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Stocks mixed, Treasuries up, Oil down, Google shares slump, Gold gains against US dollar dip, Top investment strategist sees stock slump coming, Car companies competing to offer $25,000 EVs, and more financial news.
Stocks were mixed in early trading on Monday, with S&P 500 futures bubbling under at -1.25 points or -0.03%, while Dow futures were up 28 points or +0.08%, and NASDAQ futures were down 8.50 points or -0.06%, as of 6:27 AM EDT, Yahoo Finance reported.
The benchmark 10-Year Treasury was up +0.038 for a yield of 3.56%, while the 2-Year Treasury was up +0.045 for a yield of 4.148%, as of 9:33 AM EDT on Monday.
In oil futures, the benchmark Brent crude was down -0.52% and trading at $85.86 a barrel, while WTI crude was down -0.58%, and trading at $82.04 a barrel, as of 8:34 AM CDT.
Shares of Alphabet Inc., Google’s parent company, were headed for the biggest single-day decline in more than two months following a report that Samsung is considering replacing Google with Microsoft Bing as its default search engine on its devices.
As investors ponder the prospect of another Fed rate hike, gold rose on Monday as the US dollar eased slightly, with spot gold up 0.5 percent at $2012.62 per ounce, while US gold futures rose 0.4 percent to $2024.70, as the dollar index moved to lower 0.1 percent, which made bullion cheaper for overseas buyers, Arab News reported.
Morgan Stanley’s Michael Wilson, a top strategist who was ranked No. 1 in last year’s Institutional Investor survey for correctly predicting the stock slump, wrote in a note that the percentage of stocks outperforming the S&P 500 on a three-month rolling basis is the lowest on record, Yahoo Finance reported. Wilson said this “is the market’s way of warning us we are far from out of the woods with this bear market.” The current S&P 500 rally has been driven by only a handful of stocks, and if bond yields rise, Wilson says, it will put the index at risk of fresh lows.
“If there is one thing that can throw cold water on the large mega-cap rally, it’s higher yields due to a Fed that can’t stop hiking as soon as perhaps some investors are expecting,” Wilson added.
Car companies are competing to bring the cost of electric vehicles down to $25,000. Tesla claims it will cut its manufacturing cost in its next models by 50 percent, while GM is poised to release its electric Equinox SUV at around $30,000 this fall. VW and Fisker are launching new EVs that will come in at 30% or more below average U.S. new-vehicle prices, CNBC reports.
While the new cars will be comfortable, analysts say they will be somewhat bare-bones. Car manufacturers have been looking for ways to slash prices to encourage the public to adopt EVs more quickly, and making a cheaper car in the $25,000-$30,000 range appears to be the mass-market Holy Grail.
