(Bloomberg) — A renewed rally in some of the world’s largest technology companies propped up the US stock market, with traders weighing another batch of corporate earnings and positioning for Thursday’s economic data.
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Equities edged higher, with Tesla Inc. leading gains in megacaps after Elon Musk vowed to launch less-expensive vehicles as soon as late this year. Chipmakers also caught a bid on a bullish forecast from Texas Instruments Inc. Later Wednesday, Meta Platforms Inc. is due to report earnings, and Wall Street will be focused on whether the social-media giant will give any signs of returns from the hefty spending on artificial intelligence.
An indicator from JPMorgan Chase & Co.’s trading desk that tracks investor positioning reached a threshold typically followed by gains.
The firm’s US Tactical Positioning Monitor, or TPM, which measures US stock allocations, triggered level that shows an “attractive set-up” for S&P 500 Index, according to Andrew Tyler, the firm’s head of US Market Intelligence. The equity benchmark has gained roughly 3% in the subsequent 20 days after the indicator reached similar level.
The S&P 500 hovered near 5,080. The yen weakened beyond 155 per dollar for the first time in more than three decades, fueling risk that the key level may prompt Japan’s Ministry of Finance to step into the market. Oil fell, though traders kept a close eye on geopolitical risks after the Israeli military said it struck around 40 sites linked to Hezbollah in southern Lebanon.
Treasury 10-year yields rose three basis points to 4.63%. The US will sell $70 billion of five-year notes at 1 p.m. New York time, the largest amount ever offered for such a tenor.
Interest rates staying elevated longer, along with economic uncertainty and geopolitical turmoil have lessened the appeal of some of the stock market’s cheapest strategies.
Investors this month have pulled some $200 million out of value based exchange-traded funds, according to data compiled by Bloomberg Intelligence. In contrast, growth stocks have attracted more than $3 billion in inflows — despite a shaky stock market that’s raised concerns of more downside to come. That diminished interest in cheap stocks comes on the heels of lackluster performances of common value products.
Corporate Highlights:
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Boeing Co. burned through $3.93 billion in cash in the first quarter, a less dramatic drain than analysts had predicted, as the embattled planemaker continues to slow output to get a handle on its manufacturing issues.
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Amazon.com Inc. and Microsoft Corp.’s investments into artificial intelligence startups will get deeper scrutiny from the UK’s antitrust watchdog, the latest example of how global regulators are grappling with how the world’s largest technology firms are influencing the booming market.
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AT&T Inc. beat analysts’ estimates for profit in the first quarter as it added more wireless phone customers than expected.
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Biogen Inc. reported first-quarter profit that beat Wall Street’s expectations as the biotech giant’s new Alzheimer’s drug Leqembi gained traction and cost cuts took hold.
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Visa Inc. reported a quarterly profit that beat Wall Street predictions as US credit-card spending climbed.
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Humana Inc.’s management pulled its guidance for next year amid mounting pressures in its Medicare business but said it’s on track to meet its goals for 2024.
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Mattel Inc. reported a smaller-than-expected first-quarter loss, benefiting from fast sales of its Hot Wheels miniature cars and lower costs.
Key events this week:
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US GDP, wholesale inventories, initial jobless claims, Thursday
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Microsoft, Alphabet, Airbus earnings, Thursday
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Japan rate decision, Tokyo CPI, inflation and GDP forecasts, Friday
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US personal income and spending, PCE deflator, University of Michigan consumer sentiment, Friday
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Exxon Mobil, Chevron earnings, Friday
Some of the main moves in markets:
Stocks
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The S&P 500 rose 0.2% as of 9:31 a.m. New York time
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The Nasdaq 100 rose 0.8%
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The Dow Jones Industrial Average fell 0.1%
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The Stoxx Europe 600 was little changed
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The MSCI World index rose 0.3%
Currencies
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The Bloomberg Dollar Spot Index was little changed
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The euro was little changed at $1.0699
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The British pound was little changed at $1.2454
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The Japanese yen was little changed at 154.92 per dollar
Cryptocurrencies
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Bitcoin fell 0.6% to $65,979.66
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Ether rose 1.3% to $3,250.12
Bonds
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The yield on 10-year Treasuries advanced three basis points to 4.63%
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Germany’s 10-year yield advanced seven basis points to 2.57%
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Britain’s 10-year yield advanced eight basis points to 4.32%
Commodities
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Alexandra Semenova and Carly Wanna.
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