Wall Street Stocks Waver as US Dollar Moves Further Upside
Wall Street stocks waver for an indecisive start of week. US dollar moves firmly to the upside as the EUR/USD slips below 1.14.
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Principal Points
- Stocks on Wall Street finish Monday’s session hugging the flatline
- The US dollar gains renewed buying momentum as EUR/USD slips below 1.14
What’s Moving in the Markets?
Wall Street stocks endured a choppy trading session to start the week while Tesla shares extended their decline. In more detail, the Dow Jones Industrial Average, the S&P500, and the Nasdaq Composite finished Monday virtually flat but in the red. Tesla stock, in particular, dropped 1.9% on the day after recovering early-session loss of more than 5%.
Recent inflation jitters have knocked investor confidence as companies face increased difficulties heading into the year-end. That said, the same inflation pressures have been lingering over the market for several months now.
But as the year progresses, it’s becoming harder to maintain the viewpoint of the Fed which says higher prices are temporary. Moreover, the US central bank continues to state that the surge in consumer prices will fade as the economy recovers.
To illustrate, the October inflation report showed consumer prices rose 6.2% on an annualized basis, the biggest price jump in 31 years.
Meanwhile, the US dollar pushed higher against the euro. The pair reached a 16-month low as it slipped below 1.14. Presently, the exchange rate hovers near 1.1380.
Tesla Slides Further as JPMorgan Files a Suit
In individual stock action, shares of Tesla are deeply in the red this month after Elon Musk began selling huge blocks of shares. More precisely, Tesla is down about 17% from its all-time high while Mr. Musk has sold about $8 billion worth of stock. The latest selling round was yesterday when the billionaire offloaded shares valued at nearly $1 billion.
At the same time, JPMorgan filed a suit against Tesla, saying it has breached a contract over warrant transactions.
In more detail, the case is about a series of stock warrants from 2018. These warrants require Tesla to deliver to JPMorgan either shares or cash if Tesla stock was over the “strike price” when the warrant expired.
“Tesla has flagrantly ignored its clear contractual obligation to pay JPMorgan in full,” JPMorgan says in the complaint.
What’s Happening in Cryptocurrency?
Bitcoin and the wider cryptocurrency markets have pulled back from last week’s highs as traders paused their heavy buying. That said, the price of bitcoin slipped under $61,000 early on Tuesday.
In addition, the price of Ether, the second-biggest coin, is trading near $4,330. Both major cryptocurrencies are down by roughly 5% on the day.
Still, projections for crypto markets remain bright as more people are joining the nascent space. Further, institutional adoption has been growing at a steady pace. To this end, investment banks and Wall Street professionals are expected to hop on once clear regulations arrive.
What to Watch in the Markets?
Looking ahead, forex markets could go through elevated volatility on Wednesday. The European Union and the UK release their inflation data for October. The news is likely to affect the euro and the sterling, respectively.
Economic Data Coming Up Today (EST times)
On Tuesday, financial markets will pay attention to the core retail sales coming from the US at 08:30 am. Later, at 11:10 am, European Central Bank President Christine Lagarde will give a speech. With this in mind, the US dollar and the euro could swing more than usual during the announcements.