Market Daily

Market Daily

Monday Showed No Improves as Stock Futures Dipped

The stock market has been in a fragile state as of late. Monday evening showed no improvements as stock futures took another dip following a sleepy day of trading with investors waiting for crucial inflation data that will come out later this week.

It was found that futures tied to the Dow Jones Industrial Average fell by 0.1% along with S&P 500 futures and Nasdaq 100 futures, each taking a 0.1% dip.

During regular trading, the three stock market indexes managed to finish a little higher yesterday. Dow Jones Industrial Average finished the day with 16 points, which equals less than 0.1%, jumping more than 300 points earlier that day. Meanwhile, the tech-heavy Nasdaq Composite progressed to 0.4%, while the S&P 500 added 0.3%.

The indexes returned most of their gains from earlier that day as the 10-Year Treasury yield spiked to 3%, hitting its highest level in over a month.

There were no U.S. economic data releases on Monday, while the Federal Reserve had no earnings reports for major companies during the blackout period. Investors are still contemplating the recent bounce in stocks, wondering if the event is a bear market rally or if the market hit rock bottom from this year’s sell-off. 

Ed Yardeni, president at Yardeni Research, a sell-side consultancy that provides global investment and business strategy services, spoke on CNBC’s Closing Bell: Overtime and said:

“Since the beginning of the year, we’re seeing an altitude sickness when you look at the valuation multiple,” he shared. “To a large extent, clearly, with the benefit of hindsight, the market was overvalued. A lot of that was in the negative cap seat, big-cap names, related companies. I think we’ve seen a tremendous correction in that area. And now the question is whether the market can accept the kind of earnings expectations that analysts are delivering and whether those expectations will be correct.”

Regardless, investors are still tracking a lighter week in company earnings. For example, Cracker Barrel, J.M. Smucker, and United Natural Foods are all slated to report on Tuesday.

In economic data, last month’s consumer price index reading is the primary focus for investors, which is due on Friday. Comparing the readings to April’s numbers, some expect it could be a sign that inflation peaked.