(April 16): US stocks fluctuated on Thursday morning as oil prices gained and traders weighed whether a fragile ceasefire in the Iran war may be extended and mixed first-quarter earnings results.
The S&P 500 Index inched 0.1% lower at 10.12am in New York and spent the early part of the trading session flipping between small gains and losses, as a retreat in tech offset gains in smaller sectors like energy and real-estate. The benchmark closed at a record on Wednesday.
The Nasdaq 100, which posted its own record on Wednesday, has also whipsawed and is on the brink of snapping its 11-session winning streak. The blue-chip Dow Jones Industrial Average fell 0.1%.
“The market could/should be due for some sort of breather soon,” said Matt Maley, chief market strategist at Miller Tabak + Co. He noted the S&P 500 and Nasdaq 100 hit records despite “poor” breadth and are “becoming overbought”.
Oil prices pushed higher on Thursday morning on conflicting headlines about Iran and the blockade at the Strait of Hormuz. The US and Iran are considering an extension to their ceasefire agreement that is set to end next week. Ed Yardeni said April’s stock market rebound is partially driven by investors fear of missing out on peace.
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A busy week in financial sector earnings continues to produce mixed results. Bank of New York Mellon Corp’s shares rose as net interest income beat Wall Street estimates and the board authorised a new US$10 billion share buyback plan. Charles Schwab Corp shares slipped on a revenue miss even as total new assets solidly beat analyst expectations as retail investors put more money into the market.
Markets have also been buoyed by cooler-than-expected producer and import prices this week and received another boost from initial jobless claims dropped for the week ending April 11, and were below economist forecasts.
“The S&P 500’s sharp rally off the late-March lows has been nothing short of impressive, but has the index moved too far, too fast?” Sevens Report founder Tom Essaye wrote on Thursday, noting a drop off in trading volumes.
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Light volumes are also a focus for Kristian Kerr, LPL Financial’s head of macro strategy, who noted S&P 500 trading volumes is below the year-to-date average in each of the last five sessions. “This suggests the move higher is being propelled more by short covering and forced positioning adjustments than by fresh capital being put to work.”
In notable single stock moves, PepsiCo shares climbed as sales and profits beat expectations on a rebound in the Doritos and Lay’s maker’s snack business rebounded. Abbott Laboratories shares slipped after the pharmaceutical company cut its full-year profit forecast.
Taiwan Semiconductor Manufacturing Co US-listed shares are slipping even after the chipmaker said on Thursday it sees 2026 sales growing above 30% in US dollar terms. Elon Musk’s team is seeking quotes from chip suppliers including Applied Materials Inc and Lam Research Corp, both of which advanced, to move at “light speed” for his Terafab project to break into the chipmaking business.
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