Stocks Inch Lower Ahead Of Inflation Data, Gold Takes Breather, Bitcoin's Bull Run Persists: What's Driving Markets Monday?

Wall Street kicked off the new week with a slight dip, failing to stage a recovery following Friday’s closing losses, as investors exercised caution ahead of February’s impending inflation report due on Tuesday.

Around noon trading in New York, all major U.S. stock indices showed declines, with small caps lagging behind their larger counterparts.

In the short end of the Treasury yield curve, yields edged higher, with the 2-year yields — the sensitive barometer to policy changes — rising by 5 basis points to 5.53%. Traders are positioning themselves for a lesser dovish stance from the Fed, given the upcoming Consumer Price Index (CPI) data and next week’s FOMC meeting.

Economists are forecasting stable annual inflation at 3.1% for February, while core inflation is expected to drop to 3.7%.

On the data front, the New York Fed reported unchanged median inflation expectations at 3.0 percent for the one-year horizon. However, expectations rose to 2.7 percent from 2.4 percent for the three-year horizon and to 2.9 percent from 2.5 percent for the five-year horizon.

Meanwhile, market sentiment has slightly dampened expectations of a rate cut by June, now pegging the likelihood at 72%, down from 80% last week.

Gold takes a momentary pause, while Bitcoin continues its meteoric rise, surpassing the $72,000 milestone as U.K. regulators loosen restrictions for exchange-traded products (ETPs).

Monday’s Performance In Major US Indices, ETFs

The SPDR S&P 500 ETF Trust SPY eased 0.1% to $510.79, the SPDR Dow Jones Industrial Average DIA inched 0.1% down to $387.70 and the tech-heavy Invesco QQQ Trust QQQ fell 0.3% to $437.65, according to Benzinga Pro data. 

Sector-wise, the Materials Select Sector SPDR Fund XLB, was the top performer, up by 0.9%, while the Industrials Select Sector SPDR Fund XLI trailed, down by 0.7%. 

Monday’s Stock Movers

• Meta Platforms Inc. META tumbled nearly 4%, after Donald Trump labeled Facebook as an “enemy of the people.”
• Marvell Technology Inc. MRVL fell over 5%, continuing the weak momentum following a disappointing quarterly outlook unveiled on Friday.
• Moderna Inc. MRNA rose 8.7%, while EQT Corp. EQT fell over 5% as they announced to reduce costs and give it more control delivering its gas to markets. Analysts note that EQT is inheriting roughly $6 billion of debt in the all-stock deal at a time when natural gas prices are as low as they’ve been in decades
• Asana, Inc. ASAN, Casey’s General Stores, Inc. CASY, Oracle Corp. ORCL and Vail Resorts, Inc. MTN are among the notable companies reporting quarterly results after the market close.

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