Stocks fluctuated as traders weighed earnings from banks and a news report saying Federal Reserve Bank of St. Louis President James Bullard favors continued rate hikes to fight inflation. Bonds rose.
(Bloomberg) — Stocks fluctuated as traders weighed earnings from banks and a news report saying Federal Reserve Bank of St. Louis President James Bullard favors continued rate hikes to fight inflation. Bonds rose.
The S&P 500 was little changed. Goldman Sachs Group Inc. dropped as traders failed to capitalize on the fixed-income bonanza the rest of Wall Street generated last quarter, contributing to firmwide revenue that trailed analysts’ estimates. Bank of America Corp. slipped even as profit beat expectations. Southwest Airlines Co. sank after halting flights nationwide as the carrier said it was dealing with “intermittent technology issues.”
“This is a boom/bust US cycle and we’re getting closer to the bust part,” wrote Deutsche Bank’s Jim Reid. “However, I doubt big banks will be at the epicenter of it as a lot has positively changed in their fundamentals. So a retreat from peak financial pessimism makes sense.”
Investor allocation to equities relative to bonds has dropped to its lowest level since the global financial crisis as worries about a recession take hold, according to BofA’s global fund manager survey. BlackRock Inc. said it expects institutional investors to increase allocations to private equity and private credit funds this year even amid recession fears and rising interest rates.
Bitcoin’s 2023 rebound has resumed after stalling around the closely watched $30,000 level, despite the latest US crypto crackdown and a more sober assessment of the outlook for monetary policy.
Key events this week:
- Eurozone CPI, Wednesday
- Fed releases Beige Book, Wednesday
- Fed’s John Williams gives a speech, Wednesday
- Fed’s Austan Goolsbee is interviewed on NPR, Wednesday
- China loan prime rates, Thursday
- Eurozone consumer confidence, Thursday
- US initial jobless claims, existing home sales, index of leading economic indicators, Thursday
- ECB issues report on March policy meeting, Thursday
- Fed’s Christopher Waller speaks at cryptocurrency-focused event, Thursday
- Fed’s Patrick Harker speaks on “monetary policy and housing”, Thursday
- Fed’s Loretta Mester discusses the economic and policy outlook, Thursday
- Fed’s Raphael Bostic discusses regional and national economic conditions, Thursday
- Fed’s Michelle Bowman and Lorie Logan speak at event, Thursday
- PMIs for Eurozone, Friday
- Japan CPI, Friday
- Fed’s Lisa Cook discusses economic research at an event, Friday
Some of the main moves in the market:
Stocks
- The S&P 500 fell 0.1% as of 11 a.m. New York time
- The Nasdaq 100 was little changed
- The Dow Jones Industrial Average fell 0.4%
- The Stoxx Europe 600 rose 0.4%
- The MSCI World index rose 0.1%
Currencies
- The Bloomberg Dollar Spot Index fell 0.2%
- The euro rose 0.3% to $1.0962
- The British pound rose 0.4% to $1.2428
- The Japanese yen rose 0.4% to 133.98 per dollar
Cryptocurrencies
- Bitcoin rose 2.8% to $30,274.61
- Ether rose 1.1% to $2,099.81
Bonds
- The yield on 10-year Treasuries declined five basis points to 3.55%
- Germany’s 10-year yield declined one basis point to 2.46%
- Britain’s 10-year yield advanced three basis points to 3.73%
Commodities
- West Texas Intermediate crude was little changed
- Gold futures rose 0.7% to $2,021.50 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Cristin Flanagan, Vildana Hajric and Carly Wanna.
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