February 5, 2023

5 things to know before the stock market opens on Tuesday

5 things to know before the stock market opens on Tuesday

Here are the top news, trends and analysis that investors need to start their trading day:

1. Stock futures jump as investors tackle key inflation report

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, March 29, 2022.

Brendan McDermid | Reuters

Stock futures jumped Tuesday morning as Wall Street Understand the headline inflation report. The day before, all three major US stock indexes fell as the yield on the 10-year Treasury touched a three-year high and heightened concerns about an economic slowdown. The Dow Jones Industrial Average On Monday, it fell 413 points, or 1.19%, while Standard & Poor’s 500 It slipped 1.69%. The Nasdaq Composite – home to many developing stocks more sensitive to high interest rates – down 2.18%.

The tech-heavy Nasdaq is down about 5.7% per month so far. The S&P 500 is down 2.6%, while the benchmark Dow is down nearly 1.1%.

2. The 10-year Treasury yield reaches its highest level since December 2018

The US 10-year Treasury yield was trading at its highest point since December 2018 on Tuesday morning, hitting 2.82% before easing back somewhat to 2.798%. The yield fell to 2.73% after the Labor Department released its March CPI report at 8:30 AM ET.

Treasury yields, which move inversely with prices, have risen rapidly in recent weeks. As recently as March 7, the 10-year US Treasury yield was less than 1.7%. However, yields rose as the bond market approached a more aggressive tightening policy from the Federal Reserve. In March, the US central bank raised interest rates for the first time in more than three years, and a larger increase is expected at its May meeting.

3. The March CPI shows the highest inflation rate since 1981

A person shops for groceries at Lincoln Market on March 10, 2022 in the Prospect Lefferts Garden neighborhood in the Brooklyn neighborhood of New York City.

Michael M. Santiago | Getty Images

Consumer Price Index for the month of March By 8.5% year-on-yearThe Labor Department said Tuesday, the biggest year-over-year jump since December 1981. That’s just above Dow Jones’ estimate of 8.4%. Core CPI, which excludes food and energy, met expectations for a 6.5% rise.

The CPI tracks a wide range of goods and services, and has been running for months at its hottest levels in decades. Fed policy is being tightened in an effort to curb this historically high inflation.

Energy prices rose significantly in the March report, up 11% month over month and 32% year over year. Economists had warned of such a spike due to the surge in oil prices in early March due to the Russo-Ukrainian war. Shelter costs increased 0.5% m/m and 5% y/y.

4. US surveillance allegations of a possible Russian chemical attack in Ukraine

Pentagon Press Secretary John Kirby speaks during a Pentagon news briefing on April 11, 2022 in Arlington, Virginia.

Alex Wong | Getty Images

The United States is monitoring unconfirmed reports of a Possible Russian chemical weapons attack In the Ukrainian port city of Mariupol, Pentagon press secretary John Kirby said Monday night. While Kirby noted that the US had not verified the accounts, he said they were “extremely concerning.” Kirby said in a statement that the unconfirmed reports are also “a reflection of our concerns about Russia’s ability to use a variety of riot control agents, including tear gas mixed with chemical agents, in Ukraine.”

British Foreign Secretary Liz Truss said the UK was working to verify details of the possible attack, which was originally a telegram published by a far-nationalist part of Ukraine’s National Guard called the Azov Regiment. The letter claimed that Russian forces had used a “toxic substance of unknown origin”.

5. Shanghai’s weeks-long lockdown eased for some residents

The city of Shanghai, where many foreign companies are based, entered a two-part lockdown this week as municipal authorities sought to control the outbreak of China’s worst Covid wave in two years.

Hector Ritaml | Afp | Getty Images

Covid lockdowns in Shanghai Relaxed for some residents TuesdayMore than two weeks after strict public health protocols were put in place Corona Virus Infections increased. Nearly 5 million people live in parts of Shanghai where restrictions have been eased because no new cases have been detected in that area for at least two weeks, local media reported. While these residents can leave their homes, Reuters reported There has been some confusion about the extent of the freedom of movement.

Shanghai is the largest city in China, with a population of about 26 million. Concerns about the humanitarian and economic impacts Strict lockdowns have been intensified in recent days. On Monday, the US State Department notified all non-emergency government employees and their family members in Shanghai to leave the city.

open an account now For the CNBC Investing Club to follow Jim Cramer’s every arrow move. Follow the actions of the wider market like a pro CNBC PRO.