Dow closes lower for a third day as stocks' second-quarter woes continue: Live updates

Alex Harring
Sarah Min
Traders work on the floor at the New York Stock Exchange on March 5, 2024.

The Dow Jones Industrial Average ended Wednesday modestly lower as stocks struggled to shake off their second-quarter malaise.

The 30-stock Dow fell 43.10 points, or 0.11%, to close at 39,127.14, marking its third straight negative day. The S&P 500 inched higher by 0.11% to finish at 5,211.49 for its first winning session of the week. The Nasdaq Composite traded up by 0.23%, ending at 16,277.46.

The Dow was hurt by a decline of more than 8% in Intel after the company posted operating losses in its semiconductor manufacturing business. Artificial intelligence darling Nvidia swung into the red despite trading higher for much of Wednesday, also restricting gains for the market. But several megacap technology stocks offered the market some support, with Netflix rising 2.6% and Meta Platforms advancing roughly 1.9%.

Higher rates continued to weigh on stocks. ADP data released Wednesday showed private payrolls grew more than expected in March. It offered another sign of resiliency in the economy as investors grow increasingly concerned about the path of interest rate cuts from the Federal Reserve.

Fed officials also threw cold water on the possibility of rates coming down sooner rather than later. Atlanta Fed President Raphael Bostic told CNBC Wednesday morning he only sees one move lower this year, sometime in the fourth quarter. Fed Chair Jerome Powell said in the afternoon that the central bank needs more evidence of easing inflation before lowering the cost of borrowing money.

Traders see a nearly 99% likelihood that rates remain unchanged at the Fed's May policy meeting, according to the CME FedWatch Tool as of Wednesday afternoon. Fed funds futures trading data suggests a 62.3% probability of a cut at the June gathering, a significant decline from the 70.1% figure seen a week ago.

The rate on the U.S. Treasury 10-year note briefly touched its highest level since November. Oil surged to its most expensive prices going back to October.

Some market observers remain optimistic overall despite the rough start to the quarter, saying stocks are due for some consolidation. The first quarter, which concluded last week, was the best for the S&P 500 since 2019.

"The invincible stock market of the past five months is the exception, not the norm," said Yung-Yu Ma, chief investment officer at BMO Wealth Management.

"It's certainly possible that the goldilocks narrative of high growth and falling inflation could return within a couple of months," Ma said. "But it's also possible to have choppier markets that take time to digest its recent gains and allow fundamentals to catch up with valuations."

Wed, Apr 3 2024 4:03 PM EDT

Dow closes lower for a third day

The Dow finished its third session in a row in the red.

The blue-chip average finished Wednesday down about 0.1%. It has ended every session this week with losses.

On the other hand, the S&P 500 and Nasdaq Composite closed higher by about 0.1% and 0.2%, respectively. Wednesday marked the first positive session this week for the S&P 500.

All three indexes remained on track to end the week with losses.

— Alex Harring

Wed, Apr 3 2024 3:48 PM EDT

Ark Invest's Wood views Reddit as a long-term AI play

Despite its long-term AI potential, Cathie Wood is holding off on buying more Reddit shares right now.

Read more on Wood's outlook for the recent social media IPO here.

— Samantha Subin

Wed, Apr 3 2024 3:39 PM EDT

HSBC sees signs of broadening equity rally

The equity starting October 2023 was initially led by mega-cap tech stocks. However, HSBC Global Research says March's performance indicates the gains may be diversifying.

"Over the past month, the S&P on an equal weighted basis outperformed the overall index, suggesting a broadening of the equity rally, which we expect to widen further as a soft landing materializes," strategist Nicole Inui wrote in a Tuesday note.

Inui noted that market expectations for the Federal Reserve to cut interest rates in June have dropped to 56% from 69% following the FOMC meeting.

— Hakyung Kim

Wed, Apr 3 2024 3:28 PM EDT

30 stocks in the S&P 500 hit new 52-week highs

30 stocks in the S&P 500 hit new 52-week highs during Wednesday's trading session.

Here are a few of the names that hit this milestone:

  • Domino's Pizza trading at levels not seen since Jan, 2022
  • Kinder Morgan trading at levels not seen since Feb, 2023
  • Progressive trading at all-time highs back to its IPO in 1971
  • Caterpillar trading at all-time high levels back to when it first began trading on the NYSE in 1929
  • 3M trading at levels not seen since Feb, 2023
  • Marathon Petroleum trading at all-time highs back to its spinoff from Marathon Oil in June, 2011
  • Diamondback Energy trading at all-time highs back to its IPO in Oct, 2012
  • Dow Inc trading at levels not seen since Feb, 2023
  • Micron trading at all-time highs back to IPO in June, 1984

— Lisa Kailai Han, Christopher Hayes

Wed, Apr 3 2024 3:12 PM EDT

Oil holds to gains as market monitors OPEC+ policy, geopolitical tensions

Crude oil futures on Wednesday clung to recent gains as mounting geopolitical tensions and OPEC+ policy lift prices.

The West Texas Intermediate contract for May delivery gained 28 cents, or 0.33%, to settle at $85.43 a barrel. The Brent contract for June delivery added 43 cents, or 0.48%, to settle at $89.35 a barrel.

Crude futures are at their highest level since late October. U.S. crude is up 20% this year and the global benchmark has gained 16%.

Ukrainian drone strikes on Russian oil refineries and mounting tensions between Israel and Iran have sparked renewed concerns about threats to global crude and fuel supplies.

Prices are also finding support from members of OPEC+ who are voluntarily cutting 2.2 million barrels per day of production. An OPEC+ committee did not recommend any changes to the group's production policy at a closely watched meeting Wednesday.

— Spencer Kimball

Wed, Apr 3 2024 3:01 PM EDT

S&P 500 poised finish higher

The S&P 500 was on track to finish its first session of the week higher as Wednesday's final trading hour kicked off.

The broad index added 0.2% shortly after 3 p.m. ET, regaining some ground after ending the past two days in the red. The Nasdaq Composite climbed around 0.4%, while the Dow traded near flat.

With those moves, all three major indexes were on track to end the week lower.

— Alex Harring

Wed, Apr 3 2024 2:43 PM EDT

Oil price rally could make the Fed's job more difficult, Bank of America says

The rally in crude oil prices could make it more difficult for the Federal Reserve to cut interest rates later this year though the central bank should still have room to maneuver, according to to Bank of America.

U.S. crude oil future prices have risen nearly 20% this year as demand grows, global inventories fall, geopolitical tensions mount and OPEC+ slashes production.

"With services inflation appearing particularly sticky, an oil price run may further cap the ability of central banks to provide stimulus," Francisco Blanch, a commodities strategist at Bank of America, told clients on Wednesday. "So, oil is fighting the Fed, again," Blanch wrote.

Energy prices are expected to rise heading into the summer driving season as the global market slips into a crude oil supply deficit of 450,000 barrels per day, according to Blanch. Bank of America is forecasting that Brent will peak at $95 a barrel. The global benchmark is currently trading above $89.

Rising fuel prices contribute to headline inflation, though gas prices would have to hit $5 to $6 per gallon for the impact to be felt, according to Blanch. This should provide room for the Fed to cut rates in the coming months, he said. Energy prices are not highly correlated with core inflation, which is what the central bank primarily focuses on, according to the analyst.

"Even if rising energy prices could make the Fed's job of lowering interest rates more difficult, central banks remain mainly focused for now on bringing down core inflation, or the elements of prices not directly associated with volatile food and fuel," Blanch said.

— Spencer Kimball

Wed, Apr 3 2024 2:20 PM EDT

Copper futures reach 13-month high, extending copper ETF to five-day advance

May copper futures reached a high of $4.1995 per pound on Wednesday, their most expensive since Feb. 22, 2023. Copper, often referred to as "Dr. Copper" for its ability to predict the health of the economy, is now higher by 4.6% this week and on pace for its first weekly gain in three weeks.

That move helped send the Global X Copper Miners ETF (COPX) to its highest since April 2022, on pace for a fifth straight advance for the first time since last November. Freeport-McMoRan climbed to its highest since since April 2022 while Southern Copper reached an all-time high.

Among other base metals, aluminum on the London Metals Exchange rose to its highest Wednesday since April, 2023, while zinc was on track for its best day since last November.

See Chart...
May copper futures over past six months.

— Scott Schnipper, Nick Wells

Wed, Apr 3 2024 2:03 PM EDT

Small caps bounce

Small-cap stocks outperformed on Wednesday, offering a bright spot amid a particularly tough week.

The small-cap focused Russell 2000 added 0.7% in the session, beating the broad S&P 500's 0.3% gain.

Despite that outsized advance, the index is still lagging. The Russell 2000 has lost more than 2% this week, while the S&P 500 has slipped less than 1%. The index has also clearly underperformed the broader market on the year.

See Chart...
The Russell 2000 vs. the S&P 500, 1 day

— Alex Harring

Wed, Apr 3 2024 1:41 PM EDT

Steve Cohen says a four-day work week is an 'eventuality'

Billionaire financier and Mets owner Steve Cohen said he believes a four-day work week could soon be the norm — an idea that has also influenced his 2023 investment in golf startup league TGL. 

"I think I would have done the golf investment anyway, because I think there's a longer-term thought, but my belief is a four-day work week is coming," Cohen told CNBC's "Squawk Box" on Wednesday. 

The increasing presence of artificial intelligence will likely also contribute to a shorter work week, as well as the fact there are generally lower productivity levels on Friday, Cohen said.

The full story can be found here.

— Hakyung Kim

Wed, Apr 3 2024 1:33 PM EDT

Disney trades lower following proxy fight verdict

Disney traded down more than 1% in afternoon trading as investors reacted to news that the entertainment giant won its proxy fight against Nelson Peltz's Trian Partners.

Shareholders voted to reelect the media powerhouse's full board, according to preliminary results. While the victory was widely expected, it marks the end to a months-long battle.

See Chart...
Disney, 1-day

Disney shares have soared nearly 34% in 2024, notably outperforming the broader market.

Guggenheim Securities updated its estimates on a handful of Disney's businesses and raised its price target to $140 from $125 Wednesday morning as investors awaited the results.

Given that the outcome of the vote "is unlikely to impact near-term operating trends or financial results," the firm updated its model to reflect momentum in Disney's domestic and international parks businesses, continued pressure on its linear networks business and an "incrementally more back-half weighted cadence" in content, Guggenheim's Michael Morris said in a note Wednesday.

— Alex Harring, Tanaya Macheel

Wed, Apr 3 2024 1:20 PM EDT

Cathie Woods buys more Tesla, says now is 'not the time to run for the hills'

Ark Invest CEO Cathie Wood told CNBC's Andrew Ross Sorkin on Wednesday that now is "not the time to run for the hills" on Tesla.

The comments from Wood come as the shares underperform on the year and as the investment firm scooped up more shares of the electric vehicle maker on Tuesday.

Read more on why Wood remains bullish on Tesla and what she expects for the stock here.

— Samantha Subin

Wed, Apr 3 2024 12:57 PM EDT

Powell says economy and policy are in 'a pretty good place'

Federal Reserve Chair Jerome Powell expressed confidence Wednesday about the current state of the economy and policy.

"I think we've gotten to what is, knock on wood, a pretty good place," Powell said in remarks at Stanford University. "We're using our tools now to try to bring inflation down the rest of the way to 2%, all while keeping the economy strong as well."

—Jeff Cox

Wed, Apr 3 2024 12:39 PM EDT

Intel, Spotify among Wednesday's biggest midday movers

Here are some of the stocks on the move during midday trading:

Read the full list of names on the move here.

— Samantha Subin

Wed, Apr 3 2024 12:14 PM EDT

Powell says Fed needs more signs of easing inflation to cut rates

Federal Reserve Chair Jerome Powell said Wednesday that the central bank needs more evidence that price pressures are easing to begin lowering interest rates.

"On inflation, it is too soon to say whether the recent readings represent more than just a bump," Powell said in prepared remarks ahead of a question-and-answer session at Stanford University.

"We do not expect that it will be appropriate to lower our policy rate until we have greater confidence that inflation is moving sustainably down toward 2 percent," he added. "Given the strength of the economy and progress on inflation so far, we have time to let the incoming data guide our decisions on policy."

— Jeff Cox, Alex Harring

Wed, Apr 3 2024 11:45 AM EDT

Some sectors sit out of S&P 500's rise

Real estate, utility and consumer staple stocks bucked the S&P 500's advance on Wednesday.

The three sectors were the only of the 11 that comprise the broad index to trade lower. As a whole, the S&P 500 was up about 0.4%.

On the other hand, information technology and industrials led the index higher, gaining more than 0.7% each.

— Alex Harring

Wed, Apr 3 2024 11:17 AM EDT

Steven Cohen says it's 'going to be hard' for Fed to hit 2% inflation target

Billionaire hedge fund manager Steve Cohen told CNBC's Andrew Ross Sorkin on "Squawk Box" that it will be difficult for the Federal Reserve to get inflation back down to its 2% goal.

"The Fed thinks it's eventually going to come down to a 2% inflation rate. ... I think that's going to be hard," Cohen said.

The Point72 CEO said Wednesday that he doesn't disagree with market expectations for three rate cuts this year, but he added that there's a lot of "underemployment" in the country, which could create upward pressure on inflation if economic growth remains strong.

— Jesse Pound

Wed, Apr 3 2024 10:50 AM EDT

Ulta Beauty shares dive as execs warn category growth is slowing faster than expected

Ulta Beauty shares dove more than 13% in trading after executives warned that sales growth in the category is slowing faster than anticipated. As of shortly after 10:45 a.m. ET, the stock was tracking for its worst session since March 2020.

See Chart...
Ulta Beauty shares are down year to date.

The beauty products retailer was speaking at the JPMorgan Retail Round Up Conference and said it had anticipated a sales moderation in 2024 after several years of "very strong growth." However, it was estimating a "mid-single digit range."

"What we've seen so far is a slowdown in the total category across price points and segments," Ulta said, according to a FactSet transcript. Management added that the trend is "a bit earlier and a bit bigger than we thought."

—Christina Cheddar Berk

Wed, Apr 3 2024 10:30 AM EDT

Latest employment data provides 'little confidence' that Fed has justification to start cutting rates in May, says LPL chief strategist

Wednesday's stronger-than-expected private payroll data from the ADP was bad news for investors hoping the Federal Reserve will start lowering interest rates in May, said Quincy Krosby, chief global strategist for LPL Financial.

"The ADP report offers little confidence that inflation is easing at clip that will allow the Fed to begin cutting rates as soon as the May FOMC meeting," Krosby said.

Krosby said traders will monitor commentary from Fed Chair Jerome Powell later on Wednesday to see if he appears more hawkish.

— Alex Harring

Wed, Apr 3 2024 10:10 AM EDT

ISM PMI comes in cooler than expected

The ISM non-manufacturing purchasing managers index came in under expectations for March.

The index registered 51.4 for the month. That's under the 52.7 consensus estimate of economists polled by Dow Jones. It also marks a decline from February's 52.6 reading.

— Alex Harring

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