Stock Market News | Wells Fargo Investment Institute

Opening Comment — Tuesday, May 30, 2023

DJIA: 33,093.34, up 328.69
S&P 500: 4,205.45, up 54.17
NASDAQ: 12,975.69, up 277.60

Global equities rise on tentative debt ceiling agreement

U.S. equity futures are higher Tuesday after President Joe Biden and House Speaker McCarthy reached a tentative deal on the debt ceiling over the weekend. This morning, the Dow is flat from Friday’s close after U.S. markets were closed on Monday. The S&P 500 is up 0.6% in pre-market action. The Nasdaq 100 is trading 1.4% above fair value on the GLOBEX.

U.S. equities closed higher on Friday on optimism that lawmakers could strike a deal to lift the debt limit and avoid default. On the data front, the PCE (Personal Consumption Expenditures) deflator rose 0.40% month over month, ahead of consensus (0.30%), and leading to a 4.40% year-over-year increase. Despite elevated inflation, personal income and personal spending appeared robust in April, advancing 0.4% and 0.8% respectively. Durable goods orders rose 1.1% in April after surging a revised 3.3% in March. Bond yields were mixed as debt-ceiling talks continued. On Friday, the Dow jumped 328 points (1.0%) while the Nasdaq Composite rose by 2.2%. The S&P 500 increased by 1.3% with eight of 11 sectors finishing in positive territory.

On the data front today, the S&P Corelogic Case-Shiller 20-City composite home price index month-over-month is expected to be up five basis points (0.05%) in March, after gaining 0.06% in February. The year-over-year estimate is for a 1.6% decline in home prices. The Conference Board Consumer Confidence Index is forecast to decline to 99.0 in May from 101.3 in April.

Over in the commodity pits, West Texas Intermediate (WTI) crude is down 0.92% to $71.75/barrel as traders assess mixed messages from the Organization of Petroleum Exporting Countries and their allies (OPEC+). In the metals complex, gold is up slightly at $1954.50/ounce.

Across the pond, European markets are mixed in mid-day trading ahead of a U.S. debt ceiling vote expected on Wednesday. Overnight in Asia, markets were generally higher with the Hong Kong market bouncing back from a four- day losing streak, gaining 1.0% in the final hour of trading. Chinese markets and South Korean markets all closed higher. In Japan, the unemployment rate ticked lower to 2.6% in April from 2.8% in March. In FOREX trading, the U.S. dollar is down slightly against a basket of major currencies.

Closing Comment — Friday, May 26, 2023

DJIA: 33,093.34, up 328.69
S&P 500: 4,205.45, up 54.17
NASDAQ: 12,975.69, up 277.60

Stocks rally on hopes for a deal

U.S. equities closed 1.3% higher on Friday on optimism that lawmakers could strike a deal to lift the debt limit and avoid default. Negotiators are targeting a resolution that would raise the U.S. spending cap for two years. On the data front, the PCE (Personal Consumption Expenditures) deflator rose 0.40% month over month, ahead of consensus (0.30%), and leading to a 4.40% year-over-year increase. Despite elevated inflation, personal income and personal spending appeared robust in April, advancing 0.4% and 0.8% respectively. Durable goods orders rose 1.1% in April after surging a revised 3.3% in March. Bond yields were mixed as debt-ceiling talks continued. Today, the Dow jumped 328 points (1.0%) while the Nasdaq Composite rose by 2.2%. The S&P 500 increased by 1.3% with eight of 11 sectors finishing in positive territory.

U.S. Treasury yields were mixed. The benchmark 10-year note yield slipped by two basis points (0.02%) to 3.80%, and the 30-year bond yield fell by three basis points (0.03%) to 3.96%. Meanwhile, the yield on the two-year note increased by three basis points (0.03%) to 4.56%. In commodities, West Texas Intermediate (WTI) crude rose to $72.82/barrel as markets evaluated conflicting messages about potential supply cuts ahead of the June 4 Organization of Petroleum Exporting Countries and their allies (OPEC+) meeting. Enjoy the Memorial Day weekend!

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