Here are the top news, trends and analysis investors need to start their trading day:
1. Wall Street looks lower after posting a multi-day winning streak
Traders on the NYSE floor, March 29, 2022.
Source: New York SE
US stock futures pointed to a lower open on Wednesday, a day after the Dow Jones Industrial Average and S&P 500 posted four winning streaks and the Nasdaq posted back-to-back gains. Wall Street shrugged off a recession signal from inverted bond yields as ceasefire talks between Russia and Ukraine raised hopes of diplomatic progress.
With two trading days left in March, the Dow, S&P 500 and Nasdaq were all poised to break their two-month losing streak with solid gains. The Nasdaq closed outside of correction territory on Tuesday, now less than 10% below its November record high. US oil prices rose 2% early Wednesday after a two-day losing streak. West Texas Intermediate crude posted a fourth straight monthly gain.
2. Returns no longer inverted; Mortgage rates are rising, affecting refi demand
The yield spread between the 5-year and 30-year Treasuries stopped inverting early Wednesday. The 5-year yield rose above the 30-year yield for the first time since 2006 on Monday and remained there on Tuesday. The 2-year Treasury yield and the benchmark 10-year yield were little changed on Tuesday and closed early Wednesday.
Mortgage rates skyrocketed last week, causing total home loan volumes to fall by 6.8%. The Mortgage Bankers Association said the 30-year fixed-rate mortgage rose 0.3 percentage points to 4.8% for the week ended March 25, the largest one-week rise since February 2011. This pushed refinance requests down 15 week-on-week % and further back a whopping 60% from a year ago. Demand for home loans rose 1% this week but was 10% lower than the same week a year ago.
3. US companies added 455,000 jobs in March, according to ADP
Pedestrians walk past a Now Hiring sign on March 16, 2022 in Arlington, Virginia.
Stefanie Reynolds | AFP | Getty Images
Two days before the government’s jobs report for March, the latest before the Federal Reserve meeting in early May, ADP said Wednesday morning that US companies added 455,000 jobs in March, broadly in line with estimates. The total was below February’s revised upwards of 486,000, bringing ADP’s private payroll to 1.45 million in the first quarter. The ADP data during Covid was not a good indicator of what the government jobs report might show. The Fed must balance concerns about economic growth and a recession against rising prices. Central bankers are expected to be more aggressive in raising interest rates to fight inflation.
4. Russia’s pledge to scale back attacks on Ukraine was met with skepticism
A completely destroyed building is seen after Russian shelling March 30, 2022 in Sviatoshinsky district in Kyiv, Ukraine.
Metin Aktas | Anadolu Agency | Getty Images
Russian attacks on Ukraine continued on Wednesday, a day after Moscow vowed to scale back its military activities near Ukraine’s capital Kyiv and the northern city of Chernihiv. Russia’s pledge to scale back its aggression was met with skepticism in Ukraine, the United States and Britain. Russian and Ukrainian delegates met in Istanbul on Tuesday. The Ukrainian delegation set out a framework under which the country would declare itself neutral and its security would be guaranteed by a number of other nations.
5. Health authorities approve another round of Covid vaccine boosters
Vials with Pfizer BioNTech and Moderna coronavirus disease (COVID-19) vaccine labels are seen in this illustrative image taken on March 19, 2021.
Dado Ruvic | Reuters
The Food and Drug Administration approved fourth Pfizer and Moderna Covid shots for everyone aged 50 and over, as senior health officials declared the more contagious Omicron subvariant BA.2, the version of Covid-19 prevalent in the United States. The FDA also approved a fifth dose for certain younger people with compromised immune systems. Immunocompromised people 12 and older are eligible for a fifth dose of Pfizer, and immunocompromised 18-year-olds and older are eligible for Moderna. The Centers for Disease Control and Prevention was quick to endorse the decision.
A healthcare worker fills a syringe from a vial with a dose of Johnson & Johnson vaccine against the COVID-19 coronavirus as South Africa continues with its vaccination campaign at Klerksdorp Hospital February 18, 2021.
Phil Magakoe | AFP | Getty Images
The CDC also recommended that all adults who received two doses of Johnson & Johnson’s vaccine receive a third dose of either Pfizer or Moderna. Adults who received the J&J vaccine and a second injection of Pfizer or Moderna are not yet eligible for a third dose unless they are 50 years of age or older or have a compromised immune system. All new booster vaccinations should be given no earlier than four months after the last vaccination.
– CNBC reporters Chloe Taylor, Vicky McKeever, Diana Olick and Spencer Kimball, as well as The Associated Press and Reuters contributed to this report.
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