US stocks fall as tech, rate-cut doubts creep in

Live3 updates

• Tue, March 5, 2024 at 4:15 PM GMT+1

  The macro setup and election season

  It’s a day likely to be full of Super Tuesday analysis from various market pundits and other experts.

  So why not join in the fun here at Yahoo Finance.

  A good note from one of my favorite economists Michael Schumacher over at Wells Fargo just crossed my inbox. I found it helpful to see how he is thinking through potential market moves months before the election, with a specific focus on fiscal and monetary policy.

  Schumacher’s thoughts.

  Republican Sweep

  “In our opinion, a Republican sweep is the scenario that would cause the biggest increase in the deficit and Treasury’s financing need after 2025. We expect easier fiscal policy under a Trump administration, especially if Republicans gain control of Congress. President Trump quite likely would want to extend, if not expand, his previous tax cuts. We expect this scenario to have the largest impact on Treasury term premium and the yield curve (e.g. 5s/30s). As we noted previously, the curve probably will steepen if Trump wins big over the next few weeks and a Republican sweep becomes increasingly likely.”

  Democratic Sweep

  “This scenario also seems quite likely to involve a larger deficit and steeper Treasury curve, but by a smaller margin than in a Republican sweep. Our economists say “Even if Democrats sweep on Election Day, we doubt they would allow the TCJA to completely expire as scheduled”. Tax rates could conceivably rise even more for top income earners. Furthermore, corporate income tax increases are also more likely in this scenario. Although some of the individual income tax provisions are likely to expire as planned we expect more meaningful spending packages to accompany the expiration of the tax cuts.”

• 

  Tue, March 5, 2024 at 3:32 PM GMT+1

  Stocks pull further back from record highs

  US stocks slipped on Tuesday, once again retreating from record highs.

  At the opening bell, the S&P 500 (^GSPC) slid 0.4%, while the Dow Jones Industrial Average (^DJI) moved about 0.3% lower after a losing start to the week. Contracts on the tech-heavy Nasdaq Composite (^IXIC) sank roughly 0.8% amid continued drags from Apple (AAPL) and Tesla (TSLA).

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  Tue, March 5, 2024 at 1:30 PM GMT+1

  It’s Super Tuesday, Target’s CEO mentions the word election

  Super Tuesday is unlikely to move markets.

  Totally get it, besides there is a lot more happening this week in markets from wild moves in bitcoin to the slide in Tesla’s (TSLA) stock.

  But at some point this year, what’s shaping up to be a contentious US presidential election will move markets. That’s why I am banking comments on the election from top leaders today in order to help guide investors through the murky waters months from now.

  Target (TGT) chairman and CEO Brian Cornell — who I last physically saw inside the White House a few months ago before a meeting with the Biden administration —didn’t give me a lot on his macro views on Super Tuesday. He did give me just enough in a phone chat, however, to begin thinking how the consumer stock trade may act in the months before November.

  Here’s what he told me:

  “We’re watching it [the election] like you are, really carefully. We’ve looked at past trends during election years. I think that it makes sure we bring that little bit of joy to the guests during uncertain times. Make sure we make Target a special place for them to shop, filled with relevant product and great value. But we know they’re still going to consume, and we want to be a destination during what could be a very challenging and uncertain period of time.”