Dow Jones Opens Lower as Investors Eye Data, Earnings
U.S. stocks opened in negative territory at the start of the week, with the Dow Jones Industrial Average (DJIA) shedding 0.1%, as cautious investors awaited fresh economic data.
As of 9:34 a.m. in New York, the Dow Jones index was down 0.1% at 17,776.93. The S&P 500 was also down 0.1% at 2,071.89, while the tech heavy NASDAQ Composite fell less than 0.1% to 4,910.46.
Although U.S. stocks have rallied for six of the last seven weeks, some investors are cautious about the second quarter as global growth remains slow, and many developed stock-market shares are trading at record highs.
Federal Reserve Chairwoman Janet Yellen added to that sentiment when she urged caution last week on hiking interest rates, given the risks from global economic conditions.
Data last week indicated strength in the U.S. labor market and a recovery in the manufacturing did not help in changing that sentiment.
Traders expect only one hike this year, Reuters reported, citing the CME Group’s FedWatch program.
Investors will closely assess the Fed minutes from the March meeting, due for release on Wednesday. Attention will also shift to corporate earnings, with Alcoa Inc (NYSE:AA) kicking off the reporting season when it releases first-quarter results next Monday.
Global stocks inched higher on Monday. The Stoxx Europe 600 was up 0.8% halfway through the session. Stocks in Asia ended little changed. Markets in China were closed for a holiday, while Japan’s Nikkei Stock Average slid 0.3%
In commodities, oil futures swung between gains and losses. West Texas Intermediate for May delivery was last trading at $36.72, down 0.2%. Gold fell 0.1% to $1,222.20.
Virgin America Inc (NASDAQ:VA) surged 40% to a record high of $54.65 after striking a deal to bought by Alaska Air Group, Inc. (NYSE:ALK). Alaska Air beat out JetBlue Airways Corporation (NASDAQ:JBLU). The transaction is expected to close by January 1. Shares of Alaska fell five percent to $77.95, while JetBlue dropped 3.4%.
Tesla Motors Inc (NASDAQ:TSLA) advanced four percent to $247.39 as orders for the electric carmaker’s upcoming Model 3 topped 276,000. The $35,000 car is due out late in 2017.
HP Inc. (NYSE:HPQ) was down 0.6% even as the computer maker is expected to roll out an ultra-thin laptop in Paris on Tuesday that will go head-to-head with Apple Inc. (Apple Inc. (NASDAQ:AAPL).
SunEdison Inc (NYSE:SUNE) sank 42% to $0.25. The renewable-energy company is planning to file for bankruptcy protection within weeks, according to The Wall Street Journal. The Maryland Heights, Missouri-based company is in talks with creditors for a loan to fund operations during the bankruptcy filing process, the paper said.
Brocade Communications Systems Inc (NASDAQ:BRCD) tumbled 13% after the network gear maker agreed to buy Ruckus Wireless Inc (NYSE:RKUS) in a cash and stock deal worth about $1.5 billion. RKUS stock soared 32% to $13.28.
General Electric Company (NYSE:GE) slipped 1.3% to $31.52. Bernstein downgraded the conglomerate to “market perform” from “outperform” on a valuation basis after the GE stock soared 27% over the past year.
The Dow Jones index stretched 2016 gains to 2.1% on Friday after reports showed the pace of job creation remained robust and manufacturing activity improved, fostering confidence in the economy. The index is now 3% from an all-time high reached on May 19.