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Wall Street closed lower on Monday, following the World Bank’s reduced growth outlook. Investors adopted a wait-and-watch attitude due to a barrage of earnings reports expected this week. The 10-year treasury yield hit a three-year high. All the three major indexes ended in the negative zone.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) lost 0.1% or 39.54 points to close at 34,411.69. Nineteen components of the 30-stock index ended in the red, one remained unchanged, while 10 closed in the green.
The tech-heavy Nasdaq Composite lost 0.1% or 18.72 points to finish at 13,332.36.
The S&P 500 slid 0.02% or 0.9 points to end at 4,391.69. Six of the 11 broad sectors of the benchmark index closed in the red.
The Health Care Select Sector SPDR (XLV), the Consumer Staples Select Sector SPDR (XLP) and the Utilities Select Sector SPDR (XLU) slipped 1.1%, 0.8% and 0.5%, respectively. The Energy Select Sector SPDR (XLE) gained 1.5%.
The fear-gauge CBOE Volatility Index (VIX) went down 2.3% to 22.17. A total of 10.35 billion shares were traded on Monday, lower than the last 20-session average of 11.79 billion. Decliners outnumbered advancers on the NYSE by a 1.76-to-1 ratio. On Nasdaq, a 2.36-to-1 ratio favored declining issues.
World Bank Brings Down Growth Forecast
The World Bank reduced its global growth forecast for 2022 by nearly a full percentage point due to the economic impact of Russia's war with Ukraine. The expected economic growth is 3.2% this year, revised from a prior 4.1% forecast. Coupled with China’s reportage of an economic slowdown in March, investors were concerned about the worsening outlook of global markets and made moves accordingly.
10-Year Treasury Yield and Oil Prices Surge
On Monday, the benchmark 10-year U.S. Treasury yield finished at 2.84%, its highest level since December 2018. The benchmark yield has risen more than half a percentage point already in the month of April. Higher yields from risk-free treasury bonds indicate future flows are not profitable in the current valuation, and move in the opposite direction with prices. The aggressive interest rate hikes planned by the Fed have helped push the bond yields to multi-year highs on a regular basis for the last few days. The Fed is now expected to hike rates by at least 50 basis points at its May and June meetings to tackle inflation.
Oil prices closed over 1% higher amid concerns over tight global supply due to the Ukraine crisis. Brent crude closed 1.3% higher at $113.16/barrel after touching $114.8 in the day, its highest since March 28. U.S. crude ended up 1.2% higher at $108.21/barrel.
Investors Wait For Earnings Cue
Investors eagerly await the Q1 earnings reports scheduled for release this week to assess how well companies are tackling inflation. Amid a gloomy outlook for the economy because of raging inflation and planned policy tightening by the Fed, positive earnings surprises have been lifting investor mood in recent sessions. Trading on Monday was influenced by strong growth reported by Bank of America Corporation (BAC - Free Report) , which rounded up a mixed earnings season for big Wall Street Banks.
J.B. Hunt Transport Services (JBHT - Free Report) reported better-than-expected first-quarter 2022 earnings numbers, following which shares of the company gained 1.1% in after-market trading on Apr 18. (Read More).
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Stock Market News for Apr 19, 2022
Wall Street closed lower on Monday, following the World Bank’s reduced growth outlook. Investors adopted a wait-and-watch attitude due to a barrage of earnings reports expected this week. The 10-year treasury yield hit a three-year high. All the three major indexes ended in the negative zone.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) lost 0.1% or 39.54 points to close at 34,411.69. Nineteen components of the 30-stock index ended in the red, one remained unchanged, while 10 closed in the green.
The tech-heavy Nasdaq Composite lost 0.1% or 18.72 points to finish at 13,332.36.
The S&P 500 slid 0.02% or 0.9 points to end at 4,391.69. Six of the 11 broad sectors of the benchmark index closed in the red.
The Health Care Select Sector SPDR (XLV), the Consumer Staples Select Sector SPDR (XLP) and the Utilities Select Sector SPDR (XLU) slipped 1.1%, 0.8% and 0.5%, respectively. The Energy Select Sector SPDR (XLE) gained 1.5%.
The fear-gauge CBOE Volatility Index (VIX) went down 2.3% to 22.17. A total of 10.35 billion shares were traded on Monday, lower than the last 20-session average of 11.79 billion. Decliners outnumbered advancers on the NYSE by a 1.76-to-1 ratio. On Nasdaq, a 2.36-to-1 ratio favored declining issues.
World Bank Brings Down Growth Forecast
The World Bank reduced its global growth forecast for 2022 by nearly a full percentage point due to the economic impact of Russia's war with Ukraine. The expected economic growth is 3.2% this year, revised from a prior 4.1% forecast. Coupled with China’s reportage of an economic slowdown in March, investors were concerned about the worsening outlook of global markets and made moves accordingly.
10-Year Treasury Yield and Oil Prices Surge
On Monday, the benchmark 10-year U.S. Treasury yield finished at 2.84%, its highest level since December 2018. The benchmark yield has risen more than half a percentage point already in the month of April. Higher yields from risk-free treasury bonds indicate future flows are not profitable in the current valuation, and move in the opposite direction with prices. The aggressive interest rate hikes planned by the Fed have helped push the bond yields to multi-year highs on a regular basis for the last few days. The Fed is now expected to hike rates by at least 50 basis points at its May and June meetings to tackle inflation.
Oil prices closed over 1% higher amid concerns over tight global supply due to the Ukraine crisis. Brent crude closed 1.3% higher at $113.16/barrel after touching $114.8 in the day, its highest since March 28. U.S. crude ended up 1.2% higher at $108.21/barrel.
Investors Wait For Earnings Cue
Investors eagerly await the Q1 earnings reports scheduled for release this week to assess how well companies are tackling inflation. Amid a gloomy outlook for the economy because of raging inflation and planned policy tightening by the Fed, positive earnings surprises have been lifting investor mood in recent sessions. Trading on Monday was influenced by strong growth reported by Bank of America Corporation (BAC - Free Report) , which rounded up a mixed earnings season for big Wall Street Banks.
Shares of Marathon Petroleum Corporation (MPC - Free Report) and Valero Energy Corporation (VLO - Free Report) gained 3.3%, and 5.2%, respectively. Valero Energy carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
No economic data was released on Monday.
Stocks That Have Made Headline
J.B. Hunt Shares Up on Q1 Earnings & Revenue Beat
J.B. Hunt Transport Services (JBHT - Free Report) reported better-than-expected first-quarter 2022 earnings numbers, following which shares of the company gained 1.1% in after-market trading on Apr 18. (Read More).