Stock Market News for June 3, 2024

Market News

U.S. stocks closed mixed on Friday as market participants digested a series of mixed economic data, which led to heightened speculation about interest rate cuts. The Dow and the S&P 500 ended in positive territory, while the Nasdaq Composite finished in red. For the week, these three stock indexes closed in the negative zone.

How Did the Benchmarks Perform?

The Dow Jones Industrial Average (DJI) rose 1.5% or 574.84 points to close at 38,686.32. Notably, two components of the 30-stock index ended in negative territory, while 28 finished in positive zone. The major loser of the blue-chip index was Salesforce, Inc. CRM, after advancing 7.5%. Salesforce currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The tech-heavy Nasdaq lost 2.06 points or 0.01% to close at 16,735.02.

The S&P 500 gained 0.8% or 42.03 points to end at 5,277.51. Among the 11 broad sectors of the benchmark, seven ended in positive territory. The Energy Select Sector SPDR (XLE), the Real Estate Select Sector SPDR (XLRE), the Industrials Select Sector SPDR (XLI) and the Utilities Select Sector SPDR (XLU) rose 2.5%, 2%, 1.2% and 1.8%, respectively.

The fear-gauge CBOE Volatility Index (VIX) was down 10.7% to 12.92. The S&P 500 posted 19 new 52-week highs and six new 52-week lows. Advancers outnumbered decliners on the NYSE by a 1.51-to-1 ratio. On the Nasdaq, a 1.41-to-1 ratio favored advancing issues. The Nasdaq Composite registered 55 new 52-week highs and 100 new 52-week lows.

Stable April PCE Data Spurs Rate Cut Speculation

The recent data released by the Commerce Department on the Personal Consumption Expenditures (PCE) Price Index for April provided insight into inflation trends and consumer behavior, sparking speculation about when interest rates might be cut in the future.

The Department of Commerce reported that the PCE price index increased 0.3% month over month in April, in line with the consensus estimate and March’s data. PCE inflation increased 2.7% year over year in April but came in line with the consensus estimate and the March data.

The Fed’s preferred inflation gauge, the core PCE index, which strips out the volatile food and energy prices, rose 2.8% year over year in April, in line with expectations. The core PCE index rose 0.2% month over month in April, less than analysts’ expectations of an increase of 0.3%.

The Federal Reserve signaled that it will need to see favorable economic data before considering any changes to interest rates. As per the CME Group's FedWatch tool, the probability of a rate cut in September increased to 53.2%.

Economic Data

Personal consumption expenditure increased 0.2% month over month in April compared with the consensus estimate of 0.3% and a 0.7% increase in March. Personal income in April increased by 0.3% month over month, in line with the consensus estimate and slightly below the 0.5% increase in March. The personal savings rate increased to 3.6% in April. In March, the rate was revised upward from 3.2% to 3.6%.

Weekly Roundup

The S&P 500 and the Nasdaq snapped their five-week win streaks, slipping 0.5% and 1.1%, respectively. The blue-chip Dow slid 0.9%, marking its second straight week of losses.

Monthly Roundup

During the month, the S&P 500 rose 4.8%, the Nasdaq jumped 6.9% and the Dow climbed 2.4%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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