Here are the most important news, trends and analysis that investors need to start their trading day:
U.S. stock futures fell Monday after Friday's strong rally. However, Friday's gains of more than 1% for the Dow Jones Industrial Average and S&P 500 and over 2% for the Nasdaq were not enough to make up for sharp declines earlier last week. The Dow and S&P 500 saw weekly declines more than 1% each, while the Nasdaq sank over 2% in its worst weekly performances since February. The roller-coaster ride on inflation worries hit stocks early last week, with the Dow dropping 3.4%, the S&P 500 falling 4% and the Nasdaq plunging 5%. All three stock benchmarks made up some of those losses Thursday and Friday.
Bond yields were mostly lower Monday after the 10-year Treasury yield jumped to over 1.7% on Wednesday during the worst of last week's stock selling. That was the highest 10-year yield level in more than a month, following a run of 14-month highs in March. Inflation fears and whether the Federal Reserve will be able hold the line as promised on near 0% interest rates and massive asset purchases rattled markets. On Wednesday, the government reported that consumer prices in April accelerated at its fastest pace in more than 12 years as the U.S. economic recovery kicked into gear. The Fed releases minutes from its April meeting this Wednesday.
AT&T on Monday announced a deal to combine its WarnerMedia movie and media content unit with Discovery, paving the way for one of Hollywood's biggest power players to better compete with streaming media giants like Netflix and Disney. Shares of AT&T gained about 2% and Discovery soared roughly 10%. AT&T shareholders would own 71% of the new company. Discovery shareholders would own 29%. The transaction would put together such properties as WarnerMedia's CNN, HBO and Warner Bros., and Discovery's HGTV, TLC and History channel. In 2018, AT&T acquired Time Warner, since renamed to WarnerMedia, for $85 billion in equity value.
Bitcoin on Monday saw a partial recovery, trading above $45,000 per unit. The price of the world's biggest cryptocurrency fell below that level Sunday after Musk seemingly implied in a Twitter exchange that Tesla sold or may sell the rest of its bitcoin holdings. He responded "indeed" to a sympathetic tweet.
All this came days after Musk said Tesla planned to hold its bitcoin, even though it halted use for electric car purchases until bitcoin mining operations can become more energy sustainable.
CDC Director Dr. Rochelle Walensky called for people to be honest and ditch their Covid masks only if they are fully vaccinated. The sudden change in CDC guidance last week left some people confused as it does not lift local mask ordinances. Local governments and businesses are grappling with whether to follow the CDC's new guidance. Starbucks said, "Facial coverings will be optional for vaccinated customers beginning Monday, May 17, unless local regulations require them by law." Walmart and Costco led the way Friday. Target joined as well.