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Wall Street Adds to Last Week's Gains 05/06 10:40
.S. stocks are ticking higher Monday as last week's rush of market-moving
events gives way to what could be a quieter week.
NEW YORK (AP) -- U.S. stocks are ticking higher Monday as last week's rush
of market-moving events gives way to what could be a quieter week.
The S&P 500 was up 0.6% in midday trading. The Dow Jones Industrial Average
was up 102 points, or 0.3%, as of 11 a.m. Eastern time, and the Nasdaq
composite was 0.6% higher.
Berkshire Hathaway added 0.5% after Warren Buffett's company reported its
latest quarterly results over the weekend. Freshpet jumped 7.3% after reporting
better results than expected in large part because it sold 30% more food for
cats and dogs.
They helped to offset an 8.9% slide for Spirit Airlines, which reported a
slightly worse loss than expected. The carrier said it's facing increased
competition in many of its markets, particularly between the United States and
Latin America. Apple slipped 0.7% after Buffett pared Berkshire Hathaway's
stake in the tech giant.
The U.S. stock market has been swinging sharply since setting a record at
the end of March. It sunk for weeks on fears that stubbornly high inflation
would prevent or at least delay the Federal Reserve from delivering the cuts to
interest rates that Wall Street craves.
But markets found a burst of optimism at the end of last week following a
cooler-than-expected jobs report. It suggested the U.S. economy could nail the
tightrope walk of staying strong enough to avoid a bad recession, but not so
firm that it puts too much upward pressure on inflation.
Goldman Sachs economist David Mericle said he still expects two cuts to
rates this year, in July and November, after Fed Chair Jerome Powell "pushed
back strongly against the possibility of further rate hikes" at his press
conference last week.
This upcoming week won't include such highly anticipated events as last
week's Fed meeting or monthly jobs report. This week's highlights instead could
come from a number of speeches by Fed officials or from Friday's preliminary
report on consumer sentiment.
The bulk of companies in the S&P 500 have also already reported their
results for the first three months of the year, with more than three-quarters
of them topping profit expectations, according to FactSet.
But several more big names are still on the way this week, including The
Walt Disney Co. and Uber Technologies.
In the bond market, which has been dictating much of the action in the stock
market recently, Treasury yields were holding relatively steady.
The yield on the 10-year Treasury was at 4.50%, where it was late Friday.
The two-year Treasury, which more closely tracks expectations for the Fed, was
also moving little.
Traders are betting on a 90% chance that the Fed will cut its main interest
rate at least once before the end of the year, according to data from CME
Group. That's up from an 81.6% probability seen a week ago.
In stock markets abroad, several exchanges were closed for holidays. Indexes
rose relatively modestly in France, Germany and Hong Kong. Stocks jumped 1.2%
in Shanghai.
Corporate profit reports have been better than expected not just in the
United States but also in Europe and Japan, according to strategists at
Deutsche Bank. Global earnings growth is on track for a second straight quarter
of growth following four consecutive declines.
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