US stocks finished neutral on Monday, after the S&P 500 index closed at a record high the day before, as investors braced for the year’s first crucial inflation update and the next round of earnings releases.
The S&P 500 (GSPC) finished slightly below the flat line following a record-breaking week that saw the benchmark end over 5,000 for the first time. The Dow Jones Industrial Average (DJI) increased by 0.3% to set a new high, while the tech-heavy Nasdaq (IXIC) dipped by 0.3%.
Nvidia (NVDA) shares gained 2% on Monday, setting a new high, before reversing gains. British chip manufacturer Arm (ARM) also set a new high, extending its recent run.
Stocks have risen as the market welcomes a slew of better-than-expected business reports, with large tech companies accounting for the lion’s share. The next round of quarterly reports is expected to be released soon, with John Deere (DE), Coca-Cola (KO), Airbnb (ABNB), and Kraft Heinz (KHC) among the highlights.
However, the surge will have a new test this week, as the January Consumer Price Index report is due on Tuesday. The CPI data will provide investors with their first look at how cool inflation will be in 2024, as well as an update on consumer spending, and will establish expectations for the timing and speed of Federal Reserve interest rate reduction this year.
On Monday, US equities finished neutral, although the Dow Jones Industrial Average (DJI) set a new high, up 0.3%, as investors anticipated the first significant inflation data of the year and the next wave of earnings releases.
The S&P 500 (^GSPC) closed the day marginally below the flatline, following a record-breaking week that saw the benchmark surpass 5,000 for the first time.
The tech-heavy Nasdaq (^IXIC) closed down 0.3%.
Nvidia (NVDA) shares gained 2% on Monday, setting a new high, before reversing gains. British chip manufacturer Arm (ARM) also set a new high, extending its recent run.
The market expects the Federal Reserve to drop interest rates this year, which will lead to lower mortgage rates, according to JPMorgan. Lower rates would increase sales in the existing housing market.
“While we continue to think that the rebound will be partly muted by the locked-in mortgage rate dynamic, the sheer potential magnitude of such a recovery suggests a strong acceleration in trends against arguably low consensus expectations,” he said.
He went on to say that “this churn could propel DIY as home sellers do small upgrades and new buyers buy a new set of basic items when they move in (e.g., garbage cans, flower pots, shades!).”
The stock is up more than 4% on Monday, ahead of its quarterly results, which will be released on Tuesday.
“We saw a pickup in travel trends (with healthy ADRs), since Airbnb guided in early November, and AirDNA’s estimates suggest some upside in 4Q,” said BofA analysts in a note on Monday.
The firm’s analysts reaffirmed their Neutral recommendation for the stock.
Airbnb’s stock price has increased by around 15% this year.
One thing is clear ahead of another widely awaited inflation estimate on Tuesday: political players will focus on any increases in food prices.
According to Yahoo Finance’s Ben Werschkul, the White House has been particularly focused on grocery stores, with President Joe Biden and his staff recently debating everything from the pricing of chicken wings to the size of a bag of chips.
GM’s (GM) Chevrolet has finally provided further price information for its forthcoming Equinox electric car. According to Pras Subramanian, the business would target the lower end of the market, which currently has few products.
Chevrolet confirmed that dealer ordering will begin soon. Chevy claims the entry-level Equinox EV in 1LT FWD (front-wheel drive) configuration will start at $34,995 and be available in the autumn. However, destination costs cost an extra $1,395.
GM also anticipates the Equinox EV to have an EPA-estimated range of 319 miles (FWD).
Nvidia’s (NVDA) market capitalization has surpassed that of Amazon (AMZN) and Alphabet (GOOG), with shares of the chipmaker reaching fresh all-time highs on Monday.
The stock is up more than 50% year to date, hitting an intraday high of $746.11 a share.
Nvidia’s market capitalization surpassed Amazon’s on Monday, reaching $1.83 billion. The chipmaker is just slightly greater than Alphabet, which has a market capitalization of over $1.82 billion.