Stocks Dip, Gold Peaks at $2,343; Bitcoin Below $70K Before CPI Data

Key Takeaway

• Stocks dip ahead of CPI report, with S&P 500 down 0.2% and Dow losing 0.4%, amid expectations of a slight CPI increase to 3.4%.
• Gold hits new highs at $2,343; Bitcoin falls below $70,000; Treasury yields drop as bond demand rises.
• Notable stock movements include Nvidia's 3% fall, Cisco's 4% rally after a price target raise, and Moderna surging over 5% on vaccine study results.

Anticipation Ahead of CPI Report

Stocks experienced a slight downturn during Tuesday's midday trading as the market braced for the upcoming Consumer Price Index (CPI) report, expected to be released on Wednesday. This report is highly anticipated as it could provide significant insights into the Federal Reserve's future monetary policy decisions. Wall Street analysts predict the annual CPI rate to increase marginally from 3.2% to 3.4% in March, primarily due to a rise in gasoline prices. Conversely, core inflation, which excludes volatile food and energy prices, is expected to decrease slightly from 3.8% to 3.7%.

Market Movements and Sector Performance

The S&P 500 index saw a modest decline of 0.2%, with financials, industrials, and energy sectors leading the downturn. In contrast, the technology sector remained relatively stable. The Dow Jones Industrial Average fell by 0.4%, while small-cap stocks showed resilience, edging 0.1% higher. This mixed performance reflects the market's cautious stance ahead of the CPI data release. Treasury yields dipped slightly as demand for bonds increased, indicating investors' preference for safer assets in uncertain times.

Individual Stock Highlights

Notable movements in individual stocks included Nvidia Corp., which fell by 3%, marking its potential lowest close since early March and its third consecutive week of declines. In contrast, Cisco Systems Inc. saw a 4% increase after Morgan Stanley raised its price target for the company. Moderna Inc. surged over 5% following promising results from an early study of its cancer vaccine, while MP Materials Corp. rallied nearly 8% after receiving a significant tax-credit award. Freeport-McMoRan Inc. and Hudbay Minerals Inc. also experienced notable gains following upgrades from Bank of America.

Bitcoin's Volatile Journey and Market Sentiment

Bitcoin's price has been on a volatile path, struggling to maintain its position below the $70,000 mark after a recent high near $74,000. The introduction of spot Bitcoin ETFs in the U.S. and the upcoming halving event have supported demand, contributing to a 60% rally this year. However, the market awaits further direction from the U.S. PCE inflation data, with $65,000 seen as a strong support level. Analysts note that the proportion of Bitcoin held by short-term holders has increased, suggesting a potential shift in market dynamics that could signal the approach of a cyclical peak.

Street Views

• Morgan Stanley on Cisco Systems Inc. (Bullish on Cisco):

  "Morgan Stanley raised the company’s price target to $58."

• Bank of America on Freeport-McMoRan Inc. (Bullish on Freeport-McMoRan):

  "Bank of America upgraded its outlook from Neutral to Buy."

Management Quotes

• Cathie Wood, CEO of ARK:

  "She has sold nearly $4 million worth of Nvidia shares."