Stocks open slightly as investors consider recession risks

Stocks opened slightly on Monday after the major averages posted a second straight week of losses for the first time since September as investors weighed recession fears.

The Dow Jones Industrial Average rose 29 points, or 0.09%. The S&P 500 and Nasdaq Composite fell 0.14% and 0.43%, respectively.

The moves came after another downward week for stocks The Fed raised the short-term interest rate by 50 basis points Higher rates are indicated for longer. Recession fears mounted as the central bank raised its forecast for future hikes above previous expectations, saying it now expects to raise interest rates to 5.1%.

“As we approach the end of December, investors are still waiting for the Santa Claus rally, with stocks falling for consecutive weeks for the first time since September,” said Chris Larkin, managing director of trading at E*Trade. From Morgan Stanley. “Data showing inflation slowing may have given the market a short-term boost, but the Fed’s steadfastness with Powell’s drive home the point that interest rates can remain high for an extended period is likely cause for some investors.”

Shares are set for a dismal month in December. On Friday, the Dow Jones fell 281.76 points, or 0.85%. The 30-share index fell 1.66% for the week, bringing its monthly losses to 4.83%. The S&P 500 fell 1.11% and declined 2.08% for the week, extending its monthly declines to 5.58%. The Nasdaq Composite fell 0.97% on Friday and 2.72% for the week. It is down 6.65% this month.

Investors will also be watching for some earnings reports due later in the week. FedEx and Nike are both scheduled to report earnings results on the Tuesday after the market closes. As recession fears mount, earnings results will become more focused.

“Rates and inflation may have peaked but we see this as a warning signal for profitability, a fact we believe remains underappreciated but can no longer be ignored,” Michael Wilson, equity strategist at Morgan Stanley, wrote in a note Monday.