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Wall Street stocks opened the week on a cautious note, starting Monday’s session lower ahead a key inflation report and earnings news, and as Twitter’s legal battle with Elon Musk begins.
The social media network is planning to fight Musk, to oblige him to go through with the $44 billion takeover, after the Tesla chief said he was pulling out, accusing Twitter of failing to provide complete information on “bot” accounts.
Investors remain on edge about the US and global economic outlook, as new Covid variants threaten to cause more lockdowns in Asia, and as they prepare for the flood of corporate profit reports for the quarter.
With the Federal Reserve aggressively raising interest rates to cool the highest inflation in more than 40 years, all eyes will be on Wednesday’s consumer price index data for June for signs of any relief.
The surprisingly-strong jobs data for June released Friday, offered a picture of a solid economy potentially able to weather higher borrowing costs, as well as a modest easing of wage pressures.
But the war in Ukraine and Covid remain question marks, and equities have been falling for weeks.
“There are a lot of things to cope with right now. And of course, the market doesn’t like uncertainty,” said Maris Ogg of Tower Bridge Advisors.
“So it’s nice to get a rally here and there, but it doesn’t look like the long-term trend has changed,” Ogg told AFP.
About 20 minutes into the trading session, the Dow Jones Industrial Average had dropped 0.6 percent to 31,162.32.
The broad-based S&P 500 fell 1.2 percent to 3,852.12, while the tech-rich Nasdaq Composite Index dropped 2.1 percent to 11,395.27, after five days of steady gains last week.
Twitter dropped 7.5 percent after news Musk has scrapped his deal, and media reports said the company has hired prominent New York law firm Wachtell, Lipton, Rosen & Katz to fight his decision.
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