Stocks waver on Wall Street on first day of trading in May

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New York – Stocks are off to a mixed start for May following a brutal April in which widespread technology sell-offs dragged down major benchmarks. The S&P 500 was drifting between small gains and losses in the early going Monday, as was the Dow Jones Industrial Average. The Nasdaq was up 0.4%.

Markets are expecting an extra-large interest rate increase this week from the Federal Reserve as it tries to tame inflation, which is at its highest level in four decades.

Bond yields continued to climb. The yield on the 10-year Treasury note rose to 2.97%.

Crude oil prices fell 4% – losing nearly $4 a barrel – with European energy ministers set to meet to discuss Russian supply issues and sanctions.

Trading was closed for a holiday in China as well as many other Asian markets, and Britain.

The CAC 40 in Paris dropped 2% in midday trading and Germany’s DAX was down 1.3%.

Anxious traders await another expected rate hike this week from the Federal Reserve as it tries to tame four-decade high inflation. Another round of rate hikes will further increase borrowing costs across the board for people buying cars, using credit cards and taking out mortgages to buy homes.

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On Friday, steep losses for technology stocks pushed the S&P 500 down 3.6% while the tech-heavy Nasdaq Composite fell 4%, finishing April down 13.3% in its biggest monthly loss since 2008.

The Dow Jones Industrial Average dropped 2.8% and the Russell 2000 slid 2.8%.

“The reality is that sentiment around equity risk is horrible: and Bull/Bear reading shows bulls have never been worse off,” Stephen Innes of SPI Asset Management said in a commentary.

“As a result, we are in an incredibly fragile market that is delivering outsized moves on shallow levels of liquidity – especially in Tech, where growth is getting slammed,” Innes said.

Investors also have been reviewing financial results from big tech companies, industrial firms and retailers and some disappointing results or outlooks from Apple, Google’s parent company and Amazon helped fuel the selling last week.

A report showing pandemic lockdowns have hurt factory activity in China, a main regional driver of growth, was a fresh source of concern.

The monthly purchasing managers’ index, released over the weekend by China’s National Bureau of Statistics, fell to 47.4 in April, down from 49.5 in March on a 100-point scale. Numbers below 50 show activity contracting.

The COVID-19 outbreaks have impacted China’s factory activities and market demand, said the bureau’s statistician Zhao Qinghe.

Some enterprises have reduced or stopped production, with disruptions in logistics as well as the supply or raw materials and components.

Residents of Shanghai, China’s most populous city, spent most of April under lockdown. The capital, Beijing, is mass-testing millions of residents.

Japan’s benchmark Nikkei 225 declined 0.1% to finish at 26,818.53. Tokyo trading will be closed Tuesday through Thursday for national holidays, reopening on Friday.

Australia’s S&P/ASX 200 dropped 1.2% to 7,347.00. South Korea’s Kospi shed 0.3% to 2,687.45.

EU energy ministers were to meet to discuss Russia’s decision to cut gas supplies to Bulgaria and Poland and debate a sixth round of sanctions over Moscow’s war on Ukraine.

The energy ministers were also planning to look at what steps to take if Russia ramps up its pressure by cutting gas supplies to other countries.

Ahead of the meeting, benchmark U.S. crude lost $3.87 to $100.82 a barrel in electronic trading on the New York Mercantile Exchange. It shed 67 cents to $104.69 per barrel on Friday.

Brent crude, the international standard, fell $3.52 to $103.62 a barrel.

In currency trading, the U.S. dollar edged down to 129.70 Japanese yen from 129.83 yen. The euro cost $1.0527, inching down from $1.0546.