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Stocks Edge Lower As Momentum Fades Amid Recession Concerns

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Stocks Edge Lower As Momentum Fades Amid Recession Concerns

Updated at 9:01AM ET

U.S. stock futures edged lower on Monday, while U.S. Treasury yields edged higher and the dollar held near two-year highs against the rest of the world as stocks struggled to extend Friday’s late rally into the new trading week.

That could be difficult, however, as investors continue to worry that the twin effects of soaring inflation and aggressive central bank rate hikes will collectively cripple growth in the U.S. and elsewhere, while China’s “virus-free” health policy is already threatening a U.S. recession. the world’s second-largest economy.

In fact, official data from Beijing today showed retail sales fell 11.1% in April and industrial output fell nearly 3% as lockdowns hit demand and shut factories across the country.

In the U.S., consumer confidence is at its lowest in more than a decade, gasoline prices hit record highs and food bills soar, which have combined to reduce spending and slow growth, ex-Goldman Sachs Group (GS) – Access to Goldman Sachs Group Reports CEO Lloyd Blankfein warned Sunday on CBS’ “Face the Nation”: “If I were running a big company, I would be well prepared for it. …If I were a consumer, I would be prepared for that.”

The strength of the U.S. consumer will be in focus on Wall Street this week as a raft of data releases and corporate earnings are concentrated in the largest and most important subsector of the U.S. economy.

April retail sales figures released on Tuesday may be the starkest assessment of the impact of soaring inflation and record oil prices on domestic consumers, with economists expecting a significant slowdown in core sales to lead to a sharp rise in the headline figure, thanks to gasoline Higher dollar value of the sale.

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retail leader Walmart (WMT) – Get the Walmart Company ReportThe Home Depot (HD) – Get Home Depot, Inc. ReportTarget (TGT) – Get Target Company Report and Lowe’s (LOW) – Get the Lowe’s Companies, Inc. report Profits at S&P 500 companies are expected to rise 11.1% from last year to $407.5 billion as the first-quarter reporting season draws to a close, with March quarter earnings being released this week.

The Fed’s inflation fight, however, could offer what Blankfein calls a “narrow road” for a soft landing by Chairman Jerome Powell — who will open at 2 p.m. ET on Tuesday. :00 Speak at the Wall Street Journal’s “The Future of Everything” event – with a guide.

That may be why the yield on the benchmark 10-year Treasury note rose optimistically to 2.933% on Monday, even though stocks were still looking for at least a modest opening down.

Futures contracts tied to the Dow Jones Industrial Average showed a 5-point drop at the open, while futures contracts tied to the S&P 500, down 15.6% this year, were priced at 8 points lower. Nasdaq-linked futures are down 20 points.

Twitter (TWTR) – Get Twitter, Inc. reports Shares were the most active in premarket trading, extending their recent losses by about 1.75% after Tesla (TSLA) – Get Tesla Inc report Chief Executive Elon Musk said the social media group’s legal team told him he violated a nondisclosure agreement that could further delay his $44 billion takeover bid.

Meanwhile, Tesla shares edged down 0.12% after a report that the automaker will delay plans to return its Shanghai factory to full production amid the city’s ongoing coronavirus lockdown.

Spirit Airlines (Save) – Get the Spirit Airlines, Inc. report Soars 22.5% after JetBlue (JBLU) – Get JetBlue Airways Report Launched a hostile takeover bid for the low-cost airline, valued at about $3.2 billion.

McDonald’s (MCD) – Get the McDonald’s Corporation ReportMeanwhile, shares edged down 0.5% after it decided to permanently withdraw from the Russian market due to a humanitarian crisis linked to ongoing attacks in Ukraine, ending more than 30 years of business in the former Soviet Union.

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