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Stock Market Today: May 16, 2023

May 16, 2023

Ahead of the opening bell, U.S. stock futures are pointing to a negative start for today’s session. In overnight trading, markets in Asia were mixed. Meanwhile, the major European indexes are up slightly. Elsewhere, oil prices have edged up, with West Texas Intermediate (WTI) ahead by about 0.3%, to around $71.30 a barrel.

Investors and traders are getting increasingly worried about whether the nation’s debt ceiling will be raised in a timely manner. According to Treasury Secretary Janet Yellen, the U.S. could default on its obligations as early as the first of June, resulting in an “economic catastrophe”. The White House and Congressional leadership are scheduled to meet today to discuss the matter. While it is highly unlikely that the debt ceiling won’t be raised (as the global economic fallout would be enormous), there will probably be much political wrangling before a deal is struck. And, with next year’s Presidential election approaching fast, how the negotiations are handled could play a major role in determining which party occupies the White House in 2025. As such, Wall Street, which doesn’t like uncertainty, will be prone to some heightened volatility.

On the economic front, this morning’s report from the U.S. Census Bureau indicated that retail sales for April were up 0.4%, versus declines in the prior two months. Market watchers were calling for an increase of 0.8%. For the 12-month period, total sales advanced 3.1%. Tomorrow morning brings the April figures for housing starts, with the consensus calling for a modest decline compared to March. The number of building permits (a more forward-looking indicator) for last month will also be reported. There, a slight increase is expected compared to the March tally. These will be followed on Thursday with existing home sales totals for April. The Street is calling for a decline of about 180,000 units compared to March, to an annualized rate of 4.26 million.

Stocks ended Monday’s session in the plus column, with the Dow Jones Industrials rising 47 points (0.1%) to end a five-session losing streak. Meanwhile, the S&P 500 moved ahead by 12 points (0.3%), and the tech-focused NASDAQ gained 80 points (0.7%).

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.

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