U.S. Major Averages Struggle to Advance After a Series of Record Highs Last Week

Barry Adams
17 Jun, 2024
New York City

In a holiday-shortened week, market indexes rested around the flatline in Monday's trading. 

The S&P 500 index and the Nasdaq Composite lacked direction on Wall Street as investors awaited the release of retail sales data on Tuesday and housing starts and completions updates later in the week. 

Retail sales in May are expected to rebound by 0.3%, and industrial output is expected to rise by 0.2%.

Investors are hoping that building permits, housing starts, and completions will show sustained increases reflecting the prior month's growth rate.

The S&P500 index and the Nasdaq Composite advanced in seven of the last eight weeks, and market participants are hoping that the benchmark indexes can retain their upward bias. 

Last week, market indexes in the U.S. created a series of new highs, political turmoil engulfed many countries in Europe in the wake of the European Union elections, and trade tensions rose between China and the EU.

The U.S. Federal Reserve held steady its key interest rate range as widely expected and also retained its economic growth and jobless rate outlook.

But the central bank also lowered the number of possible rate cuts to only one from the previous estimate of as many as three in March.

Moreover, the pace of consumer price inflation slowed to 3.3% in May, and the core rate of inflation slowed to a three-year low of 3.4%.

Fed policymakers have struggled over the last year in bringing down inflation from over 3% to the Fed’s target rate of 2%, despite eleven rate cuts spread over 2022 and 2023.

On the earnings front, CarMax, Darden Restaurants, Kroger, and Lennar are some of the leading companies scheduled to release earnings this week. 

 

U.S. Indexes and Treasury Yields

The S&P 500 index decreased 0.1% to 5,427.12, and the Nasdaq Composite rose 0.01% to 17,690.01. 

The yield on 2-year Treasury notes edged lower to 4.74%, 10-year Treasury notes decreased to 4.26%, and 30-year Treasury bonds edged higher to 4.40%.

WTI crude oil increased $0.53 to $78.98 a barrel, and natural gas prices fell 5 cents to $2.82 a thermal unit.

Gold decreased by $14.31 to $2,318.15 an ounce, and silver fell 29 cents to $29.25. 

The dollar index, which weighs the U.S. currency against a basket of foreign currencies, edged lower to 105.56.

 

U.S. Stock Movers

Autodesk increased 4.5% to $235.03 after activist investor Starboard Value acquired a $500 million stake in the software developer. 

Lennar Corp. declined 0.4% to $154.50 ahead of the company's quarterly results this week. 

The home builder reported, in the quarter ending in May 2023, revenue of $8.05 billion, net income of $871.69 million, and diluted earnings per share of $2.94.