Wall St stocks, dollar gain with data; Fed, earnings in the wings

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S. REUTERS/Brendan McDermid/File Photo

By Sinéad Carew

(Reuters) – The S&P 500 and the Dow were up slightly while the Nasdaq fell and the dollar gained as investors waited for clues on the Federal Reserve’s interest rate path as well as a raft of economic data and quarterly earnings reports.

Crude oil prices were lower as investors waited anxiously for the Fed’s interest rate announcement on Wednesday and commentary on its potential next steps. Also, weaker Chinese manufacturing data outweigh support from OPEC+ supply cuts slated for this month.

U.S. Treasury 10-year yields were higher after falling on Friday with investors eyeing the banking sector and the busy week ahead.

While some overseas markets were closed for the May 1 holiday, U.S. investors were gearing up for earnings reports such as Apple Inc’s, due Thursday, and data including April’s U.S. non-farm payrolls report due out on Friday.

Offering some support was JPMorgan Chase & Co’s deal to buy most of the assets of First Republic Bank after regulators seized the troubled lender, marking the third major U.S. bank failure in two months.

Read More: Wall Street surges, Treasury yields rise as solid earnings offset weak data

“It clears up the most recent bank uncertainty,” said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut. But Pavlik noted that there’s still “good reason to sit back and remain on hold until we get through this week.”

“You’ve a whole stew of data coming out this week. You don’t know if the cioppino is going to be hot, mild or somewhere in between, which is why you have the market hanging around this unchanged level,” said Pavlik.

Still, Monday’s data appeared to give the dollar a boost while the knee-jerk reaction from stocks was less enthusiastic.

The Dow Jones Industrial Average rose 51.23 points, or 0.15%, to 34,149.39, the S&P 500 gained 0.19 points, or 0.00%, to 4,169.67 and the Nasdaq Composite dropped 35.82 points, or 0.29%, to 12,190.76.

The pan-European STOXX 600 index rose 0.02% and MSCI’s gauge of stocks across the globe shed 0.07%. Emerging market stocks lost 0.10%.

U.S. manufacturing pulled off a three-year low in April as new orders improved slightly and employment rebounded, but activity remained depressed amid higher borrowing costs and tight credit.

Also, U.S. construction spending increased more than expected in March, boosted by investment in non-residential structures, but single-family homebuilding remained depressed.

Read More: Wall Street ends sharply lower, Treasury yields slide as recession fears mount

In currencies, the dollar index rose 0.383%, with the euro down 0.45% to $1.097. The Japanese yen weakened 0.78% versus the greenback at 137.35 per dollar, while sterling was last trading at $1.2498, down 0.59% on the day.

In Treasuries, yields on benchmark 10-year notes were up 9.7 basis points to 3.549%, from 3.452% late on Friday. The 30-year bond yield was last up 11.8 basis points at 3.7955%. The yield on the 2-year note was last up 7.3 basis points at 4.1366%.

Weak economic data from China was also in focus with the manufacturing purchasing managers’ index (PMI) declining to 49.2 from 51.9 in March for the world’s second-biggest economy. A score below the 50-point mark separates expansion and contraction in activity.

U.S. crude fell 2.14% to $75.14 per barrel and Brent was at $78.84, down 1.85% on the day.

Gold gave up all of its gains in volatile trading after the better-than-expected U.S. manufacturing data.

Spot gold dropped 0.4% to $1,982.50 an ounce while U.S. gold futures fell 0.18% to $1,986.60 an ounce.

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