Linea Mercati Interview 5/23/23
May 23, 2023Linea Mercati Interview 5/24/23
May 24, 2023By Shreyashi Sanyal and Shristi Achar A
May 23 (Reuters) – Wall Street was set to open lower on Tuesday as another round of inconclusive talks over increasing the U.S. debt limit raised the spectre of an unprecedented government default.
White House and congressional Republican negotiators will meet again later in the day to discuss how to raise the $31.4 trillion debt ceiling, with just nine days left for the deadline.
This comes after President Joe Biden and House Speaker Kevin McCarthy could not reach an agreement about the debt ceiling in their meeting on Monday, but vowed to keep talking.
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Trading on the S&P 500 index (.SPX) was stuck in a 30-point range in the last two sessions as U.S. debt ceiling talks lingered, while a megacaps-led bounce on the Nasdaq (.IXIC) helped it close the previous day higher.
“The markets have had some nice rallies over the past weeks and the debt ceiling talks are an excuse to be cautious here,” said Peter Cardillo, chief market economist at Spartan Capital Securities
“The real reason for stalling the advance is the yields that continue to rise.”
Worries over the debt limit pushed yields on one-month Treasury bills to record highs at 5.888%.
Investors also await S&P Global’s flash reading of the U.S. Composite PMI Index for May and Dallas Federal Reserve President Lorrie Logan’s remarks due later in the day.
The Commerce Department’s April personal consumption expenditure (PCE) index reading, the Fed’s preferred inflation gauge, is due on Friday.
Megacaps were largely subdued with Meta Platforms Inc (META.O), Apple Inc (AAPL.O) and Alphabet Inc (GOOGL.O) down between 0.2% and 0.4% in premarket trading.
Lowe’s Companies Inc (LOW.N) fell 1.3% after the retailer cut its annual comparable sales forecast, as demand dwindles for home improvement goods with high inflation forcing consumers to cut back on discretionary spending.
Shares of larger rival Home Depot (HD.N) dipped 0.1%.
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Dicks Sporting Goods (DKS.N) added 2.5% after the retailer beat first-quarter estimates and reiterated its annual sales forecast.
At 8:28 a.m. ET, Dow e-minis were down 65 points, or 0.19%, S&P 500 e-minis were down 9.75 points, or 0.23%, and Nasdaq 100 e-minis were down 35.5 points, or 0.26%.
Zoom Video Communications (ZM.O) fell 2.6% after the video conferencing platform recorded its slowest quarterly revenue growth.
Shares of regional lenders extended gains from the previous session, led by a 16.2% rise in PacWest Bancorp (PACW.O).
Western Alliance Bank (WAL.N), Zions Bancorporation NA (ZION.O) and First Horizon Corp (FHN.N) were up between 1% and 2.3%.
Reporting by Shreyashi Sanyal in Bengaluru Editing by Vinay Dwivedi
Our Standards: The Thomson Reuters Trust Principles.
