Stocks were searching for direction Friday, after the market closed Thursday with a rebound from recent lows.
Shortly after the open, the
Dow Jones Industrial Average
rose 11 points, after having gained more than 100 points in premarket trading. The
dropped 0.4%, and the
was down 1.2%. Both indexes were in the green before the market opened.
The indexes are taking a break from gains after sprinting higher Thursday afternoon. The S&P 500 jumped 1% to Thursday’s close from its low point of the week in afternoon trading. It had fallen 2.8% from its high for the week Tuesday morning. That was when Fed Governor Lael Brainard said the central bank would soon begin reducing the size of its balance sheet. Wednesday’s Fed minutes confirmed that the Fed is indeed likely to reduce its bondholdings by about $ 95 billion per month. The minutes also revealed that the Fed is prepared to soon lift short-term interest rates by a half a percentage point, rather than the standard quarter point, to squelch high inflation.
Federal Reserve policy changes are still a risk markets are grappling with. Interest rates are on the rise, and Wall Street is still trying to size up how much economic and earnings growth could get hit.
There are signs within the stock market that “consensus is embracing the idea that US [economic] growth must slow meaningfully, ”partly a result of the Fed’s tightening of monetary policy, wrote Dennis DeBusschere, founder of 22V Research.
The S&P 500 was showing one of those signs. After rallying near the 4,600 level three times since February, it has failed to rise any further. It’s now trading at just under 4,500.
Technology stocks continued to face the most pressure. That’s because the 10-year Treasury yield has surged to 2.71%, a pandemic-era high. It was at 2.4% just before Brainard’s comments emerged on Tuesday. Higher long-dated bonds make future profits less valuable and many tech companies are valued on the basis that they’ll churn out sizeable profits many years into the future.
One factor that could at least provide some relief, even if that feeling is not showing itself in the market: Russian officials said Friday morning that their military’s operation in Ukraine could end soon, citing ongoing peace talks among other things.
That wasn’t pushing the price of oil down, though it wasn’t exactly surging. WTI crude oil was up 0.1% Friday to just over $ 96 a barrel. That’s down from its multiyear peak of $ 130 hit on March 8, when markets were afraid that Western nations would implement severe sanctions on Russian oil, which would limit global supply. Oil is still up about 8% from its early February level, just before it became clear that Russia was soon to invade Ukraine.
Overseas, European indexes surged after a selloff in the previous session, with London’s
gaining 1%. Tokyo’s
ticked up 0.4%.
Here are five stocks on the move Friday:
After a 15% rise on Thursday,
(ticker: HPX) was down 1.5%. Warren Buffett’s Berkshire Hathaway (BRK.A and BRK.B) recently revealed it had taken a stake in the computer and printer maker.
(STLA) initially rose, then fell 0.4% after the auto maker sold its remaining 25% stake in global logistics group Gefco.
(PSFE) stock was up 13% after the company said Bruce Lowthers would become CEO, succeeding Philip McHugh. The company also reaffirmed its current quarter guidance for earnings before interest, tax and non-cash expenses to come in between $ 95 million and $ 100 million.
(TGT) stock gained 1.6% after getting upgraded to Buy from Hold at Gordon Haskett.
(KR) stock rose 3.9% after getting upgraded to Buy from Neutral at Bank of America.
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