U.S. Stocks Mostly Lower Following Long Easter Weekend

Following the long Easter weekend, stocks are mostly lower during trading on Monday after turning positive over the course of the previous session last Thursday.

Currently, the Nasdaq and the S&P 500 are off their worst levels of the day but still in negative territory. The Nasdaq is down 86.44 points or 0.7 percent at 12,001.52 and the S&P 500 is down 18.19 points or 0.4 percent at 4,086.83.

The narrower Dow has recovered from an initial move to the downside and has been lingering near the unchanged. The blue chip index is currently up 0.26 points or less than a tenth of a percent at 33,485.55.

The weakness on Wall Street partly reflected ongoing concerns about the outlook for the economy and interest rates following last week’s monthly jobs report.

The Labor Department’s closely watched report, which was released while the markets were closed for Good Friday, showed employment in the U.S. increased roughly in line with economist estimates in the month of March.

The report said non-farm payroll employment climbed by 236,000 jobs in March after jumping by an upwardly revised 326,000 jobs in February.

Economists had expected employment to rise by about 240,000 jobs compared to the addition of 311,000 jobs originally reported for the previous month.

Meanwhile, the Labor Department said the unemployment rate edged down to 3.5 percent in March from 3.6 percent in February. The unemployment rate was expected to be unchanged.

On the heels of the report, CME Group’s FedWatch Tool is currently indicating a 65.7 percent chance the Federal Reserve will raise interest rates by a quarter point next week.

Traders are also looking ahead to key inflation data later in the week along with reports on retail sales and industrial production as well as the minutes of the latest Federal Reserve meeting.

“Stocks are weakening as investors are anticipating the next inflation report will seal the deal for another quarter-point rate hike by the Fed,” said Edward Moya, senior market analyst at OANDA.

He added, “This is the week that could tell us that the US consumer is no longer showing resilience and in fact is rather weak; core inflation is making things more expensive, retail sales might show the consumer is tapped out, and the banks might paint a picture that American savings accounts are down and credit card debt is skyrocketing.”

Biotechnology stocks have shown a significant move to the downside on the day, dragging the NYSE Arca Biotechnology Index down by 1.4 percent.

Considerable weakness is also visible among software stocks, as reflected by the 1.2 percent drop by the Dow Jones U.S. Software Index.

Gold stocks have also come under pressure amid a steep drop by the price of the precious metal, while steel, energy and computer hardware stocks have moved notably higher.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan’s Nikkei 225 Index rose by 0.4 percent, while China’s Shanghai Composite Index fell by 0.4 percent.

Meanwhile, the major European markets remain closed on the day in observance of Easter Monday.

In the bond market, treasuries are extending the downward move seen in an abbreviated session last Friday. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3.4 basis points at 3.417 percent.

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