U.S. Stocks Mixed in Early Trading, Nvidia Continues to Decline

stock market

Early trading in the U.S. stock market shows a mixed picture, with Nvidia (NASDAQ: NVDA) continuing its downward trend. The S&P 500 remained flat on Monday, hovering near last week’s record high. The Dow Jones Industrial Average gained 89 points, while the Nasdaq composite fell by 0.1%. Nvidia has been experiencing a pullback since briefly surpassing Microsoft as Wall Street’s most valuable company last week, marking its first losing week in nine weeks. RXO experienced a significant jump of 13.7% after announcing its acquisition of the Coyote Logistics freight brokerage business from UPS. Treasury yields remained stable.

Wall Street Anticipates Gains in a Quiet Week

The stock market was poised to open with gains on Monday, anticipating a relatively quiet week with few major economic releases and notable corporate earnings reports. Futures for the Dow Jones Industrial Average rose 0.3% before the bell, and futures for the S&P 500 increased by 0.1%.

Key Stock Movements and Regulatory Actions

Apple shares remained unchanged following charges from the European Union under its new digital competition rules. The EU accused Apple of preventing app makers from directing users to cheaper alternatives outside its App Store, potentially facing fines up to 10% of its global revenue, which could amount to billions of euros.

Under Armour shares dropped by 1.6% before the bell after the company agreed to settle charges that CEO Kevin Plank misled investors about the company’s performance. While Under Armour denied any wrongdoing, it will pay $434 million to settle the class-action lawsuit brought by investors.

Economic Data and Federal Reserve Actions

This week’s key economic data includes an inflation reading from the government’s consumer spending report scheduled for Friday. The PCE index, the Federal Reserve’s preferred measure of inflation, plays a significant role in the central bank’s interest rate policy decisions. The Fed has raised its benchmark lending rate to slow the economy and bring inflation down to its 2% target without triggering a recession. While most analysts still expect a rate cut this year, the number of anticipated cuts has decreased.

Another important report this week is the Conference Board’s June consumer confidence report, slated for Tuesday.

Corporate Earnings Reports

Companies reporting earnings this week include Carnival Cruise Line, FedEx, Walgreens, and Nike.

Bond Market Movements

In the bond market, U.S. Treasury yields initially fell after a report indicated weaker-than-expected business activity in eurozone countries, raising concerns ahead of a French election. However, U.S. yields rebounded after a subsequent report suggested stronger-than-expected U.S. business activity. According to S&P Global’s preliminary reading, overall output growth reached a 26-month high without increasing inflationary pressure.

European and Asian Markets

In Europe, France’s CAC 40 rose by 0.7%, Germany’s DAX by 0.9%, and Britain’s FTSE 100 by 0.5% at midday. In Asia, Tokyo’s Nikkei 225 increased by 0.5% to 38,804.65, while the yen weakened to 159.49 to the dollar. The Japanese central bank’s minutes indicated that any interest rate changes would depend on clear economic indicators, such as a rebound in the CPI inflation rate. Japanese officials signaled readiness to intervene to support the yen.

Other Asian markets saw declines: Hong Kong’s Hang Seng fell by less than 0.1% to 18,027.71, the Shanghai Composite dropped by 1.2% to 2,963.10, Australia’s S&P/ASX 200 dipped by 0.8% to 7,733.70, and South Korea’s Kospi shed 0.7% to 2,764.73.

Commodity Prices

U.S. benchmark crude oil rose by 33 cents to $81.06 per barrel in electronic trading on the New York Mercantile Exchange, while Brent crude added 39 cents to $84.72 per barrel. The euro rose to $1.0733 from $1.0693.

Market Closing Numbers from Friday

On Friday, the S&P 500 slipped by 0.2% to 5,464.62, remaining close to its all-time high and ending its eighth winning week out of the last nine. The Dow Jones Industrial Average edged up by less than 0.1% to 39,150.33, and the Nasdaq composite dropped by 0.2% to 17,689.36.