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Stock Market News for Feb 27, 2024

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U.S. stock ended lower on Monday as investors shifted focus from last week’s AI-fueled rally to the key inflation data scheduled for release later this week. All three major indexes ended in negative territory.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) slid 0.2% or 62.30 points to finish at 39,069.23 points.

The S&P 500 declined 0.4% or 19.27 points, to close at 5,069.53 points. Utilities and communication services stocks were the worst performers.

The Utilities Select Sector SPDR (XLU) fell 2%, while the Communication Services Select Sector SPDR (XLC) declined 1.5%. Eight of the 11 sectors of the benchmark index ended in negative territory.

The tech-heavy Nasdaq dropped 0.1% or 20.57 points to finish at 15,976.25 points.

The fear-gauge CBOE Volatility Index (VIX) was down 0.07% to 13.71. Decliners outnumbered advancers on the NYSE by a 1.6-to-1 ratio. On Nasdaq, a 1.2-to-1 ratio favored advancing issues. A total of 10.89 billion shares were traded on Monday, lower than the last 20-session average of 11.66 billion.

Rally Halts Ahead of Release of Inflation Data

Major indexes retreated from their recent highs on Monday as treasury yields soared once again and as investors left behind last week’s AI-driven rally and upbeat earnings reports from a spate of companies.

The 2-year Treasury yield jumped to its highest level in three months, while the 10-year Treasury yield rose to 4.276%, up by 1 basis point.

Markets started on a high this week helped by NVIDIA Corporation’s ((NVDA - Free Report) ) blowout earnings last week that saw the S&P 500 and Dow hitting all-time highs. However, investors shifted focus to January’s personal consumption expenditures price index (PCE) reading, which is scheduled for release later this week.

The data could dampen investors’ spirits if it suggests that price pressures aren’t cooling fast enough. This saw stocks giving up some of the gains from Friday.

This is going to be a busy week as a lot of economic data will be released, including the first revision to the fourth-quarter gross domestic product.

Amazon Joins Dow, Inc ((AMZN - Free Report) ) joined the 30-stock Dow on Monday. The e-commerce giant replaced Walgreens Boots Alliance, Inc. ((WBA - Free Report) ) because of higher share price. Dow weighs its holdings based on the share price and not market cap. Amazon sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Amazon’s inclusion in the Dow will give the index more exposure to tech and retail sectors.

Economic Data

In economic data released on Monday, the Commerce Department's Census Bureau said that new single-family homes increased 1.5% month over month in January to a seasonally adjusted 661,000 units.


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