Here are the top news, trends, and analysis investors need to start their trading day:
1. The S&P 500 drops off after moving towards a record
The Wall Street sign can be seen near the New York Stock Exchange (NYSE) in New York City on May 4, 2021.
Brendan McDermid | Reuters
US stock futures were mostly lower on Thursday, and the 10-year Treasury yield was up over 1.6% after a morning economic data burst. The market posted modest gains on Wednesday, helped by stocks tied to the economic reopening. The S&P 500 ended less than 1% after its record close on May 7th. With two trading days remaining in May, the Nasdaq rose almost 2% over the course of the week, but rose 1.6% over the course of the month. The Dow Jones Industrial Average and S&P 500 rose for the week and month.
Acorns announced Thursday that it will merge with Pioneer Merger Corp., a publicly traded special-purpose acquisition company. The SPAC deal valued Acorns at around $ 2.2 billion, more than double the previous private valuation. When the transaction is complete, Acorns will trade on the Nasdaq under the symbol OAKS, a nod to the company’s motto and analogy of growing acorns into “mighty oaks.” Comcasts Venture Arm and NBCUniversal are investors in Acorns. Comcast also owns CNBC.
2. Three reports provide more insight into the economic recovery
The government released three key economic reports on Thursday morning, an hour before the opening bell on Wall Street.
- Initial jobless claims for last week fell more than expected to 406,000, another pandemic-era low compared to the unrevised 444,000 new claims the previous week.
- The second estimate of the gross domestic product in the first quarter remained constant with an annual growth rate of 6.4%. In the fourth quarter of 2020, GDP rose by 4.3%.
- Durable goods orders were down 1.3% in April. Economists had called for an increase of 0.9% after an upwardly corrected March plus of 1.3%.
3. The meme stock rally will pause after a month of comeback profits
SELINSGROVE, PENNSYLVANIA, UNITED STATES – 01/2021/27: A woman walks past the GameStop store in the Susquehanna Valley Mall. An online group sent GameStop (GME) and AMC Entertainment Holdings Inc. (AMC) share prices soaring to squeeze short sellers.
Photo by Paul Weaver / SOPA Images / LightRocket via Getty Images
This week’s meme stock rally should pause on Thursday. GameStop and AMC Entertainment stocks, popular with Reddit traders, were under pressure on the pre-market. However, GameStop rose nearly 16% on Wednesday alone and nearly 44% last month. AMC rose 19% on Wednesday and 70% last month. GameStop is up nearly 1,200% this year, including epic gains in January. AMC has grown 822% since the beginning of the year. Strategists attribute the recent surge in these stocks to overselling.
4. Round 2 for bank managers after fireworks at the hearing on Wednesday
Jamie Dimon, chairman of the board of directors of JPMorgan Chase & Co., speaks virtually on a laptop during a Senate Committee on Banking, Housing and Urban Affairs hearing held virtually on a laptop in Tiskilwa, Illinois, United States on Tuesday, May 25, 2021.
Daniel Acker | Bloomberg | Getty Images
The CEOs of the big banks are facing a second round of barbecue by the legislature, as they testify before the House Financial Services Committee. There were fireworks at Wednesday’s Senate Banking Committee hearing as progressive Senator Elizabeth Warren chased JPMorgan Chase’s Jamie Dimon. The Massachusetts Democrat called Dimon about the bank’s nearly $ 1.5 billion overdraft fees last year when borrowers struggled during Covid lockdowns. According to Dimon, JPMorgan waived overdraft fees for customers asking for relief. When asked if the bank would reimburse the fees to those who didn’t, Dimon said, “No.”
5. Biden orders a closer look at the origin of Covid, including a possible Wuhan lab leak
During the visit by the World Health Organization (WHO) team tasked with investigating the causes of coronavirus disease (COVID-19) in Wuhan, Hubei Province, China on February 3, 2021, security guards will be in front of the Wuhan Institute of Virology keep watch.
Thomas Peter | Reuters
President Joe Biden has ordered a closer scrutiny of the intelligence services, which he said are two equally plausible scenarios for the development of the coronavirus. Biden announced that earlier this year he asked the intelligence services to assess “whether it was human contact with an infected animal or a laboratory accident.” The hypothesis that the virus may have escaped a Chinese laboratory has grown in importance in recent months. CDC director Dr. Rochelle Walensky said in a Senate testimony last week that a lab leak origin was “a possibility”. China has rejected the laboratory theory.
– Reuters contributed to this report. Follow all market action like a pro on CNBC Pro. With CNBC’s coronavirus coverage, you’ll get the latest information on the pandemic.