Stocks On Wall Street Face Headwinds, Boeing In Focus

Barry Adams
08 Jan, 2024
New York City

Stocks struggled for the second week in a row in the new year after investors curbed their rate-cut optimism and awaited the start of the earnings season later in the week.

The S&P 500 index and the Nasdaq Composite edged down in early trading, and investors debated future rate paths ahead of the release of inflation data later in the week.

Market participants remained cautious for the second week in a row after the hotter-than-expected nonfarm payrolls report and the hawkish tone of the minutes of the Fed's meeting in December dashed all hopes of rate cuts in March.

Banks are scheduled to kickstart the earnings season this week, and Bank of America, Citigroup, JP Morgan Chase, and Wells Fargo are expected to release their quarterly results.

United Health, Delta, Black Rock, and Delta Air Lines are also among the leading companies scheduled to release their results.

Fiscal year budgets and government spending were also in focus as Congressional leaders announced a deal on Sunday to keep total spending at $1.59 trillion.

 

U.S. Indexes and Yields

The S&P 500 index increased 0.07% to 4,736.25, and the Nasdaq Composite increased 0.2% to 14,633.52.

The yield on 2-year Treasury notes decreased to 4.39%, 10-year Treasury notes held steady at 4.04%, and 30-year Treasury bonds rose to 4.20%.

Crude oil prices declined in Monday's trading after Saudi Arabia said it plans to cut oil prices in February for deliveries in all regions amid softening demand and rising global oil supplies.

WTI crude oil decreased $2.71 to $71.15 a barrel, and natural gas prices decreased 10 cents to $2.79 a thermal unit.

Gold decreased $21.41 to $2,024.14 an ounce and extended losses from the last week as investors cooled rate-cut hopes and awaited the release of inflation data later in the week.

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 102.42.

 

U.S. Stock Movers

Boeing Company declined 6.3% to $233.03 after the Federal Aviation Authority temporarily grounded 737 Max 9 aircraft for an emergency safety inspection.

The FAA ordered the grounding after a plug door unlocked and fell off midair during an Alaska Air flight on Friday after takeoff from Portland, Oregon, heading to Ontario, California.

Of the 171 aircraft grounded by the FAA, Alaska Airlines has 65 planes, United Airlines has 79, and the rest are with six international airlines, including the discount airline Lion Air.

The aircraft maker has been struggling with pandemic-era supply chain disruptions and two plane crashes in Ethiopia and Indonesia in 2018 and 2019. that killed 346 people.

The fuselage maker, Spirit AeroSystems, plunged 13.5% to $27.43 after the panel incident.

Lululemon Athletica declined 1.4% to $484.50 despite the specialty apparel retailer lifting its outlook.

The company lifted its fourth quarter earnings estimate range to between $4.95 and $5.0 from the previous estimate between $4.85 and $4.93.