Markets pause following record highs last week

Dow crawled up only 12 after a strong opening, decliners over advancers about 3-2 & NAZ added 17.  The MLP index was steady in the 274s & the REIT index was off 2+ to 377.  Junk bond funds slid lower & Treasuries had limited selling which increased yields (more below).  Oil was bid higher in the 76s & gold fell 11 to 2037.

AMJ (Alerian MLP Index tracking fund)

The blue-chip stock index is getting a shakeup this week that will make its roster look more modern & potentially help reverse its recent underperformance. Today, Amazon (AMZN) officially becomes a member of the Dow Jones Industrial Average, replacing Walgreens Boots Alliance (WBA).  Shares of the dominant e-commerce platform have surged more than 80% over the past year, making it one of several large stocks that have powered the S&P 500 to new highs while the Dow has struggled to keep up.  The Dow is a smaller average than the S&P 500, with just 30 components, & it's weighted by the share price of the individual stocks rather than the companies' total market value.  That makes some investors view the Dow, begun in May 1896, as a poor representation of the American stock market.  And as technology has become a larger part of the US economy & market over the past 2 decades, the industrial-heavy Dow has perpetually been playing catch-up in gaining more exposure to the fastest growing companies.  The 3 largest tech stocks in the Dow by market cap as of Fri were Apple (AAPL),  Microsoft (MSFT) & Salesforce (CRM).  AMZN is officially a consumer discretionary stock, according to a commonly followed classification system, but it is broadly accepted as a tech giant & its addition will help chip away at the gap between the Dow & the S&P.   AMZN stock was up 3 pennies.

Amazon joins the Dow Monday, giving the 127-year old index a needed upgrade as it trails the S&P 500

Treasury yields declined as investors awaited key economic data set to be published this week which could provide hints about the outlook for interest rates & the state of the economy.  The yield on the 10-year Treasury was less than 1 basis points lower to 4.258% & the 2-year Treasury  yield was last up nearly 2 basis points at 4.705%.  Yields & prices have an inverted relationship & 1 basis point equals 0.01%.  Investors looked ahead to economic data due this week, some of which could inform the Federal Reserve's decisions on interest rate policy.  This includes the Fed's favored inflation gauge, the personal consumption expenditures price index, which is slated for Thurs.  Fed officials have in recent weeks repeatedly said they are looking to data for more evidence that inflation is moving toward the 2% target to become more confident about cutting interest rates.  Both the latest consumer price index & producer price index readings came in higher than expected, prompting concerns about how long it will take for inflation to ease & whether this means interest rates could stay higher for longer than previously hoped.  Markets were last widely expecting the first interest rate cut to take place in Jun.  Other key data this week includes updated GDP figures on Wed.  Questions about whether the economy will be able to avoid a recession as rates remain elevated have been rife among investors.

U.S. Treasury yields fall as investors look ahead to key economic data this week

Intuitive Machines' (LUNR) cargo lander, Odysseus, returned its first images from the moon's surface over the weekend, as the spacecraft settles in to its lunar destination.  The company’s historic IM-1 mission is now operating on the moon after landing on Thurs, becoming the first privately developed spacecraft to soft land on the lunar surface.  LUNR initially reported Odysseus was standing upright.  But, in an update Friday, company execs said they believe the spacecraft caught its landing gear sideways in the moon's surface while touching down & tipped over.  Despite resting on its side, Odysseus is still sending back data.  LUNR expects Odysseus to operate until tomorrow, when its solar panels will no longer be exposed to the sun.  The Odysseus lander carried 12 gov & commercial payloads, 6 of which are for NASA under a $118M contract thru the agency's Commercial Lunar Payload Services (CLPS) initiative.  NASA leadership emphasized the IM-1 mission was still successful despite the spacecraft tipping over, calling the landing “a gigantic accomplishment.”  LUNR stock is volatile stock & fell 2.81 (29%)

Lunar landing photos: Intuitive Machines’ Odysseus sends back first images from the moon

Some traders may be away & spending some of their profits made last week.  Thoughts about lingering relatively high interest rates & how they will affect the economy are common.

 Dow Jones Industrials