Stocks finished lower Monday, as Wall Street took a step back from a record-setting rally while gearing up for a week of jobs data and two public appearances from Federal Reserve Chairman Jerome Powell.
The Dow Jones Industrial Average ended down 0.25% to 38,989, while the S&P 500 slipped 0.12% to 5,130.95 and the tech-heavy Nasdaq lost 0.41% to 16,207.51.
Looking ahead, Sam Millete, director of fixed income at Commonwealth Financial Network, said "it's going to be a big week for politics" as Powell gives his semiannual congressional testimony on monetary policy starting on Thursday with the Senate.
"This is going to be a really interesting congressional testimony because we're kind of at an inflection point with Fed policy," he said. "And while a lot of economists are expecting Chair Powell to reiterate many of his comments that he made at the end of the January Fed meeting, there's always the potential some surprises which could lead to some volatility."
The February jobs report is scheduled to be released on Friday.
Millete said economists expect to see a slowdown in hiring during the month, with about 200,000 jobs expected in February, down from a little over 353,000 jobs in January.
"With that being said, anything could happen, so it'll be another interesting week when we look at the markets," he said.
Updated at 12:37 PM EST
Weighty gains
Eli Lilly (LLY) shares jumped higher again Monday, extending the stock's year-to-date gain to around 34.4%, following a price target upgrade for the drugmaker from analysts at UBS.
Analyst Trung Huynh lifted his Eli Lilly price target by $100, to $910 per share, citing the entrenched market share it and rival Novo Nordisk NOVO are likely to maintain in the weight loss drug category.
Eli Lilly's new Mounjaro drug, which targets obesity, produced sales of $2.21 billion over the three months ending in December, with related sales from Zepbound pegged at $175.8 million.
UBS: ".. we see $LLY and Novo increasingly entrenched and maintaining a majority market share with any potential external competition unlikely to be commercially viable until the 2027/28 time frame .."
— Carl Quintanilla (@carlquintanilla) March 4, 2024
Ups $LLY to $910 (prior $810)
Updated at 10:46 AM EST
Bitcoin Bounce
Bitcoin prices are on pace to test their all-time highs from late 2021 over the coming days as the world's largest digital currency continues to benefit from the launch of exchange-traded funds earlier this year.
Bitcoin prices were last marked 4.7% higher on the session and changing hands at $66,136.80 each, just a shade under it's December 2021 peak of around $68,500.
Bank of America's weekly ''Flow Show" report, meanwhile, notes that around $2.4 billion found its way into crypto funds last week, following inflows of $1.2 billion and $2.6 billion over the prior two weeks.
Updated at 9:39 AM EST
Softer Open
The S&P 500 slipped 6.6 points, or 0.12%, from its record Friday close in early trading, while the Dow was marked 119 points lower and the Nasdaq gave back 26 points, or 0.16%, from its own all-time Friday peak.
Related: Key analyst reveals new S&P 500 price target as AI powers record rally
Updated at 8:56 AM EST
Cancelled flight
JetBlue Airways (JBLU) shares jumped higher in pre-market trading after its plans to merge with Spirit Airlines (SAVE) were scrapped, with the low cost rival citing "regulatory obstacles" preventing the $3.8 billion deal from going through.
"We are disappointed we cannot move forward with a deal that would save hundreds of millions for consumers and create a real challenger to the dominant "Big 4" U.S. airlines," said Spirit CEO Ted Christie. "However, we remain confident in our future as a successful independent airline."
The DOJ shut down the merger between $SAVE/ $JBLU because it would “limit competition.” Now both won’t survive… which provides even bigger moats around legacy carriers - thus, limiting competition. Those lobbying dollars by the big boys was well spent!
— Frank Curzio (@FrankCurzio) March 4, 2024
JetBlue shares were marked 4% higher to indicate an opening bell price of $6.72 each while Spirit slumped 18.7% to $5.21 each.
Updated at 7:31 AM EST
Apple (Must) Pay
Apple (AAPL) shares extended declines in early Monday trading after the tech giant was hit with its first-even EU fine tied to allegations of unfair competition on its app store.
The EU's powerful Competition Commission ordered Apple to pay €1.8 billion ($1.96 billion) for limiting the ability of app developers to notify users of rival options, including Spotify, on its app store.
Apple shares were marked 0.93% lower in pre-market trading to indicate an opening bell price of $177.99 each.
Related: Apple slides as Europe levies massive fine tied to music streaming
Stock Market Today
Stocks ended at record highs again last week, following on from a fourth consecutive monthly gain for the three major indices, as AI-investment hype continues to power the tech sector and better-than-expected economic data lift growth prospects.
Inflation concerns remain elevated, however, following last week's faster-than-expected reading for the January PCE price index, and are likely to remain in focus again this week through a series of labor-market releases, including Friday's crucial February employment report.
Amid that run of jobs data will also come two days of testimony from Powell, first to the U.S. House Financial Services Committee Wednesday and then to the Senate Banking Committee the following day.
The CME Group's FedWatch continues to suggest the Fed will begin cutting rates in June, pegging the chances of a quarter-point reduction at 58%, with at least three more moves lower over the second half.
Benchmark 10-year Treasury note yields were last seen trading at 4.204%, while 2-year notes were holding at 4.554%.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.03% lower at 103.833.
Powell's semiannual testimony, as well as the labor-market data, will highlight a week that is largely bereft of major corporate earnings, although investors will get updates from Target (TGT) , Costco (COST) , Broadcom (AVGO) and Oracle (ORCL) later in the week.
With nearly all the S&P 500 having reported December-quarter earnings, collective profits are forecast to rise 9.8% from a year earlier to $475.2 billion, with around 76.2% topping Wall Street earnings forecasts.
Current-quarter earnings growth, according to LSEG data, is likely to be in the region of 5.2%, with collective, share-weighted profits of $459.6 billion.
Heading into the start of the trading day on Wall Street, futures tied to the S&P 500, which closed at a record 5,137.08 points to extend its year-to-date gain to 7.7%, are priced for a 6 point opening-bell decline.
Contracts linked to the Dow Jones Industrial Average, meanwhile, suggest a 94 point opening-bell dip while those tied to the Nasdaq are indicating an 8 point gain for the tech-focused benchmark.
In overseas markets, Japan's Nikkei 225 crossed the 40,000 point mark for the first time Monday, ending the session 0.5% higher at 40,109.23 points, powered in part by surging chip and tech stocks.
In Europe, the regionwide Stoxx 600 was marked 0.08% lower in Frankfurt, largely tracking U.S. equity futures, while Britain's FTSE 100 slipped 0.45%.
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