By Chuck Mikolajczak
NEW YORK (Reuters) – The Nasdaq closed almost unchanged as the Nasdaq fell after a volatile session on Tuesday as investors assessed inflation data and prepared for quarterly earnings reports to justify stock valuations and the strength of stocks. the American economy.
Shares swung between gains and losses throughout the day. stocks received an initial boost from a Labor Department report that showed the producer price index rose less than expected in December, although the report failed to materially affect expectations about the likely path of the Fed's monetary policy. Federal this year.
But early gains evaporated as investors awaited Wednesday's consumer price index reading, which will further shape expectations for inflation and the Federal Reserve.
“There was a relief rally at first, but it shows that there is an inherent level of uncertainty about where rates and the Fed are headed,” said Chris Fasciano, chief market strategist at Commonwealth Financial Network.
“Now we will see what tomorrow morning has in store for us,” he said, referring to the CPI report.
According to preliminary data, the S&P 500 gained 6.49 points, or 0.11%, to finish at 5,842.71 points, while the Nasdaq Composite lost 43.71 points, or 0.23%, to 19,044.39 . The Dow Jones Industrial Average rose 220.67 points, or 0.52%, to 42,515.72.
The market is pricing in about 29 basis points of rate cuts by the Federal Reserve by the end of 2025, according to LSEG data, and expectations for a cut of at least 25 basis points will not exceed 50% until the June meeting. .
Adding to investor caution, U.S. Treasury yields remained at elevated levels, with the yield on the benchmark 10-year Treasury note remaining near a 14-month high hit on Monday.
Quarterly earnings begin Wednesday with results from big banks, which are expected to post stronger earnings, driven by strong trading and trading. The S&P 500 banking index advanced.
Shares of Goldman Sachs rose ahead of its earnings results scheduled for Wednesday and helped keep the Dow Jones in positive territory.
The benchmark S&P 500 index is trading at valuations well above its long-term historical average, and a disappointing earnings season could jeopardize further gains for stocks.
The healthcare sector was among the worst performers of the 11 major S&P sectors, as Eli Lilly (NYSE ) stumbled after forecasting that fourth-quarter sales of weight-loss drug Zepbound were below estimates.
Kansas City Fed President Jeff Schmid said the impact of Trump's policies was an “active conversation” at the central bank and that it would respond if its inflation or employment goals veer off course.
After recovering following the U.S. election, stocks have struggled recently, with the S&P 500 falling in four of the previous five weeks as a resilient economy, persistent inflation and comments from U.S. policymakers Fed have fueled concerns that the central bank will be less aggressive in cutting interest rates. than previously anticipated.
Concerns also persist about possible tariffs from the Trump administration that would further stoke inflation.
Boeing (NYSE fell after the plane maker's annual deliveries fell in 2024 to their lowest level since the pandemic.
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