NEW YORK — On Monday, U.S. stock indices displayed a lack of direction, continuing to reflect the significant downturn experienced the previous week.
The S&P 500 saw a mild increase of 0.1% during midday trading, oscillating between slight gains and losses throughout the morning. These modest fluctuations come after a steep 1.7% decline on Friday, driven by various economic reports from the U.S. that fell short of analyst expectations.
As of 11:45 a.m. Eastern time, the Dow Jones Industrial Average rose by 153 points, or 0.4%, while the Nasdaq composite fell by 0.3%.
Berkshire Hathaway made headlines with a 3.9% increase in stock value, following an announcement of a noted rise in operating profits for the latest quarter. Despite this positive news, the company also revealed it holds an impressive $334.2 billion in cash reserves. This large sum raises some concerns that Buffett, known for his investment acumen during market downturns, may be struggling to find affordably valued stocks in a potentially overvalued market.
Starbucks shares increased by 1.9% after the announcement from new CEO Brian Niccol that the company is cutting 1,100 corporate jobs and leaving several hundred positions vacant in an effort to streamline operations.
Conversely, Domino’s Pizza faced a 2.9% decline after the company reported quarterly results that fell short of expectations, although its international branches performed well. The sales trend for corporate-owned U.S. stores, however, has shown some weakening.
Many large U.S. corporations have reported stronger profits for the last quarter than analysts had forecast, contributing to the S&P 500 reaching a record high before its recent dip. This week will see a slowdown in earnings reports, yet several significant updates are anticipated.
Among the most notable is Nvidia, whose stock has become increasingly pivotal on Wall Street due to the persistent demand for its graphics chips. The company is set to release its first profit report since a major competitor, DeepSeek, announced an AI language model that competes with existing high-end offerings without using premium chips. This revelation raises questions about the investments previously assumed to be flowing into Nvidia and the AI sector as a whole.
Nvidia’s stock showed variability throughout Monday morning’s trading, impacting the S&P 500 and other indices as it fluctuated between gains and losses, ultimately remaining nearly unchanged by midday.
This week will also see earnings reports from Home Depot on Tuesday and Salesforce on Wednesday. Investors are also awaiting updates on consumer confidence and inflation, key issues following last week’s market decline.
Recent indicators suggest a growing negativity in consumer sentiment alongside deteriorating expectations surrounding inflation, partly due to existing tariffs and policies enacted during President Donald Trump’s administration.
Persistent inflation could hinder the Federal Reserve’s ability to provide further economic support through reduced interest rates. Currently, the Fed has maintained its primary interest rate steady after a series of substantial cuts at the end of the previous year, with officials indicating at their latest meeting in January that they might hold the line for some time due to inflationary pressures tied to tariffs and immigration policies.
While lower interest rates can stimulate economic activity, they also risk augmenting inflationary pressures through increased consumer spending.
In the bond market, Treasury yields showed a slight decline ahead of the scheduled releases, with the 10-year Treasury yield dipping to 4.40% from 4.43% late last week.
Internationally, German stocks rose, with the DAX index gaining 0.6% following a conservative election victory focused on the economic concerns facing Europe’s largest economy.
However, broader European and Asian markets were mostly lower, with France’s CAC 40 falling by 0.8% and Hong Kong’s Hang Seng declining by 0.6%. Japan’s markets remained closed for a holiday on this day.
