U.S. Stocks Mostly Lower Following Long Easter Weekend

(RTTNews) - Stocks failed to sustain an early advance and have moved mostly lower over the course of the trading session on Monday. The major averages have all moved to the downside, with the Dow and the S&P 500 pulling back off last Friday's record closing highs.

Currently, the major averages are all in negative territory. The Dow is down 269.78 points or 0.7 percent at 39,537.59, the S&P 500 is down 17.30 points or 0.3 percent at 5,237.05 and the Nasdaq is down 16.37 points or 0.1 percent at 16,363.09.

The early strength on Wall Street came as traders finally had an opportunity to react to last Friday's closely watched U.S. consumer price inflation data, which largely came in line with expectations.

The Commerce Department report said the annual rate of consumer price growth ticked up to 2.5 percent in February from 2.4 percent in January, in line with estimates.

Meanwhile, the annual rate of growth by core consumer prices, which exclude food and energy prices, slowed to 2.8 percent in February from an upwardly revised 2.9 percent in January.

Economists had expected the pace of core price growth to come in unchanged compared to the 2.8 percent originally reported for the previous month.

The readings on inflation, which are said to be preferred by the Federal Reserve, were included in the Commerce Department's report on personal income and spending in February.

Buying interest remained somewhat subdued, however, as traders expressed uncertainty about whether inflation is slowing quickly enough to guarantee the interest rate cuts expected by the Fed.

The subsequent pullback by stocks came as a report from the Institute for Supply Management unexpectedly showing modest growth in U.S. manufacturing activity in the month of March contributed to a jump by Treasury yields.

The ISM said its manufacturing PMI jumped to 50.3 in March from 47.8 in February, with a reading above 50 indicating growth in the sector. Economists had expected the index to inch up to 48.4.

With the much bigger than expected increase, the index returned to expansion territory for the first time since September 2022.

Sector News

Telecom stocks have shown a significant move to the downside on the day, dragging the NYSE Arca North American Telecom Index down by 1.7 percent to a five-month intraday high.

Shares of AT&T (T) have fallen by 1.0 percent after the telecom giant said it has determined a data set released on the dark web approximately two weeks ago impacted approximately 7.6 million current AT&T account holders and approximately 65.4 million former account holders.

Interest rate-sensitive commercial real estate stocks are also seeing considerable weakness, with the Dow Jones U.S. Real Estate Index sliding by 1.6 percent.

Housing, brokerage and transportation stocks have also shown notable moves to the downside, while strength remains visible among gold, computer hardware and semiconductor stocks.

Among semiconductor stocks, Micron Technology (MU) has surged by 5.5 percent after Bank of America raised its price target on the company's stock to $144 per share from $120 per share.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Monday, with several major markets closed for holidays. Japan's Nikkei 255 Index tumbled by 1.4 percent, while China's Shanghai Composite Index jumped by 1.2 percent.

Meanwhile, the major European markets were all closed on the day for Easter Monday.

In the bond market, treasuries have moved sharply lower in reaction to the latest U.S. economic data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 11.9 basis points at 4.325 percent.