.
Affirm, a leader in the industry, saw its stock fall 5.5% to $23.72 following the announcement from Apple. Shares were down 3% to roughly $24 as of 1:54 p.m. ET.
The new service marks an expansion of the Apple Wallet’s capabilities and a jump for Apple into the space of installment payments — a growingly competitive but controversial market.
Buy now, pay later programs allow shoppers to defer payments into interest-free monthly installment plans, though often with hefty late fees.
Apple enters the industry as it draws scrutiny from consumer protection advocates, including the Consumer Financial Protection Bureau (CFPB). In January, the watchdog requested information from Affirm and other BNPL providers Afterpay, Zip, PayPal and Klarna on concerns over how quickly consumers accumulate debt using the instruments, an absence of regulatory disclosures, and the lack of clarity around how user data is harvested.
Still, BNPL has become a nearly $100 billion industry, offering potential for attractive growth to Apple, which three years ago introduced its first credit card.
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1:35 p.m. ET: Stocks retreat from morning highs, 10-year Treasury pushes above 3%
Here were the main moves in markets as of 1:35 p.m. ET:
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S&P 500 (^GSPC): +16.45 (+0.40%) to 4,124.99
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Dow (^DJI): +40.71 (+0.12%) to 32,940.41
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Nasdaq (^IXIC): +47.48 (+0.40%) to 12,060.21
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Crude (CL=F): -$0.45 (-0.38%) to $118.42 a barrel
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Gold (GC=F): -$5.60 (-0.30%) to $1,844.60 per ounce
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10-year Treasury (^TNX): +7.2 bps to yield 3.0290%
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11:15 a.m. ET: Amazon shares rally after trading kicks off on first stock split since 1999
Shares of Amazon (AMZN) rose more than 4% during its first day of trading since splitting its shares 20-for 1.
The e-commerce giant told investors in March that it would receive 19 additional shares for each one they owned on a split-adjusted basis. Since the announcement, shares of Amazon have fallen 12% (as of Friday’s close) along with a broader sell-off in equity markets.
The move does not alter the value of the stock or the company’s market capitalization at the time of the split but serves and an opportunity to make purchasing shares more accessible to retail investors, which would better position the company for candidacy to enter the Dow Jones Industrial Average.
Amazon’s latest stock split marks the fourth time it has carried out such a move since going public in 1997.
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9:30 a.m. ET: S&P 500, Dow, and Nasdaq rise after losing week
Here’s where the main indexes were trading at the start of the week:
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S&P 500 (^GSPC): +42.44 (+1.03%) to 4,150.98
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Dow (^DJI): +189.03 (+0.57%) to 33,088.73
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Nasdaq (^IXIC): +191.18 (+1.59%) to 12,203.92
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Crude (CL=F): S$ettlement Date to $N/A a barrel
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Gold (GC=F): +$4.40 (+0.24%) to $1,854.60 per ounce
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10-year Treasury (^TNX): +1.8 bps to yield 2.9750%
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7:16 a.m. ET: Stock futures rise as indexes aim to bounce back from weekly losses
Here were the main moves in futures trading ahead of Monday’s open:
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S&P 500 futures (ES=F): +44.00 (+1.07%) to 4,151.00
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Dow futures (YM=F): +2
62.00 (+0.80%) to 33,150.00 -
Nasdaq futures (NQ=F): +183.50 (+1.46%) to 12,734.50
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Crude (CL=F): +$0.57 (+0.48%) to $119.44
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Gold (GC=F): +$4.90 (+0.26%) to $1,855.10 per ounce
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10-year Treasury (^TNX): +4.4 bps to yield 2.9570%
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Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
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