Enzolytics Inc (ENZC)

[falon]

UPDATE: U.S. stocks slip as economic data disappoints and bond yields spike
Today 10:20 AM ET (MarketWatch)Print
By Mark DeCambre

U.S. stocks slipped Wednesday morning, led by technology stocks, after weaker-than-expected economic data suggested a more tepid rebound from the COVID-19 pandemic, and as bond yields resumed their upward climb.

How are stock benchmarks performing?

On Tuesday (https://www.marketwatch.com/story/u-s-stock-market-set-to-take-breather-after-best-one-day-rally-in-months-11614688222?mod=market-snapshot), the Dow fell 143.99 points, or 0.5%, to 31,391.52, the S&P 500 slid 31.53 points, or 0.8%, to 3,870.29, while the Nasdaq Composite Index dropped 230.04 points, or 1.7%, to 13,358.79.

What's driving the market?

Markets struck an upbeat tone before the start of Wednesday trade after President Joe Biden said late Tuesday (https://www.marketwatch.com/story/biden-moves-forward-his-timeline-for-when-all-adults-can-be-vaccinated-now-mid-may-01614721386)that the U.S. would have enough COVID-19 vaccines for all Americans adults by the end of May, as he announced that the White House brokered a partnership between Merck & Co. (MRK), and Johnson & Johnson (JNJ) to distribute J&J's one-dose vaccination.

The seven-day average of COVID-19 vaccine doses administered in the U.S. recently hit 1.8 million a day (https://www.wsj.com/livecoverage/covid-2021-03-02?mod=article_inline), the Wall Street Journal reported, based on analysis of Centers for Disease Control and Prevention data. More than 50 million Americans have received at least one dose of a vaccine, representing about 15.3% of the population, according to the CDC. Meanwhile, the U.S. has averaged 65,468 cases a day in the past week, down 19% from two weeks ago (https://www.marketwatch.com/story/coronavirus-tally-global-cases-of-covid-19-top-1148-million-and-us-death-toll-above-516000-2021-03-03).

However, Texas and Mississippi said that would they end mask mandates and reopen businesses (https://www.marketwatch.com/story/despite-advice-from-scientists-and-politicians-texas-gov-greg-abbott-will-lift-covid-19-mask-mandate-01614717673), despite recommendations for caution from public-health professionals, including the CDC, which has warned against complacency.

Separately, Washington lawmakers hashed over a further round of COVID aid, with Democrats negotiating the terms of Biden's $1.9 trillion relief package. That's likely to add to the deluge of government bond issuance.

Investor anxieties have centered on moves in the bond market over the past two weeks, with attention trained on moves in the benchmark 10-year Treasury yield.

"The pace of the rise in interest rates was a bit worrisome," said Will Geisdorf, senior research analyst with Sarasota, Florida-based Allegiant Private Advisors. "I think the market is still kind of digesting that."

Right now, investors are most interested in the question of re-opening the economy, Geisdorf told MarketWatch. Any economic boost from more fiscal aid is already price into the market, he thinks, so the real question becomes, "how quickly do things open back up and how well do we suppress further spread?"

For now, Geisdorf thinks we're in "a pause in the reflation trade. I think rates move higher and stocks can move higher with rates. That's why you've seen the back and forth over the past few weeks."

Federal Reserve Gov. Lael Brainard on Tuesday said that she wasn't concerned about the move in yields, which have weighed on stocks because they imply higher borrowing costs for corporations and individuals, but she did note that she was "paying close attention to market developments (https://www.marketwatch.com/story/feds-brainard-expects-burst-of-inflation-this-year-that-wont-last-11614708031?mod=the-fed).";

Brainard said that the economy could see a burst in inflation but said that any such rise would be transitory and due to bottlenecks of supply against a surge in demand as the economy attempts to normalize from social-distancing protocols.

Meanwhile in U.S. economic data, ADP's private-payroll data for February showed 117,000 jobs (https://www.marketwatch.com/story/u-s-private-payrolls-increased-by-sluggish-117-000-in-february-adp-says-11614778023?mod=mw_latestnews)were created in the month, below the 225,000 forecast from economists polled by Dow Jones, and compared with a revised 195,000 in January. The ADP data come ahead of the more closely followed nonfarm-payrolls report due on Friday from the U.S. Labor Department.

The IHS Markit US services sector purchasing managers index rose to 59.8 in February, up from 58.3 in January and above the earlier 'flash' figure of 58.9. However, the Institute of Supply Management non-manufacturing sector index fell to 55.3 from 58.7.

The Beige Book, the Fed's report on business conditions in its districts, will be released at 2 p.m.

Meanwhile, a number of Fed speakers are set to talk Wednesday, including Philadelphia Fed President Patrick Harker at 10 a.m., Atlanta Fed President Raphael Bostic at noon and Chicago Fed President Charles Evans at 2 p.m.