After two straight weeks of losses due to recession concerns, Wall Street’s major stock indexes were expected to open slightly higher on Monday. Tesla shares also rose after a poll indicated that Elon Musk should step down as CEO of Twitter. In premarket trade, shares of electric vehicle manufacturer TESLA rose 2.5% after the poll revealed that around 57.5% of the 17.5 million respondents supported his leaving Twitter.
After Fed Chair Jerome Powell hinted at further policy tightening and the central bank predicted that interest rates would reach a record high of 5% in 2023, the S&P 500 and the Nasdaq, both indexes, fell by over 2% last week. Market structure researcher and trader Dennis Dick claims that the market’s recent haze is still present. However, today is one day when investors are not as concerned with a recession. Additionally, he said that since he (Musk) took over Twitter, stocks had fallen by almost 50% and that this is the anticipated relief bounce.
John Williams, the president of the Federal Reserve in New York, added fuel to the fire on Friday by stating that it is still possible that the US central bank will increase interest rates more than anticipated next year. Money market participants still predict a 25-basis-point rate increase in February to 4.5%–4.75%, with a terminal rate of 4.84% in May 2023, with a 73.5% probability.
This week’s economic data, which includes housing starts, consumer confidence, weekly jobless claims, and core personal consumer expenditure growth for November, will determine investor sentiment and offer additional hints about the central bank’s potential rate hikes in the future.
At 8:32 a.m. ET, Nasdaq 100 e-minis were up 23 points, or 0.2%, while S&P 500 e-minis were up 4.5 points, or 0.12%. The Dow was up 14 points, or 0.04%. Moderna Inc. (MRNA.O) increased 2.7% after Jefferies changed the stock rating of the biotechnology company from “hold” to “buy,” noting the potential for cancer therapy. Following the announcement that it will pay $4.7 billion for the maker of hypersonic engines, Aerojet Rocketdyne Holdings Inc. (AJRD.N) and L3 Harris Technologies Inc. (LHX.N) suffered a 1.1% loss. Aerojet grew by 1.7%.
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