US stocks rose on Monday, boosting a rebound from Wall Street’s worst week this year.
The S&P 500 (^GSPC) rose 0.3%, while the Dow Jones Industrial Average (^DJI) rose 0.2%. Contracts on the technology-heavy Nasdaq Composite (^IXIC) rose 0.6%.
The yield on the 10-year US Treasury fell to 3.93% on Monday.
On the economic data side, new orders for manufactured durable goods fell in January to 4.5%, the largest decline since April 2020. The Census Bureau reported. The decline was more pronounced than economists’ estimate of 4.0%.
“The manufacturing sector will remain under pressure in the coming months, but details of the January report of durable goods orders and shipments indicate that factory activity started the year better than the headline number would suggest,” Lydia Bosseur, chief economist at EY Parthenon wrote in a statement after Release.
Meanwhile, the National Association of Realtors’ index of pending home sales rose 8.1% to 82.5 in January, up sharply from the 1.0% rise expected by Bloomberg economists, according to data released Monday. However, on a year-over-year basis, pending transactions were down nearly 24%.
“The increase in the pending home sales index confirms that the US housing market has improved, or better, stabilized somewhat over the past several months due to lower mortgage interest rates,” Chief Economist Raymond James Eugenio Aleman wrote in a statement to Yahoo Finance. . . “However, the recent increase in mortgage rates is likely to inflict more pain on the US housing market in the future.”
Stocks closed out their worst week of 2023 on Friday after the Fed’s favorite measure of inflation showed it unexpectedly accelerated in January and consumer spending jumped. The “core” PCE price index – which excludes the volatile food and energy components – showed prices rising 0.6% in January and 4.7% from a year ago.
The Commerce Department also reported that consumer spending rose 1.8% last month compared to December, the largest increase in nearly two years. The survey results renewed concern among investors that the Fed will continue its aggressive tightening campaign against inflation.
Decreased optimism pressured major indices, with the Dow Jones falling 3% for a fourth straight week of losses, while the S&P 500 fell 2.7% in its worst week since early December and the Nasdaq Technologies fell 3.3%.
Data compiled by 22V Research found that rising interest rates have pushed the correlation between growth stocks and value to the highest level since at least 2005.
This week, investors will remain wary of the retail sector, with earnings from Target (TGT) on deck before the market opens on Tuesday after Walmart (WMT) warned of cautious profit guidance for next year. Home improvement giant Home Depot (HD) also had disappointing guidance for fiscal 2023.
Elsewhere on the earnings calendar are results from Costco (COST), Macy’s (M), Dollar Tree (DLTR), and Kohl’s (KSS) to highlight the retail side.
Meanwhile, the share of companies that beat analyst expectations in the fourth quarter was low on record. Data from FactSet It showed that 68% of S&P 500 companies reported fourth-quarter earnings that beat expectations, down from the five-year average of 77% and the 10-year average of 73%.
On individual stock movements, shares of Seagen Inc. jumped. (SGEN) On Monday morning after a a report The Wall Street Journal reported that Pfizer Inc (PFE) is in early talks to acquire the cancer drug company in a deal that could be worth billions of dollars.
Berkshire Hathaway Inc. stock rose. (BRK-B) after CEO Warren Buffett Annual letter to shareholderswhich gave readers a glimpse into his views on stock buybacks, taxation, corporate accounting, and his sense of optimism about the economy.
Shares of fuboTV (FUBO) sank after the sports-focused streaming service issued disappointing guidance in its fourth-quarter earnings report on Monday and revealed that it had sold shares at a deep discount.
Shares of Fisker (FSR) jumped Monday after the electric vehicle startup announced that deliveries of its first vehicle, the Ocean SUV, would be completed by spring.
Shares of Union Pacific (UNP) jumped after the largest shipping company announced plans to announce its plans New CEO After pressure from activists to remove Lance Fritz from the job.
Shares of Bath & Body Works (BBWI) tumbled after the company he said in a letter to shareholders That the looming proxy battle is based on “misguided” motives and would be detrimental to shareholders. The Board of Directors decided not to appoint Mounib Islam, the former co-chief investment officer of Third Point.
Elsewhere, in cryptocurrency news, Coinbase (COIN) said in a tweet that it will soon suspend trading of the Binance stablecoin, Binance USD, on March 13 at noon EST. This step comes next Paxos Trust revealed It will stop creating a Binance-branded stablecoin, citing regulatory pressure.
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Danny Romero, Yahoo Finance correspondent. Follow her on Twitter @employee
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