Stocks rebound as investors shake off Mideast tensions, focus on earnings
U.S. stocks rose Monday as concerns about fallout from Iran’s attack on Israel eased, shifting the focus back from earnings season and inflation risks to rate cut hopes.
The S&P 500 (^GSPC) gained about 0.5%, while the Dow Jones Industrial Average (^DJI) rose 0.5%, or more than 360 points, after ending the week with strong losses. The tech-heavy Nasdaq Composite (^IXIC) rose 0.4%.
The focus is shifting as investors shrug off initial fears of a full-scale war in the Middle East following Iran’s direct missile and drone attack on Israel on Saturday. U.S. efforts to encourage Israel not to retaliate helped ease tensions, in part because the well-telegraphed attack helped contain the damage.
Stocks have been under pressure in recent days as earnings season got off to a weak start and concerns persisted that inflation was slowing toward the Federal Reserve’s 2% target. Traders have scaled back their bets on the extent of the Fed’s interest rate cuts this year in the face of disappointing economic data.
Retail sales in March increased 0.7% from the previous month as consumers continued to spend despite a higher interest rate environment. The monthly figure exceeded economists’ expectations with an increase of 0.4%, according to Bloomberg data.
Goldman Sachs (GS) got this week’s results off to a strong start on Monday, as investors look to company results to reignite the early 2024 stock market rally. Shares of the Wall Street lender rose more by 5% after first-quarter profits beat estimates.
In the commodities sector, oil prices fell more than 1% on Monday after rising on the eve of the Iranian airstrikes. West Texas Intermediate crude futures (CL=F) were trading around $85 per barrel, while Brent crude futures (BZ=F) were near $90.
Meanwhile, the 10-year Treasury yield (^TNX) added about 10 basis points to trade near 4.61%, coming back from a sharp decline Friday to eye a return to the five-year high month of last week. Another safe-haven gold (GC=F) fell after gaining as much as 1.2% last week as tensions in the Middle East intensified.
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News Source : finance.yahoo.com
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