The stock market rose in early trading, with all eyes on Fed Chairman Jerome Powell’s second day of testimony in Congress.
The Nasdaq composite, S&P 500 and Dow Jones Industrial Average all climbed 0.7% at 10 am ET following an uneven first half-hour of trading. Volume fell on the NYSE and Nasdaq compared with the same time on Wednesday.
Indexes have been in flux this week, as investors watch for signals on monetary policy while trying to spot signs of an economic slowing. So far, the Nasdaq and S&P 500 are holding above last week’s lows as they attempt to rally.
Powell today makes his second appearance in Congress, this time at the House Financial Services Committee. On Wednesday, Powell told a Senate panel that the Fed wants to see concrete evidence that inflation is cooling, and acknowledged that continued rate hikes could result in a recession. Today’s testimony begins at 10 am ET.
PMI Finds Slowing Activity, Slowing Price Pressures
US Stock Market Today Overview
Last Update: 10:12 AM ET 6/23/2022
Shortly after the market’s open, the S&P Global purchasing managers index for June showed a drop to 51.2 in June from 53.6 in May. It was the weakest increase in five months, while a weaker demand led to the first contraction in new orders since July 2020.
The flash PMI report also noted that while costs remain high, the rise in input prices was the slowest since April 2021.
The yield on the 10-year Treasury fell 11 points to 3.04% as a recession basis start to overshadow expectations of higher rates. Yields fell further after the PMI report came out.
Jobless claims eased to 229,000 from 231,000 the previous week, according to the Labor Department. The consensus Econoday forecast was 225,000. The latest numbers remain near record lows and indicate that the labor market remains tight despite concerns of an economic slowdown.
Crude Oil Flat; IBD 50 Index Climbs
The price of US crude oil was nearly flat, at $106.18 per barrel.
Innovator IBD 50 ETF (FFTY) climbed 0.6% in the first 15 minutes of trading.
Funko (FNKO) led with a 7% gap to new highs. JPMorgan Chase upgraded the collectibles maker to overweight from neutral, and lifted the target price to 28 from 25. The stock is clearing resistance around 22.
Harmony Biosciences (HRMY) added 1.6% after the biotech broke out of a cup with handle base Wednesday. Although shares remain in buy range from the 47.21 buy point, investors should avoid stock purchases due to high market risk.
EVs Rise In Stock Market
A rally in Chinese electric vehicles continued. Xpeng (XPEV) jumped 5% and is on pace for its sixth weekly increase in the past seven weeks.
Li Auto (LI), which launched its L9 SUV model, climbed 5.6% and is rising above the Dec. 1 high of 37.45. Nio (NIO) and Tesla (TSLA), which has operations in China, were nearly unchanged in early trading. Citi cut its price target on Nio from 87 to 41.10, reports said.
Chinese Premier Li Keqiang said Wednesday the government will study extending the exemption of purchase tax for EVs and plug-in hybrids beyond the end of the year.
Accenture (ACN) fell nearly 2% in heavy volume after the tech consulting firm missed expectations and gave revenue guidance that was below views. The firm has shut down operations in Russia, and currency exchange rates are impacting the company’s outlook. The stock was just starting to rebound around the 268 level, but sank to a new 52-week low.
In the afternoon trading in Europe, the London FTSE 100 was off 0.6%, the Paris CAC 40 lost 0.4% and the DAX index slid 1.3%. In Asia, the Tokyo Nikkei 225 inched up 0.1%, the Shanghai Composite rallied 1.6% and the Hong Kong Hang Seng rose 1.3%.
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