June 2, 2024

Wall Street Market Reaction to Economic Data 🇺🇸

Wall Street saw stocks drop and bonds rise following data indicating a slowdown in economic momentum. Key points include:

  • GDP and Spending: GDP grew at a 1.3% annualized rate in Q1, below the 1.6% estimate, with personal spending also revised down.
  • Market Reactions: The S&P 500 fell to 5,235, led by tech losses, while Nvidia and AMD faced licensing delays for AI shipments to the Middle East. Dell dropped due to unimpressive revenue increases.
  • Yields and Dollar: Treasury two-year yields fell five basis points to 4.92%, and the dollar declined.
  • Expert Insights:
    • Chris Zaccarelli of Independent Advisor Alliance noted the dual impact of the data, suggesting a potential economic slowdown despite the case for lower rates.
    • Fed’s John Williams expects inflation to drop in the year’s second half.
    • Jim Baird of Plante Moran Financial Advisors sees the economy on track for continued growth despite cooling.
  • Corporate Highlights:
    • Salesforce shares dropped significantly due to poor earnings and guidance.
    • Kohl’s reported weak earnings and lowered guidance.
    • Best Buy showed profitability despite sales woes.
    • Boeing faces continued regulatory scrutiny.
  • Looking Ahead: The market eagerly awaits the Fed’s PCE price index release, with potential implications for future rate cuts and economic growth.
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