Stock market today: Stocks mixed as focus turns to inflation data

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U.S. stocks were mixed in early trading Tuesday, with tech a bright spot as Wall Street kicked off a holiday-shortened week by focusing on an upcoming inflation report closely watched by the Federal Reserve.

The benchmark S&P 500 (^GSPC) held flat, while the tech-heavy Nasdaq Composite (^IXIC) added about 0.5% after strong closing gains Friday. The Dow Jones Industrial Average (^DJI), which lists fewer tech names, slipped about 0.3%.

Major indicators are regrouping after a volatile week as traders return from the Memorial Day break. Stocks have been buffeted by two impulses: on the one hand, waning optimism about rate cuts, and, on the other hand, high hopes for AI. The latter is led by Nvidia (NVDA), whose shares continued their post-earnings trend, gaining 3% in premarket trading.

Investors are now firmly back on inflation watch, awaiting Friday’s release of the Federal Reserve’s preferred PCE gauge. Fed officials have issued a series of warnings that data must show a real slowdown in inflation to trigger a policy change, with Neel Kashkari the latest to join them.

Learn more: How does the labor market affect inflation?

Those comments, along with better-than-expected economic numbers and hawkish Fed minutes, prompted traders to scale back their bets on lower interest rates this year. Data researchers will receive updates later this week on first-quarter GDP and consumer confidence, which could prove catalysts.

Among other individual moves, shares of GameStop (GME) soared as much as 22% on Tuesday. The gaming retailer said Friday it brought in nearly $1 billion from stock sales during the meme rally in early May. Meanwhile, Apple ( AAPL ) rose on data showing iPhone sales in China jumped more than 50% in April as retail partners cut prices.

Live7 updates

  • GameStop shares jump after closing nearly $1 billion stock sale

    GameStop (GME) stock jumped 22% on Tuesday, opening at around $23. The moves come after the video game retailer announced it had raised nearly $1 billion through its latest stock offering.

    Although shares are still well below the near $65 level reached earlier this month during a short-lived rally, the stock price reflects investors’ exuberance over the meme trade.

    Yahoo Finance’s Ines Ferré reports:

    “If this were a normal market, people would be a little panicked,” Steve Sosnick, chief strategist at Interactive Brokers, told Yahoo Finance.

    He added: “You don’t sell shares in the market if you think your shares are undervalued. You do this when you think your stocks are overvalued.

    GameStop is a heavily shorted stock, with short interest just above 21% of the float.

    The company took advantage of the unexpected rebound in mid-May to sell 45 million shares to raise about $933 million, according to a statement released Friday.

    GameStop said it intends to use the net proceeds for general corporate purposes, which may include acquisitions and investments.

    The offering was first announced on May 17 alongside the company’s preliminary financial results, sending shares down as much as 30% that day.

    The offer was seen as a smart move by some Wall Street analysts amid tough financial times for the video game retailer. GameStop’s quarterly sales fell sharply from the year-ago period, according to its latest earnings report.

  • San Diego sees biggest increases in real estate prices

    While house prices hit a new all-time high in March, some cities remained more sensitive to rising costs.

    Regionally, San Diego continued to see the largest year-over-year increase among the 20 major cities, with an 11.1% increase in March. New York and Cleveland also increased by 9.2% and 8.8%, respectively.

    High mortgage rates, high housing prices and limited housing stock have challenged buyers. In March, mortgage rates hovered around the mid-6% range. Last week, they fell below 7% for the first time since early April.

    Despite pent-up demand for housing, low inventory remains a problem, which has not allowed housing prices to fall. But this dynamic should change.

    “While we expect mortgage rates to decline over the next few years, we also expect inventory to gradually normalize, which should help calm the market.” Thomas Ryan, North American economist at Capital Economics, wrote in a note to clients after publication. Ryan and his team expect house prices to rise 3% in 2025 and 2.5% in 2026.

  • House prices hit new records, data shows

    The seasonally adjusted S&P CoreLogic Case-Shiller National Housing Price Index (HPI) rose 0.3% month-over-month in March and 6.5% on an annual basis – the second annual gain on stronger since late 2022, Oxford Economics said in a statement. note to customers following the release of the data.

    “We expect house price growth to remain positive over the coming quarters, with risks tilted to the upside,” wrote Bernard Yaros, chief economist at Oxford Economics. “Scarce supply in the resale market, a robust job market and pent-up demand from Millennials aging into their peak household formation years argue for higher housing prices potentially firmer than in our basic forecasts.

    Prices in the 20 largest U.S. metro areas hit a new record high in March, according to the data.

    (Source: Oxford Economics/Haver Analytics)(Source: Oxford Economics/Haver Analytics)

    (Source: Oxford Economics/Haver Analytics)

    Yaros added that while he expects “mortgage rates to fall as the Federal Reserve’s first rate cut appears,” prices are expected to continue to remain elevated amid “historically constrained” supply. of housing for sale.

    Meanwhile, the Federal Housing Finance Agency’s (FHFA) seasonally adjusted home price index also increased during the month of March, but at a slower pace than in previous months. The index rose just 0.1% after rising 1.2% month-over-month in February.

    “Although base effects have started to become less favorable for the FHFA index, it continues to increase on an annual basis faster than most of 2023,” Yaros said.

  • Consumer confidence rebounds for the first time in 3 months

    Consumer confidence rose unexpectedly in May.

    The Conference Board’s latest index was 102, above 97.5 in April and higher than expected by the 96 economists surveyed by Bloomberg. The May figure ended three months of decline in the index.

    “Consumers’ assessment of current economic conditions was slightly less positive than last month,” Conference Board chief economist Dana Peterson said in the release. “However, strong labor market conditions continued to strengthen consumers’ overall assessment of the current situation. Views of current labor market conditions improved in May, as fewer respondents said jobs were ‘hard to find’.”

    Peterson added: “Fewer consumers expected future business conditions, job availability and income to deteriorate, leading to an increase in the expectations index. »

  • The Dow Jones falls, the Nasdaq gains at the opening

    U.S. stocks opened mixed on Tuesday, with technology a bright spot ahead of a critical inflation report due later this week.

    The benchmark S&P 500 (^GSPC) climbed about 0.2%, while the tech-heavy Nasdaq Composite (^IXIC) added about 0.4% after strong closing gains Friday . The Dow Jones Industrial Average (^DJI) was the biggest laggard of the morning, falling 0.3%.

  • Foot Locker is not out of the woods

    Foot Locker (FL) has had a horrible 12 months.

    Poor financial performance has led to a surprisingly poor outlook, sending shares down 16% over the past year.

    The Street is bracing for another dreadful quarter from the sneaker and sportswear retailer in its report Thursday morning.

    Evercore ISI analyst Michael Binetti said investors should expect a “very difficult quarter.” The company could warn again for the whole year.

    He highlighted several reasons why:

    “In addition to pressured lower-income consumers, we believe key product launches like the Air Max DN have underperformed, and the recent Jordan 4 Industrial Blue is selling below MSRP in the resale channel ($185). $ versus $215 MSRP).”

  • Evercore ISI’s Take on Trump Tariffs 2.0

    We’ve started to see Wall Street crunch the numbers on the economic impact of new tariffs that former President Trump would like to implement if he wins a second term.

    Today, Evercore ISI weighs in with its take:

    “Presidents rarely adopt or implement the entirety of a campaign idea and Trump in particular likes to use bold ideas as a starting point. Nevertheless, it is essential to understand what dramatic starting point Trump has advanced, because it has implications for the future, the combination of the proposed 10% general tariff and the 60% Chinese tariff would result in an overall weighted average U.S. tariff rate of nearly 17%, the highest. since the 1930s. On a static basis (i.e. without assuming dynamic economic effects), customs duties would increase from 0.3% of GDP to 1.9% of GDP, an increase of more than $400 billion per year.

    Are markets underpricing a new Trump trade war?Are markets underpricing a new Trump trade war?

    Are markets underpricing a new Trump trade war? (EvercoreISI)



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