July 4, 2022

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U.S. Stocks Turning In Mixed Performance As Investors Look For Direction

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U.S. stocks are turning in a mixed performance on Monday with investors largely making cautious moves, weighing the impact of higher interest rates, the Ukraine war and the coronavirus lockdowns in China.

Data showing a contraction in China’s industrial output, and a report showing an unexpected contraction in New York manufacturing activity in May are weighing on sentiment.

The major averages are mixed. While the Dow and the S&P 500 are up in positive territory, while the Nasdaq is weak.

The Dow is up 204.56 points or 0.63 percent at 32,401.22. The S&P 500 is up 7.95 points or 0.2 percent at 4,032.74, while the Nasdaq is down 37.27 points or 0.32 percent at 11,767.72.

Shares of Eli Lilly & Co. are up 3.5 percent after the drugmaker said it has bagged the nod from the regulator for tirzepatide that helps treat adults with type 2 diabetes.

Spirit Airlines shares are up 13.5 percent after JetBlue Airways launched a hostile takeover bid for the discount carrier. JetBlue shares are down by about 4.4 percent.

Chevron is gaining nearly 4 percent. Merck is up 2.5 percent, while Wallgreens Boots Alliance, Verizon, IBM, UnitedHealth, Caterpillar and P&G are up 1 to 2 percent.

Walt Disney, American Express, Boeing and Salesforce.com are down 1 to 1.25 percent. Goldman Sachs, Intel, Cisco Systems, Apple and JP Morgan are also weak.

Data from the National Bureau of Statistics showed that China’s industrial output contracted 2.9 percent year-on-year in April, missing expectations for an increase of 0.4 percent and down from 5 percent in March.

According to a report released by the Federal Reserve Bank of New York, manufacturing activity unexpectedly contracted in the month of May, with the general business conditions index plunging to a negative 11.6 in May from a positive 24.6 in April. A negative reading indicates a contraction in regional manufacturing activity.

Economists had expected the index to slump to a positive 15.5, which would have still indicated growth in the sector.

In overseas trading, Asian stocks ended on a mixed note on Monday after the latest data out of China showed the gloomy impact of the country’s “zero-COVID” policy.

European stocks too turned in a mixed performance with investors digesting the latest batch of economic data from the zone, and reacting to the downward revision in growth forecast for the EU countries.

The European Commission cut its growth forecast for the 19 countries sharing the euro to 2.7 percent this year from 4 percent predicted in February, citing the impact of the Ukraine war and soaring inflation. GDP growth is expected to slow to 2.3 percent next year, below the 2.7 percent seen before, the EC report said.

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2022-05-16 14:29:49

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