Live Markets: Wall Street trades sideways in early going

Senti Biosciences Holdings

26/05/2021 15:09

* Major U.S. indexes mixed; small caps outperform
    * Healthcare weakest major S&P sector; cons disc leads
gainers 
    * Euro STOXX 600 index off ~0.1%
    * Dollar edges up; gold up, crude down; bitcoin up ~2%
    * U.S. 10-Year Treasury yield ~1.57%

    May 26 - Welcome to the home for real-time coverage of
markets brought to you by Reuters reporters. You can share your
thoughts with us at markets.research@thomsonreuters.com
        
    WALL STREET TRADES SIDEWAYS IN EARLY GOING (0952 EDT/1352
GMT)
    Wall Street traded sideways in the early going Wednesday, as
Amazon.com Inc's  .AMZN.O  move to buy Metro Goldwyn Mayer
(MGM), the fabled U.S. movie studio home to the James Bond
franchise, provided some upside that was offset by falling
energy and financial shares.
    In what may prove to be a repeat of Tuesday's session,
stocks are trading near breakeven, with the Nasdaq  .IXIC  up
but the S&P 500  .SPX  and Dow Industrials  .DJI  slightly
lower. 
    Despite easing concerns about a spike in inflation after
soothing talk from Federal Reserve officials, investors still
want to see a key inflation gauge to be released later in the
week.  .N 
    Amazon.com  AMZN.O  is rising, making it a big early
contributor on the positive side to the S&P 500. Home Depot Inc
 HD.N  and Google parent Alphabet Inc  GOOGL.O  are also
providing early strength.
    Social media darlings GameStop Corp  GME.N  and AMC
Entertainment  AMC.N  are up, extending solid gains from
Tuesday.
    The initial public offering of Flywire Corp  FLYW.O  and
Dynamics Special Purpose Corp  DYNS.O  begin trading early on
Wednesday.
    Markets have been choppy this week with little economic data
to trade on. Fed officials have managed to tap down inflation
angst, insisting any jump in consumer prices will be temporary,
while an easing in soft commodity prices has helped.
 urn:newsml:reuters.com:*:nL2N2ND0UA
    All eyes will be on Friday's release of the Core PCE Price
Index, the Fed's preferred gauge of inflation, while the second
preliminary GDP estimate for the first quarter, jobless claims
and pending homes sales are on tap for Thursday.
    Federal Reserve Vice Chair Randal Quarles speaks later.
    Gold  XAU=  topped $1,900 an ounce for the first time since
January in a sign the mood is risk-on among investors, as the
yield on 10-year U.S. Treasury notes  US10YT=RR  continues to
drift lower, falling to a low of 1.557% in early trade. 
    Stocks face some strong headwinds with the S&P 500 up nearly
12% year to date. The benchmark index will end the year only
about 2.5% above its current level, according to a Reuters poll
of strategists. Concerns about inflation are likely to temper
some of this year's enthusiasm for U.S. stocks.  urn:newsml:reuters.com:*:nL2N2ND0HP 
    Stocks traded near break-even for most of Tuesday, then
without a catalyst to drive prices higher, the S&P 500, Dow
Industrials and Nasdaq closed lower.
    Here is where markets stand Wednesday shortly after the
open:
  
    
    (Herbert Lash)
    *****
    
    
    SMALL CAPS: MAY NEED TO GET BACK ON THE BIKE, AND FAST!
(0900 EDT/1300 GMT)
    In the wake of its biggest rolling 12-month gain ever, the
small-cap Russell 2000  .RUT  topped in March after once again
flirting with a weekly log-scale channel resistance line
 urn:newsml:reuters.com:*:nL1N2M113G:
    
    
    Since then, the index has turned heavy. In fact, the RUT
ended Tuesday down more than 6% from its 2,360.17 March intraday
high.
    In a testament to just how stretched to the upside the RUT
had become earlier in the year, with its March 12 weekly closing
high, it finished 49.8% above its 200-week moving average (WMA).
This was its greatest level of disparity vs this long-term
moving average since October 1997, when it peaked 49.9% above
it.
    Of note, from 1997 to 2018, there were six major RUT 200-WMA
disparity tops greater than 30%. In all six instances, readings
ultimately fell below parity.
    Although the RUT's tires have deflated to some extent, at
Tuesday's close of 2,206, it remains nearly 37% above its rising
200-WMA, which is now around 1,616.
    Thus, there could be substantial downside risk in the event
the index quickly descends to meet this rising long-term
average, which has recently only been gaining around 4 points a
week.  urn:newsml:reuters.com:*:nL2N2NC0V7
    
    (Terence Gabriel)
    *****
    
    FOR WEDNESDAY'S LIVE MARKETS' POSTS PRIOR TO 0900 EDT/1300
GMT - CLICK HERE:  urn:newsml:reuters.com:*:nL2N2ND0XW
    
    
    
    
    
    
 

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earlytrade05262021B    https://tmsnrt.rs/3uphfNx
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 (Terence Gabriel is a Reuters market analyst. The views
expressed are his own)