The S&P 500 Index and Nasdaq Composite closed at yet another record high on Monday as market sentiment rose as more investors now expect an interest rate cut in September. The broader market index rose 0.10% to settle at 5,572.85, while the tech-heavy index climbed 0.28% to close at 18,403.74. Still, trading was cautious ahead of more inflation data and the start of the earnings season later this week. The Dow Jones Industrial Average slipped over 30 points lower.
Here's how the market settled on Monday:
S&P 500 Index (NYSE: SPY): +0.10% or +5.66 points to 5,572.85
Dow Jones Industrial Average (NYSE: DIA): -0.08% or -31.08 points to 39,344.79
Nasdaq Composite Index (NASDAQ: QQQ): +0.28% or +50.98 points to 18,403.74
In Focus:
The S&P 500 is coming off another positive week as investor optimism surrounding a cooling labor market and easing inflation could lead the Federal Reserve to issue at least one rate cut this year. Market participants are currently pricing in one rate cut in September, followed by another potential one in December, according to the CME Group's FedWatch Tool.
The week ahead will host June's consumer price index and producer price index inflation readings, which could further boost sentiment if the data continues recent trades of easing inflationary pressures on the U.S.. economy.
Moving Markets:
Boeing (NYSE: BA) agreed to plead guilty to criminal fraud stemming from the fatal 737 Max crashes in 2021 late Sunday. Under the deal, which requires a federal judge to approve, Boeing would face a fine up to $487.2 million, must install an independent compliance monitor for three years and invest at least $455 million in compliance and safety programs.
Paramount Global (NASDAQ: PARA) was in the news Monday after the media and entertainment giant reached a deal to merge with Skydance Media, the companies announced Sunday. The deal includes Skydance first acquiring Shari Redstone and National Amusements', her family's holding company, shares for $2.4 billion in cash before completing a full merger. Skydance CEO David Ellison will become Chairman and CEO of the combined company, which will be valued at $4.75 billion following the deal's completion.
"As a longtime production partner to Paramount, Skydance knows Paramount well and has a clear strategic vision and the resources to take it to its next stage of growth," Redstone said in a release.
Eli Lilly (NYSE: LLY) announced Monday it has agreed to acquire the biopharmaceutical company Morphic Holding (NASDAQ: MORF) in a $3.2 billion deal that would expand Lilly's portfolio of treatments in development for gastroenterological diseases such as ulcerative colitis and Crohn's disease.
"Oral therapies could open up new possibilities for earlier intervention in diseases like ulcerative colitis, and also provide the potential for combination therapy to help patients with more severe disease," said Daniel Skovronsky, chief scientific officer at Lilly and president of Lilly Research Laboratories and Lilly Immunology, in a release, anding that this "strategic transaction reinforces our commitment to developing new therapies in the field of gastroenterology, where Lilly has made significant investments to deliver first-in-class molecules for the benefit of patients."
In Economic News:
Consumer Inflation Expectations declined in June as Americans now expect prices for a basket of goods including gas and food to rise at a slower rate for the near- and long-term, a survey released by the New York Federal Reserve showed on Monday.
The Fed's Survey of Consumer Expectations showed inflation for both one- and five-year outlooks decline by 0.2 percentage points, to 3% and 2.8%, respectively. Still, the medium-term three-year outlook ticked higher to 2.9%.
For Tuesday:
Market participants will react to a series of Fedspeak, including testimony by Fed Chair Jerome Powell before the Senate Banking Committee on Tuesday.