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Major market averages opened trading on Monday morning in a relatively cautious fashion as traders brace for a big week of economic activity and ongoing tensions in the Mideast.
Early on, the Nasdaq Composite (COMP.IND), S&P 500 (SP500), and the Dow (DJI) were all mostly unchanged.
In “an action-packed slate of activity” for the week, the “FOMC ending Wednesday and Payrolls on Friday are the most obvious landmarks, but we also have 24% of the S&P 500 (Microsoft, Apple, Alphabet, Amazon and Meta), and with $10.5tn of market cap, reporting in a 48-hour window from Tuesday night,” Deutsche Bank’s Jim Reid said. “If that’s not enough the US Treasury Quarterly Refunding Announcement is out on Wednesday.”
“The last two editions have coincided with first a huge sell-off in bonds and then a huge rally. The precursor is today’s Treasury’s borrowing estimate which is out at 3pm EST. Our rates strategists (don’t see any major surprises this week but it’s clearly going to be heavily scrutinized).”
“Other US highlights include the JOLTS data and consumer confidence tomorrow, the ADP report on Wednesday and the ISM manufacturing index on Thursday.”
Rates were lower. The 10-year Treasury yield (US10Y) fell 3 basis points to 4.10%. The 2-year yield (US2Y) fell 2 basis points to 4.33%.
This week, the “FOMC, Riksbank and the Bank of England are all likely to leave rates on hold,” SocGen’s Kit Juckes wrote. “But the focus will be on what the Fed says and how they adjust the message from December, when the opening paragraph of the Statement talked of slower growth and falling but still elevated inflation. Since then, economic data have surprised to the upside more often than not and inflation data, if anything, have surprised to the downside.”
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