Stocks Continue Falling to Start Week
By Joe Wallace
U.S. stocks edged down Monday, following a week in which
concerns about inflation whipsawed markets.
The Dow Jones Industrial Average fell 142 points, or 0.4%, after
the opening bell. The S&P 500 dropped 0.4%, while the
technology-heavy Nasdaq Composite declined 0.5%.
With earnings season drawing to a close, investors remain
focused on whether a recent jump in inflation will blow over or
become entrenched. A protracted spell of faster growth in consumer
prices could prompt the Federal Reserve to tighten monetary policy,
potentially hurting stocks and other assets that have gained from
low interest rates.
Those concerns last week led the S&P 500 to post its biggest
decline since late February, even after staging a rebound Friday.
Highflying tech stocks have been particularly vulnerable to worries
about inflation: The Nasdaq Composite has fallen for four straight
weeks, its longest losing streak since August 2019.
"We see this as transitory, but you never know: there is stuff
in here that could take a bit longer," said Lars Skovgaard
Andersen, investment strategist at Danske Bank Wealth Management.
"There will be some volatility in markets still."
Discovery's Class A shares jumped 6.6%. The television company
said it would combine its media assets with those of AT&T into
a new publicly traded company. AT&T, which would receive $43
billion, rose over 4.3%.
ViacomCBS rose 2.7%. The media company said late Friday it will
reclaim Les Moonves's $120 million severance package, resolving a
more than two-year dispute with the former chief executive over his
Quickening inflation has sharpened focus on statements by Fed
officials, who have made the case that the pickup will fade,
allowing the central bank to keep supporting the economy. Vice
Chair Richard Clarida is due to speak at the Federal Reserve Bank
of Atlanta Financial Markets Conference at 10:05 a.m. ET.
Bitcoin dropped more than 8% over the weekend to around $45,100
after a tweet by Tesla Chief Executive Elon Musk prompted
speculation that the electric-car maker had sold, or would sell,
its holdings of the cryptocurrency. Mr. Musk later tweeted that
Tesla hadn't sold any bitcoin. Tesla shares slipped 1.4%.
Gold futures rose 0.8% to $1,853.30 a troy ounce, their highest
level since February. Money has started to flow back into the SPDR
Gold Trust, the biggest gold-backed exchange-traded fund, this
In the bond market, the yield on 10-year Treasury notes was
1.639%, unchanged from Friday.
Overseas, the Stoxx Europe 600 was recently up less than 0.1%.
Chinese stocks rose after data showed the nation's industrial
output jumped 9.8% year-over-year in April, beating forecasts,
while retail sales rose by a lower-than-expected 17.7%. The
Shanghai Composite Index advanced 0.8%.
In Taiwan, the benchmark Taiex fell 3%, building on a pullback
of more than 8% last week. Over the weekend, authorities
implemented more restrictive measures to combat Covid-19 amid a
spike in new local infections, and on Monday Taiwan reported a
record high of 333 new local cases.
Japan's Nikkei 225 lost 0.9%.
Chong Koh Ping in Singapore contributed to this article.
Write to Joe Wallace at Joe.Wallace@wsj.com
(END) Dow Jones Newswires
May 17, 2021 10:17 ET (14:17 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.