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For the fifth time in six regular trading sessions, the Dow, Nasdaq and S&P 500 all reached the closing bell lower than they had been at the open. The same culprits are at fault: uncertainty due to the war in Ukraine, oil and other commodity prices on a global scale, and whether inflation can be tamed in the near-term here at home.
The Dow, which had been -466 points at its intra-day low, came in -113 points to -0.34%, while the S&P 500, now -12% from its all-time highs hit in the beginning of this year, was -0.43% on the day. The Nasdaq performed worst of all major indexes yet again today, -125 points or -0.95% — now -19% from its all-time highs in November — and the small-cap Russell 2000, with its domestic-led companies, outperformed the field, -0.23%.
The 10-year Treasury bond yield went back up above 2% for a time during regular trading today, and is +1.99% at this hour. By comparison, the 2-year yield is +1.70%. With the spread between the two now tighter than 30 basis points, we look to be closer to inverting this curve, which would be a strong indicator that an economic recession is on the horizon.
We saw the spread between the two yields dip below 1% only after the discovery of the Omicron variant in late November. Before that, you’d have to go back more than a year to see a sub-1% spread between 2s and 10s. The last time we saw an inversion, by the way, was for a very short time in late August 2019 — during the peak U.S.-China trade war — which did not result in a (non-Covid-related) recession.
Software giant Oracle (ORCL - Free Report) reported its first earnings miss since 2016 after Thursday’s close: $1.13 per share missed the Zacks consensus by four cents per share, on in-line revenues of $10.5 billion. Its growing Cloud business brought in $2.8 billion in the quarter, +24% year over year, but shares have fallen 6% in late trading on the news. Oracle shares are down more than -12% year to date but +13.7% from this time a year ago.
With this morning’s Consumer Price Index (CPI) already reported at a higher-than-expected +7.9% year over year, we are mostly exhausted of most economic reads up until the Fed’s next monetary policy meeting mid-next week. The PPI results for February come out on Tuesday, and the Fed’s decision about raising interest rates joins Retail Sales and Import Prices for last month on the docket. Otherwise, we are tethered to the war in Ukraine and its global fallout.
Image: Bigstock
Uncertainty Prevails as Indexes Turn South Again
For the fifth time in six regular trading sessions, the Dow, Nasdaq and S&P 500 all reached the closing bell lower than they had been at the open. The same culprits are at fault: uncertainty due to the war in Ukraine, oil and other commodity prices on a global scale, and whether inflation can be tamed in the near-term here at home.
The Dow, which had been -466 points at its intra-day low, came in -113 points to -0.34%, while the S&P 500, now -12% from its all-time highs hit in the beginning of this year, was -0.43% on the day. The Nasdaq performed worst of all major indexes yet again today, -125 points or -0.95% — now -19% from its all-time highs in November — and the small-cap Russell 2000, with its domestic-led companies, outperformed the field, -0.23%.
The 10-year Treasury bond yield went back up above 2% for a time during regular trading today, and is +1.99% at this hour. By comparison, the 2-year yield is +1.70%. With the spread between the two now tighter than 30 basis points, we look to be closer to inverting this curve, which would be a strong indicator that an economic recession is on the horizon.
We saw the spread between the two yields dip below 1% only after the discovery of the Omicron variant in late November. Before that, you’d have to go back more than a year to see a sub-1% spread between 2s and 10s. The last time we saw an inversion, by the way, was for a very short time in late August 2019 — during the peak U.S.-China trade war — which did not result in a (non-Covid-related) recession.
Software giant Oracle (ORCL - Free Report) reported its first earnings miss since 2016 after Thursday’s close: $1.13 per share missed the Zacks consensus by four cents per share, on in-line revenues of $10.5 billion. Its growing Cloud business brought in $2.8 billion in the quarter, +24% year over year, but shares have fallen 6% in late trading on the news. Oracle shares are down more than -12% year to date but +13.7% from this time a year ago.
With this morning’s Consumer Price Index (CPI) already reported at a higher-than-expected +7.9% year over year, we are mostly exhausted of most economic reads up until the Fed’s next monetary policy meeting mid-next week. The PPI results for February come out on Tuesday, and the Fed’s decision about raising interest rates joins Retail Sales and Import Prices for last month on the docket. Otherwise, we are tethered to the war in Ukraine and its global fallout.
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