April 24, 2024

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The picture on the wall is improving, and the Nasdaq continues with small gains

The picture on the wall is improving, and the Nasdaq continues with small gains

The picture is improving on Wall Street, with the Dow Jones Industrial Average and the broader S&P 500 paring early losses and the tech-heavy Nasdaq index regaining a positive sign after a negative start in the harsh climate created today by Samsung Electronics' warning about its profitability trajectory.

The Nasdaq jumped 2.2% on Monday with big tech names like Apple (+2.4%) and Nvidia (+6.4%) leading the gains. However, Samsung Electronics' warning today has once again raised concerns about the path of demand in a weak macroeconomic environment shaped by successive interest rate hikes by central banks to address inflation.

Samsung Electronics warned that fourth-quarter operating profit could fall by 35%, as a weak consumer environment for smartphones hurt memory chip sales.

Meanwhile, investors are preparing for data scheduled for Thursday on the path of inflation in December, hoping it will show further deflation in prices. Such a development could pave the way for the Fed to begin interest rate cuts, even as early as the first quarter of 2024. According to CME's FedWatch tool, markets are giving a 58% chance that the Fed will cut interest rates. At least 25 basis points in March.

Atlanta Federal Reserve Bank President Rafael Bostic said Monday that while inflation appears to be on track to return to 2 percent, monetary policy will need to remain accommodative to ensure that goal is achieved.

Indicators – statistics

The Dow Jones Industrial Average fell 164.85 points, or -0.44%, to 37,516.10 points, while the broader S&P 500 index fell 3.67 points, or -0.08%, to 4,759.74 points. The Nasdaq technology index rose 27.26 points, or 0.18%, to 14,870.76 points.

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Of the 30 stocks that make up the Dow Jones Industrial Average, seven are moving with a positive sign and 23 are moving with a negative sign. Merck stock rose $1.23, or 1.05%, to $118.61, and was the biggest gainer, followed by Salesforce stock, up 0.85% to $263.09, and Walmart, up $158.66, with a gain of 0.26%.

Conversely, the biggest losers are the Dow Jones (-2.05%), Chevron (-1.91%), and Walgreens Boots Alliance (-1.72%).

In business news, Juniper Networks shares rose more than 21% after Reuters reported that Hewlett Packard Enterprise Co. It is in advanced talks to acquire the company for $13 billion.

At the end of the week, investors' eyes will be on the quarterly results announcements of banking giants JPMorgan Chase, Wells Fargo, Bank of America and Citigroup, which open the fourth-quarter financial results period.

Later in the day, data released today showed that the trade deficit narrowed 2% in November from the previous month to $63.2 billion, and the average estimate of analysts polled by Bloomberg had put the deficit at $64.9 billion.