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Stocks were mixed on Tuesday, with investors awaiting more corporate earnings results from major companies and a Federal Reserve monetary policy decision on Wednesday.
The S&P 500 reversed earlier gains to trade lower after the blue-chip index rose to an all-time high during Monday's regular trading day. The Dow ticked up, while the Nasdaq also slipped. Shares of Tesla (TSLA) fell after the company's first-quarter sales results missed estimates, though earnings and automobile gross margins exceeded expectations in the report delivered Monday evening.
Earnings results will pick up on Tuesday with companies including Microsoft (MSFT), Alphabet (GOOGL) and Starbucks (SBUX) poised to report results. The Big Tech names reporting Tuesday and later this week especially are set to be closely watched, with these stocks having largely underperformed against the broader market for the year-to-date as 2020's tech and growth-led rally cooled and investors turned instead to cyclical and value shares.
"Except for Google, you get the FAANG stocks, and they've been dead money for 7, 8, 9 months now," Matt Maley, managing director and chief market strategist at Miller Tabak, told Yahoo Finance on Monday. "We're seeing Facebook trying to break out, Amazon finally trying to get to the top end of its range, Netflix last week couldn't break out, so that was a disappointment. So if those things could finally pick up, that would be positive [for stocks]."
Tuesday will also mark the first of the Federal Reserve's two-day rate-setting meeting, with the event ultimately unlikely to yield any major shifts in monetary policy. Officials have telegraphed their commitment to keeping policy highly accommodative during the recovery out of the pandemic, which to date has included keeping interest rates close to zero and maintaining an aggressive asset purchase program at a monthly rate of $120 billion.
"The Fed has been very clear that this time around they're going to wait to see inflation before they reaction." Kelsey Berro, JPMorgan Asset Management Fixed Income Portfolio Manager, told Yahoo Finance. "In the past, they've relied on their forecasts, and their forecasts really haven't done a good job. Inflation has consistently missed the mark over the past couple decades. And this time around, they're doing a different approach. They're going to wait and see the data before they react."
4:04 p.m. ET: Stocks end mixed, S&P 500 drifts just below record high ahead of earnings onslaught, Fed decision
Here were the main moves in markets as of 4:04 p.m. ET:
S&P 500 (^GSPC): -0.94 (-0.02%) to 4,186.68
Dow (^DJI): +2.90 (+0.01%) to 33,984.47
Nasdaq (^IXIC): -48.56 (-0.34%) to 14,090.22
Crude (CL=F): +$1.32 (+2.13%) to $63.23 a barrel
Gold (GC=F): -$4.50 (-0.25%) to $1,775.60 per ounce
10-year Treasury (^TNX): +5.2 bps to yield 1.6220%
2:41 p.m. ET: The Fed continues to be the 'main directional driver for equities': Strategist
The Federal Reserve, in keeping interest rates near zero and maintaining its asset purchase program at the current pace, remains a key supporter of equity prices, even though Wednesday's monetary policy decision and remarks from Federal Reserve Chair Jerome Powell will likely yield little news.
“The main directional driver for equities is the fact that the Fed continues to pump money into the market,” Interactive Brokers' Steve Sosnick told Yahoo Finance on Tuesday. "I don't mean to be that simplistic, but until or unless the Fed tells us otherwise, which they could tomorrow but it's unlikely, that that is what's putting a floor under things and that's what's providing the ammunition so to speak for the market rally that we're seeing."
"Bottom line is, as long as the Fed stays supportive, we're still getting the fiscal support working its way through the system, any further stimulus is probably less likely to be a free lunch so to speak because there will be taxes most likely associated with it. But as of now, the Fed is providing the tailwind that the market is enjoying."
10:15 a.m. ET: Consumer confidence raced to a 14-month high in April: Conference Board
Consumer confidence surged far more than expected in April, as a faster-than-expected U.S. vaccination program and easing social distancing standards helped boost Americans' outlooks on the economy.
The Conference Board's monthly consumer confidence index jumped to a reading of 121.7 in April, or well above the 113.0 expected, according to Bloomberg data. The prior month's index was downwardly revised to 109.0, from the 109.7 previously reported.
“Consumers’ assessment of current conditions improved significantly in April, suggesting the economic recovery strengthened further in early Q2," Lynn Franco, senior director of economic indicators at the Conference Board, said in a press statement Tuesday. "Consumers’ optimism about the short-term outlook held steady this month. Consumers were more upbeat about their income prospects, perhaps due to the improving job market and the recent round of stimulus checks. Short-term inflation expectations held steady in April, but remain elevated. Vacation intentions posted a healthy increase, likely boosted by the accelerating vaccine rollout and further loosening of pandemic restrictions.”
9:30 a.m. ET: Stocks drift sideways as investors await Big Tech earnings
Here's where markets were trading after the opening bell Tuesday morning:
S&P 500 (^GSPC): +2.32 points (+0.06%) to 4,189.94
Dow (^DJI): -50.25 points (-0.15%) to 33,931.32
Nasdaq (^IXIC): +20.11 points (+0.14%) to 14,157.57
Crude (CL=F): +$0.32 (+0.52%) to $62.23 a barrel
Gold (GC=F): +$3.80 (+0.21%) to $1,783.90 per ounce
10-year Treasury (^TNX): +2.2 bps to yield 1.592%
9:02 a.m. ET: Home price growth accelerated further in February, with prices growing by the most since 2005
Home price growth advanced further in February as tight inventory and still-strong demand weighed further on home affordability.
The S&P CoreLogic Case-Shiller National Home Price Index accelerated at a 11.97% year-over-year rate in February, according to a new report Tuesday morning. This marked the fastest pace since 2005, and accelerated from January's 11.22% increase.
The 20-City Composite Index, which tracks home price changes in the largest U.S. metropolitan areas, grew 11.94% year-over-year, or faster than the 11.80% rise expected, according to Bloomberg composite data.
7:26 a.m. ET: UPS shares jump after Q1 results easily exceed estimates, with vaccine-led recovery helping buoy international and business shipping
Shares of UPS (UPS) jumped more than 6.5% Tuesday morning after the shipping giant posted Q1 results that easily exceeded estimates, with a resurgence in international shipping volumes and extended strength in domestic parcel deliveries helping boost results.
First-quarter revenue grew 27% to $22.91 billion, coming in well above the $20.60 billion expected. U.S. package revenue jumped 22%, while international package revenue jumped 36%. Supply chain and freight revenue rose 34%, underscoring the pick-up in corporate activity as the economy broadly reopens.
“I want to thank all UPSers for delivering what matters, including COVID-19 vaccines,” UPS CEO Carol Tomé said in a press statement. “During the quarter, we continued to execute our strategy under the better not bigger framework, which enabled us to win the best opportunities in the market and drove record financial results.”
7:17 a.m. ET Tuesday: Stock futures extend overnight gains
Here's where markets were trading ahead of the opening bell Tuesday morning:
S&P 500 futures (ES=F): 4,184.25, up 4.75 points or 0.11%
Dow futures (YM=F): 33,891.00, up 14 points or 0.04%
Nasdaq futures (NQ=F): 14,034.50, up 23 points or 0.16%
Crude (CL=F): +$0.42 (+0.68%) to $62.33 a barrel
Gold (GC=F): +$2.00 (+0.11%) to $1,782.10 per ounce
10-year Treasury (^TNX): +1.3 bps to yield 1.583%
7:01 a.m. ET Monday: Stock futures edge higher
Here's where markets were trading late Monday:
S&P 500 futures (ES=F): 4,179.75, up 0.25 points or 0.01%
Dow futures (YM=F): 33,873.00, down 5 points or 0.01%
Nasdaq futures (NQ=F): 14,016.00, up 4.5 points or 0.03%
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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