Day: October 1, 2024

After ending yesterday’s choppy trading session mostly higher, stocks may show a lack of direction in early trading on Tuesday. The major index futures are currently pointing to a roughly flat open for the markets, with the S&P 500 futures down by less than a tenth of a percent.

Uncertainty about the near-term outlook for the markets may keep some traders on the sidelines following a strong September, which is historically a weak month for stocks.

Traders may also be reluctant to make significant moves in early trading ahead of the release of the Institute for Supply Management’s report on manufacturing activity in the month of September.

The report, which is due to be released shortly after the start of trading, is expected to show the ISM’s manufacturing PMI inched up to 47.5 in September from 47.2 in August. A reading below 50 would still indicate contraction.

The Labor Department is also due to release its report on job openings in the month of August. Job openings in August are expected to come in unchanged from July at 7.67 million.

Later in the week, the Labor Department’s closely watched monthly jobs report is likely to be in the spotlight, as traders look for additional clues about the outlook for the economy and interest rates.

Economists currently expect the report to show employment rose by 140,000 jobs in September after climbing by 142,000 jobs in August, while the unemployment rate is expected to hold at 4.2 percent.

Stocks showed a lack of direction over the course of the trading session on Monday before eventually ending the day mostly higher. The major averages all finished the day in positive territory following the mixed performance seen last Friday.

The Dow inched up 17.15 points or less than a tenth of a percent to a new record closing high of 42,330.15, while the Nasdaq climbed 69.58 points or 0.4 percent to 18,189.17. The S&P 500 also rose 24.31 points or 0.4 percent to a new record closing high of 5,762.48.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Tuesday, with several major markets closed for holidays. Japan’s Nikkei 225 Index jumped by 1.9 percent, while Australia’s S&P/ASX 200 Index slid by 0.7 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the French CAC 40 Index is up by 0.1 percent, the German DAX Index and the U.K.’s FTSE 100 Index are both up by 0.6 percent.

In commodities trading, crude oil futures are sliding $0.83 to $67.34 a barrel after edging down $0.01 to $68.17 a barrel on Monday. Meanwhile, after slipping $8.70 to $2,659.40 an ounce in the previous session, gold futures are climbing $17.40 to $2,676.80 an ounce.

On the currency front, the U.S. dollar is trading at 143.74 yen compared to the 143.63 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1074 compared to yesterday’s $1.1135.

Stocks have moved sharply lower during trading on Tuesday, giving back ground after ending the previous session mostly higher. The major averages have all moved to the downside, with the Dow and the S&P 500 pulling back off yesterday’s record closing highs.

Currently, the major averages are off their lows of the session but still firmly negative. The Dow is down 246.18 points or 0.6 percent at 42,083.97, the Nasdaq is down 302.90 points or 1.7 percent at 17,886.27 and the S&P 500 is down 59.77 points or 1.0 percent at 5,702.72.

The sell-off on Wall Street comes amid concerns about escalating tensions in the Middle East after a senior White House official said the U.S. has indications Iran is preparing to imminently launch a ballistic missile attack against Israel.

“We are actively supporting defensive preparations to defend Israel against this attack. A direct military attack from Iran against Israel will carry severe consequences for Iran,” the official said in a statement.

The threat of a direct attack by Iran comes after Israel launched ground operations against the Iranian-backed militia group Hezbollah in southern Lebanon.

The price of crude oil has moved sharply higher on the heels of the news, with crude for November delivery spiking $2.01 or 3.0 percent to $70.18 a barrel.

Concerns about the economic impact of a strike by dockworkers at seaports across the U.S. East and Gulf Coasts may also be weighing on Wall Street.

Around 45,000 dockworkers went on strike after the United States Maritime Alliance and the International Longshoremen’s Association failed to reach a settlement on a new Master Contract.

The ILA union members hit the picket line at midnight after they rejected a wage package offered by the Ocean Carriers, represented by USMX, saying that it was unacceptable.

Sector News

Semiconductor stocks are turning in some of the market’s worst performances on the day, resulting in a 2.5 percent plunge by the Philadelphia Semiconductor Index.

Considerable weakness has also emerged among computer hardware stocks, as reflected by the 2.4 percent slump by the NYSE Arca Computer Hardware Index.

Banking stocks have also shown a significant move to the downside on the day, dragging the KBW Bank Index down by 2.0 percent.

Networking and software stocks have also come under pressure, contributing to the steep drop by the tech-heavy Nasdaq.

Airline and telecom stocks are also seeing notable weakness, while energy stocks are bucking the downtrend amid the sharp increase by the price of crude oil.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Tuesday, with several major markets closed for holidays. Japan’s Nikkei 225 Index jumped by 1.9 percent, while Australia’s S&P/ASX 200 Index slid by 0.7 percent.

The major European markets have also turned mixed after seeing early strength. While the U.K.’s FTSE 100 Index is up by 0.2 percent, the German DAX Index is down by 0.8 percent and the French CAC 40 Index is down by 1.0 percent.

In the bond market, treasuries have moved sharply higher amid concerns about escalating tensions in the Middle East. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 8.4 basis points at 3.718 percent.