Stocks closed higher on Monday, rebounding from a brutal week and setting the stage for a busy period for corporate earnings that investors hope will help put 2024’s rally back on track.
Major Indices
The Dow ended the day up 250 points or 0.7 percent, while the S&P and Nasdaq both closed higher by about 1%, led by tech shares that gained back some ground after last week’s sell-off.
‘Magnificent Seven’
The Magnificent Seven is the nickname given to some of the biggest tech stocks, which taken together have been fueling much of the market’s rally this year: Alphabet (Google), Apple, Amazon, Meta (Facebook), Microsoft, Nvidia and Tesla.
Of those stocks, Nvidia had the best day Monday, rising 4%. The chipmaker and A.I. darling is coming off its worst week since September 2022. The rest of the ‘Seven’ were up more modestly, with the one exception being Tesla, which ended the day down more than 3%.
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Tesla in Spotlight
Tesla shares have been battered of late, down 43% this year on concerns over slowing global demand for electric vehicles and tightening margins as it initiates new price cuts on some of its most popular models. Investors have been selling TSLA into its earnings report, scheduled for Tuesday after the bell. Some analysts are expecting the automaker to post its first ever decline in revenue. Many are hoping for more clarity from CEO Elon Musk over his plans to pivot the company toward so-called “robotaxis” over more affordable entry-level EVs.
Oil
U.S. crude oil slid after developments in the Mideast appeared to signal a de-escalating crisis between Israel and Iran, coming after those two countries traded direct missile strikes. Iran said it did not intend to retaliate after Israel launched limited strikes on its air defenses last week.
Earnings This Week
Along with Tesla, Tuesday will see reports from PepsiCo, Lockheed Martin, Spotify and General Motors, followed by Meta, IBM and Boeing on Wednesday and Intel, Alphabet and Microsoft on Thursday. Oil giants ExxonMobil and Chevron will close the week on Friday with their results.
Other Economic Data
New home sales for March will be released Tuesday, and are likely to show a sluggish market for new mortgages as high interest rates keep buyers on the sidelines as the typically busy spring selling season begins. Rates for the average 30-year-fixed loan are hovering slightly above 7%.
Policymakers will be closely watching the personal consumption expenditures (PCE) price index on Thursday. The PCE, which strips out volatile food and energy costs and is the Fed’s preferred gauge of inflation, is likely to show that prices remained elevated in March.
Uncommon Knowledge
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Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
