The stock market was indeed open for Columbus Day, but it certainly didn’t do much. Stocks were mixed for most of Monday in the middle of a day of slow news without significant economic data.
U.S. crude oil prices hit $ 84.60 a barrel at one point – their highest price since late 2014 – before settling at $ 83.78, up 2.0%. Although the rise in crude prices has helped oil stocks such as Halliburton (HAL, + 3.1%) and Schlumberger (SLB, + 2.5%), the energy sector ends up at 0.4% in the red.
An afternoon swoon sent the Dow Jones Industrial Average 0.7% less at 34,496. S&P 500 declined 0.7% to 4,361, and the Nasdaq Composite slipped 0.6% to 14,486.
Potentially spice things up later this week: the start of the third quarter earnings season, including reports from JPMorgan Chase (JPM), Delta Airlines (DAL) and UnitedHealth Group (A H). FactSet senior earnings analyst John Butters said the S&P 500 is expected to post profit growth of 27.6% year-over-year.
“We believe earnings growth will be strong again this quarter,” added Jeffrey Buchbinder, financial equity strategist at LPL. “But those looking for massive upside surprises and sharp increases in estimates will likely be disappointed. COVID-related supply chain disruptions and labor and material shortages have held back some US companies these days. last months.”
“Beyond these widely reported supply chain challenges facing US businesses, there are other reasons to expect this quarter’s results to be closer to expectations,” he continues. . “The latest batch of pre-announcements from companies has been less positive than in recent quarters, and estimates have stopped rising.”
Other stock market news today:
- Small cap Russel 2000 was down 0.6% to 2,220.
- Southwest Airlines Shares (LUV, -4.2%) fell on Monday as the carrier was forced to cancel more than 2,000 flights since Saturday amid a host of problems. Southwest cited air traffic control issues and adverse weather conditions. However, its pilots’ union said in a statement that “(Southwest Airlines) claimed the immediate causes of this weekend’s collapse were personnel at Jacksonville Center and the weather in the southeastern United States. , but what was a minor temporary event for other carriers devastated Southwest Airlines as our operation became fragile and prone to massive failures at the slightest pressure. ” Now LUV is planning to make further cuts to a fall flight program that it has already cut back.
- Gold Futures settled with a modest decline of 0.1% to $ 1,755.70.
- The CBOE Volatility Index (VIX) climbed 6.8% to 20.05.
- Bitcoin prices reversed the trend of stocks, climbing 5.2% to $ 57,494.47. (Bitcoin trades 24 hours a day; the prices listed here are at 4 p.m. each trading day.)
Don’t look away from Washington
One thing we will probably hear less about in the coming days: the debt ceiling.
Last week, the Senate approved an interim bill that will effectively push the issue back to December, with the House due to vote on the measure on Tuesday. As a result, Democrats should be able to focus on one of their top priorities.
“Democrats have yet to unite behind their multibillion-dollar spending plans on infrastructure, social policy and climate change,” [but] the temporary increase in the debt ceiling will likely allow the Democratic Party to focus on rallying its members in Congress around spending plans – key legislative priorities ahead of the 2022 midterm elections, “write analysts in the BlackRock Investment Institute.
While BII notes that “the $ 3.5 trillion price tag for the social policy and climate change bill is being reduced to help secure moderate party support,” any progress in this direction is likely to add more fuel to green energy and electric vehicles. rooms.
Investors are also undoubtedly awaiting a positive conclusion from the negotiations on the infrastructure bill, which have been in turmoil for months. But if congressional momentum picks up once again, expect the market to once again revert to infrastructure trading – which investors can access through a few exchange-traded funds (ETFs), as well as these 14 well-positioned actions.