New highs for S&P and Nasdaq

Nathan Ring, CFO of Knife River Corporation rings the bell on the trading floor of the New York Stock on June 1, 2023 in New York City.

Spencer Platt | Getty Images News | Getty Images

This report comes from today’s CNBC Daily Open, our new newsletter for international markets. CNBC Daily Open gives investors everything they need to know, no matter where they are. Do you like what you see? Here you can sign up.

What you need to know today

  • US stocks ended slightly higher on Tuesday as investors held back with big moves ahead of next week’s Federal Reserve monetary policy meeting. European markets also traded higher. Germany’s DAX index rose 0.18% even though the country’s manufacturing sector unexpectedly fell 0.4% in April.
  • The World Bank estimates that advanced economies will grow by just 0.7% in 2023, compared to 2.6% last year. On the bright side, the institution expects emerging and developing economies to grow 4%, up 0.6% from its January forecast.
  • Sequoia Capital, one of the world’s largest venture capital firms, announced that due to an “increasingly complex” dynamic, it will split into three separate and independent entities. One will focus on the US and Europe; another about China; and the last about Southeast Asia and India.
  • PROFESSIONAL Jeffrey Gundlach, The CEO of DoubleLine Capital said the US appears to be heading for a recession. In such circumstances, the traditional 60-40 portfolio doesn’t work – instead, this is the portfolio mix that Gundlach prefers.

The final result

Despite yesterday’s tumbles in some big-name stocks, markets managed to rally higher as the uncertainty of the past few weeks eased.

Apple Shares fell 0.2% as investors digested information about the tech giant’s new mixed-reality headset. While that’s a small loss overall, it’s the first time since 2016 that the tech giant’s shares have fallen a day after its Worldwide Developers Conference, reflecting uncertainty about the attractiveness of the $3,499 Vision Pro.

Still, analysts like companies Goldman Sachs And JP Morgan remain optimistic about Apple. “While Vision Pro may not drive significant volumes due to its premium price point, it could be the potential catalyst for the AR/VR market,” said JPMorgan analyst Samik Chatterjee.

Elsewhere, Boeing Shares fell slightly 0.7% after the company said it would delay deliveries of its 787 Dreamliner aircraft due to a new defect, while Coinbase plunged by double digits.

Still, investors were not worried. The CBOE Volatility Indexnormally viewed as a fear gauge on Wall Street, fell to 13.96 yesterday, closing below 14 for the first time since February 2020 – just before the pandemic hit everyone.

The major indices also had a positive day. The S&P 500 Soared 0.24%, the highest close since August – and BMO Capital Markets thinks the broad-based index could continue higher and break the 4,500 mark. The Nasdaq Composite The increase increased by 0.36% and thus reached a high for the year. The Dow Jones Industrial Average was flat.

However, it should be noted that trading volume was below average yesterday. Investors are taking a breather from last week’s frantic tech rally – not a bad idea considering that next week’s upcoming Fed meeting has the potential to turn interest rate expectations upside down yet again.

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