The leading U.S. indices are exhibiting prospects of a relatively undisturbed opening on Tuesday, as the stock market displays minimal direction following Monday's modest retraction.
Investors remain hesitant about the future course of the markets, which could lead to transitional trading on Wall Street, following the Dow and S&P 500's recent ascension to unprecedented highs.
The uncertainty could also cause traders to adopt a wait-and-see approach in anticipation of crucial economic indicators later this week, such as the essential inflation report. In particular, the Commerce Department is expected to release data on personal income and spending, which includes an inflation report favored by the Federal Reserve.
Depending on its outcomes, the inflation data might significantly influence the forecast for interest rates as Federal Reserve officials seek assurance that inflation is experiencing a slump before considering rate reductions.
Following a lukewarm start to Monday, U.S. stocks ended the day on a low note, with investors remaining cautious ahead of the release of crucial economic data. The Dow concluded the day 62.30 points or 0.2% lower at 39,069.23, with the S&P 500 down 19.27 points or 0.4% at 5,069.53, and the Nasdaq closing 20.57 points or 0.1% lower at 15,976.25.
In financial news, Commerce Department data revealed a 1.5% increase in new home sales, reaching an annual rate of 661,000 in January after experiencing a 7.3% surge to a revised rate of 651,000 in December. This continues the recovery following their lowest rates in a year, observed in November.
Elsewhere, shares of companies such as Palo Alto Networks, Dominos Pizza, Micron Technology, Tesla, Applied Materials, Illumina, Salesforce.com, Arista Networks, Walmart, Marathon Petroleum, Marathon Oil, Qualcomm, and Costco recorded robust gains, while Berkshire Hathaway's share value declined roughly 2% notwithstanding the group's annual profit record of $97 billion.
In Asia, stocks presented mixed results by close on Tuesday, as an unexpected rise in Japanese inflation in January increased pressure on the Bank of Japan to consider a significant policy modification in the coming months.
Chinese shares experienced a spirited rally, courtesy of the over 410 billion yuan injected into onshore shares by state-backed funds this year. The Nikkei 225 and the Topix Index showed marginal increases, settling at 39,239.52 and 2,678.46 respectively.
Key losses were observed in Seoul, with the Kospi closing 0.8% lower at 2,625.05 in anticipation of this week's major U.S. economic data releases. The Australian market closed with little difference, with advances in finance and energy firms counterbalancing mining sector losses.The S&P/ASX 200 Index, a benchmark for the Australian stock market, rose by a small margin of 0.1 percent to 7,663, with investors carefully observing the upcoming inflation ratings in the United States and Australia, in addition to the monetary policy decision by New Zealand's Central Bank. In New Zealand, the S&P/NZX-50 Index experienced a slight decrease, falling 0.1 percent to 11,694.60.
Turning to Europe, Tuesday saw a wavering performance from European stocks as various data sets presented a diverse picture of the economies across the region. A survey from market research company GfK suggested that Germany's consumer confidence is projected to marginally improve in March, with the consumer sentiment index rising from -29.6 in February to -29.0 in March which aligns with the expectations made by economists.
However, French consumer confidence unexpectedly diminished in February as the consumer sentiment index dropped to 89 from 91, contrary to forecasts of an improvement to 92. Meanwhile, the British Retail Consortium revealed a decrease in UK shop price inflation, which fell to a nearly two-year low in February. The shop price index saw a yearly increase of 2.5 percent in February, which was down from a 2.9 percent increase in January, marking the lowest growth since March 2022.
The German DAX Index saw an increase of 0.5 percent, while both the French CAC 40 Index and UK's FTSE 100 Index both yielded a slight decline of 0.1 percent.
In terms of individual performances, asset management company Abrdn saw an impressive surge after reporting reduced full-year losses and announcing plans to cut approximately 500 jobs as part of a cost reduction scheme. Medical device manufacturer Smith & Nephew also exhibited strong performance following improved financial results for the fourth quarter and the full year of 2023.
French retailer Casino experienced a steep climb after a French court approved its restructuring plan. Shares in technology giant Capgemini saw a minor increase after the announcement of a deal worth over 100 million Euros with TenneT, a European transmission system operator, for the design, construction, and implementation of a cloud platform to enhance the functioning of TenneT.
On the other hand, U.S manufacturing trends saw a significant decrease in new orders for durable goods in January. According to a report by the Commerce Department, the orders dipped by 6.1 percent in comparison to a smaller adjusted decrease of 0.3 percent in December, exceeding the expected drop of 4.5 percent.
Additionally, Zoom Video stock experienced a rise in pre-market trading in response to fourth-quarter results being reported as better than anticipated, along with the announcement of a $1.5 billion stock buyback. Biopharmaceutical company Viking Therapeutics also saw surging pre-market shares following the release of positive top-line results from a Phase 2 clinical trial for a new weight-loss treatment. However, Unity Software is expected to face downward pressure following slightly disappointing fourth quarter earning reports accompanied by a bleak future guidance.
