Stocks Stall While Gold, Treasuries Rise; Oil Puts Pressure On Energy Stocks: What's Driving Markets Wednesday?

Benzinga - Major large-cap stock indices hovered around parity during early afternoon trading in New York, in a rather subdued trading session on Wall Street.

Traders are grappling with mixed sentiments in the wake of weaker-than-expected ADP employment data from the previous month, hinting at a potential cooling in labor market conditions. This uncertainty looms large ahead of Friday’s eagerly anticipated jobs report.

The prospect of a softer labor market could indeed fuel expectations of future interest rate cuts by the Federal Reserve, but it also raises concerns about weakening household demand, which could cast a shadow on corporate sales and earnings.

In this climate of uncertainty, investors are flocking to haven assets such as Treasuries and gold, while taking a more cautious stance on stocks.

The iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT), which tracks the performance of long-dated Treasury securities, surged by 1.4%, building on Tuesday’s impressive gain of 2.5%.

On the flip side, oil prices tumbled, with West Texas Intermediate (WTI) crude slipping below the $70 per barrel mark. This marks the lowest level seen since early July 2023, as traders continue to question the effectiveness of OPEC’s production cuts and grapple with growing concerns of a global economic slowdown.

Energy stocks, as reflected by the Energy Select Sector SPDR Fund (NYSE:XLE), emerged as Wednesday’s notable underperformers, down by 1.8%.

Bitcoin (CRYPTO: BTC) flattened after crossing the $44,000 milestone, propelling its total market capitalization to an impressive $860 billion

Wednesday’s Performance of US Indices

• The SPDR S&P 500 ETF Trust (ARCA: SPY) edged 0.1% lower to $456.18.
• The SPDR Dow Jones Industrial Average ETF (NYSE:DIA) was steady at $362.10.
• The Invesco QQQ Trust (NASDAQ: QQQ) eased 0.1% to $386.79
• The iShares Russell 2000 ETF (NYSE:IWM) rose 0.8% to $185.77, according to Benzinga Pro data.

Chart Of The Day: Bonds On The Launching Pad

Sector, Industry ETF Performance

Major gainers were the Consumer Discretionary Select Sector SPDR Fund (NYSE:XLY), up 1%, and the Utilities Select Sector SPDR Fund (NYSE:XLU), up 0.8%.

On an industry level, airline stocks, as tracked by the U.S. Global Jets ETF (NYSE:JETS) rose by 3.5%. Oil services, as tracked by the VanEck Oil Services ETF (NYSE:OIH), fell the most, down 2.8%.

Stocks In Focus

• Citigroup Inc. (NYSE:C) rose 3.6% after the company announced a share buyback program of $500 million in Q4.
• Altria Group Inc. (NYSE:MO) and Philip Morris International Inc. (NYSE:PM) both experienced declines of 2.6% and 1.7%, respectively, as they were impacted by the ripple effect of British American Tobacco Industries plc‘s (NYSE:BTI) substantial $31.5 billion devaluation of its cigarette brands, a move that had caused an 9% drop in the stock price.
• Lucid Group Inc. (NASDAQ:LCID) surged over 7% after revealing plans to lower prices and offer greater customization options for its 2024 models, targeting a wider consumer base in North America.
• Campbell Soup Company (NYSE:CPB) rose nearly 8% after the company reported better-than-predicted earnings in the fiscal Q1.
• Carnival Corp. (NYSE:CCL) soared over 5%, amid improving sentiment in travel stocks.
• Brown Forman Inc. (NYSE:BF) fell nearly 9% on disappointing quarterly results.
• SentinelOne Inc. (NYSE:S) is up more than 16% following positive quarterly earnings.
• Robinhood Inc. (NASDAQ:HOOD) is up 9%, on track for the fourth consecutive session of gains, fueled by the recent broad-based crypto rally.
• MongoDB Inc. (NASDAQ:MDB) fell 7% despite strong results in Q3, and several analysts raising price target for the stock.

Read now: 2024’s Potential Stock Surprises: Goldman Sachs Unveils S&P 500 Laggards For Major Gains

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