Market Updates

U.S. Major Averages Hover Near Record Highs as Earnings Roll In

Barry Adams
23 Jan, 2024
New York City

    U.S. stocks were little changed in early trading, and investors turned cautious after three leading indexes hovered near record highs.

    The Dow Jones Industrial Average surpassed 38,000 for the first time in Monday's trading, and the S&P 500 and the Nasdaq 100 traded near their record highs.

    Airline stocks were higher after United Airlines reported strong fourth quarter results, but the company forecasted a loss in the first quarter after the aviation regulator ordered the grounding of 737 Max 9 planes for emergency inspection following the Alaska Airlines midair door incident.

    United Airlines jumped 6% to $40.97.

    Crude oil was also in focus after the U.S. and U.K. carried out additional military strikes targeting Houthi rebel bases in Yemen.

    The attacks on Monday, supported by Australia, Bahrain, Canada, and the Netherlands, targeted eight sites used for arms and supply storage and missile surveillance capabilities.

    Trading activities across Europe were muted ahead of the European Central Bank's rate decision on Thursday.

    Investors are expecting the central bank to hold rates steady and provide more clarity about the future direction of interest rates, despite policymakers pushing back against rate-cut expectations this year.

    In Asia, the Bank of Japan held its short-term interest rate at -0.1% and kept the yield around zero, with the upper limit near 1% on 10-year Japanese government bonds.

    The central bank also lowered its 2024 inflation outlook to 2.4% from its previous estimate of 2.8% released in October.

    Market indexes in Shanghai and Hong Kong advanced, and the yuan jumped to 7.18 against the U.S. dollar after China's cabinet pledged to take more "stronger and more effective" measures to "stabilize financial markets" and "improve market confidence."

     

    U.S. Indexes and Yields

    The S&P 500 index increased 0.3% to 4,855.85, and the Nasdaq Composite rose 0.5% to 15,381.77.

    The yield on 2-year Treasury notes increased to 4.41%. 10-year Treasury notes advanced to 4.13%, and 30-year Treasury bonds edged up to 4.35%.

    WTI crude oil decreased $0.63 to $74.11 a barrel, and natural gas prices decreased 2 cents to $2.39 a thermal unit.

    Gold increased by $5.22 to $2,026.25 an ounce after declining in the previous week following the general strength in the U.S. dollar.

    The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 103.40.

     

    U.S. Stock Movers

    American Airlines rose 3% to $14.02, and Delta Air Lines advanced 2.4% to $37.85 after United reported strong quarterly results.

    General Electric declined 3% to $127.30 after the industrial engineering company estimated weaker-than-expected first quarter results.

    The company's fourth-quarter results were ahead of market expectations, but investors focused on the current quarter's business conditions.

    Procter & Gamble gained 1.5% to $150.0 after the consumer products maker reported mixed quarterly results.

    3M declined 6.6% to $100.86 after the company estimated weak current quarter and full-year earnings estimates.

    The diversified conglomerate estimated earnings per share in the first quarter between $2.0 and $2.15 and for the full year between $9.35 and $9.75.

    Halliburton Company increased 1.5% to $34.95 after the oil field service provider reported mixed quarterly results for its fourth quarter.

    Logitech International dropped 6.5% to CHF 77.56 after the computer accessories maker estimated an annual sales decline between 6% and 7%.

    Revenue in the fiscal third quarter ending in December declined 1% to $1.26 billion, net income rose to $247.7 million from $140.5 million, and diluted earnings per share rose to $1.57 from 87 cents a year ago.

    The company revised its sales outlook for the fiscal year 2024 to range between $4.2 billion and $4.25 billion, a decline between 6% and 7% compared to the previous estimate of between $4.0 and $4.15 billion, a decline between 9% and 12%.

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