Opening Comment — Wednesday, May 08, 2024
DJIA: 38,884.26, up 31.99
S&P 500: 5,187.70, up 6.96
NASDAQ: 16,332.56, down 16.69
Stocks lower ahead of wholesale inventories
Stock futures are lower on Wednesday, ahead of the latest earnings releases and the final release for March’s wholesale inventories. The Dow is falling 0.1%, while the S&P 500 is down 0.2%. The Nasdaq 100 is also decreasing 0.2% relative to fair value on the GLOBEX.
U.S. equities were little changed on Tuesday, as investors assessed the latest earnings releases and digested comments from Minneapolis Federal Reserve (Fed) President Neel Kashkari, who stated that he expects the Fed to maintain interest rates at their current level for an extended period until there is more clarity on the disinflationary situation. The Dow was up 0.1%, while the tech-heavy Nasdaq Composite fell 0.1%. The S&P 500 increased 0.1% with eight of 11 sectors finishing in positive territory. The Materials sector gained the most, rising 1.2%.
On the data front today, Mortgage Bankers Association (MBA) mortgage applications increased 2.6% for the week ending May 3 versus the prior week’s decrease of 2.3%. The final reading for March’s wholesale inventories is expected to decrease 0.4% month-over-month, unchanged from the prior reading. Department of Energy (DOE) crude oil inventories for the week ending May 3 are scheduled to be released today.
Across the pond, European stocks are mostly higher in mid-day trading with Germany’s industrial production decreasing less than projected in March. Italy’s retail sales stagnated on a monthly basis in March, compared to an anticipated increase.
Overnight in Asia, stocks were mixed with China’s foreign reserves surplus narrowing more than expectations in April. Investors digested earnings releases from some of the region’s major auto manufacturers.
In FOREX trading, the dollar is slightly higher as the Japanese yen weakened against the dollar, heightening concerns about further potential intervention from the Bank of Japan.
Over in the commodity pits, West Texas Intermediate (WTI) crude oil is 0.9% lower at $77.67/barrel, following data from the American Petroleum Institute indicating a rise in U.S. crude oil inventories, signaling sluggish demands.
In the metals complex, gold is little changed at $2323.80/ounce.