Navigating A Week of Central-Bank Meetings & Corporate Earnings: Yield on 10-Year U.S. Treasury Note & S&P500 Earnings In Focus
This week investors are carefully navigating a week of central-bank meetings and corporate earnings. The yield on the benchmark 10-year U.S. Treasury note ticked up to 3.551% Monday morning after ending a three-week losing skid last week. The 10-year yield climbed 7 basis points to 3.56%, while the 2-year yield rose 3 basis points to 4.16%. The U.S. dollar index ticked up 0.06% to $101.99.
On the economic front, the Commerce Department’s personal-consumption-expenditures price index rose 0.1%, cooling the annual inflation rate to 5% from 5.5%. The core Personal Consumption Expenditures (PCE) prices, not including food and energy, increased by 0.3%, causing the yearly core inflation rate to drop to 4.4% from 4.7 The Bureau of Economic Analysis reported that fourth quarter GDP grew at a 2.9% annual rate, topping views, but almost half that gain was due to a buildup in inventories amid slower consumption. In December, personal spending decreased by 0.2%, marking the second consecutive month of a decrease, as consumers became more wary.
Meanwhile, collective S&P 500 earnings are expected to fall 2.9% from last year to a share-weighted $443.4 billion, before recording a modest 0.1% expansion over the three months ending in March. To date, 143 companies have reported their earnings for the S&P 500, and the collective total is expected to be $443.6 billion, which is a 2.9% decrease from last year.
At the start of the trading day on Wall Street, futures tied to the the S&P 500 are priced for a 29 point opening bell decline while those linked to the Dow Jones Industrial Average are set for a 180 point decline. The Nasdaq, which has a focus on technology, was down 120 points.
Intel (INTC) stock plunged 6.4% today after the chipmaker said fourth-quarter earnings fell 92% year-over-year to 10 cents per share, well below the 20 cents per share analysts were expecting. Revenue fell to $14.0 billion, representing a decrease of 32% from the same period last year, and was lower than expectations. For Q1, the company projected earnings and revenue to be lower than expected.
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