Stocks closed the day mixed after the beginning of today’s session gave investors a minor scare. What started off as a continuation of the prior week’s selloff due to AI-related fears ended up stabilizing after private software companies like McAfee and Rocket Software released their earnings ahead of schedule to convince lenders of their resilience to AI-driven disruption. All major U.S. stock indices ended the day effectively unchanged.
The Dow Jones Industrial Average rose 32 points to 49,533. The NASDAQ slipped 0.13% to 24,702. The S&P 500 gained 0.1% to 6,843. Rate-sensitive sectors posted gains today as yields dropped significantly over the past week. These included financials, real estate, and industrials; all other sectors ended the day in the red.
U.S. benchmark interest rates rose slightly. The U.S. 5-year Treasury yield increased nearly 2 basis points to 3.63%, and the 10-year yield rose nearly 1 basis point to 4.06%.
Assets that were heavily driven by liquidity over the past year continued to slide. This included Bitcoin and gold, which lost 1.46% and 2.95%, respectively.
Let’s examine the economic data. Today, the Empire State Manufacturing Survey and the Homebuilder Confidence Index came in lower than expected. Although we were presented with data showing a much stronger labor market last week, we are reminded that the economy is still at a crossroads.
Tomorrow, we will have additional gauges of the economy, especially in the real estate sector. More importantly, we will see the release of the Federal Reserve’s January rate-setting meeting minutes, which could inform the future trajectory of U.S. monetary policy.
This is Adams Wealth Advisors, and thank you for listening.