NEW YORK, April 8 (Xinhua) -- U.S. stocks ended little changed on Monday, as traders focus on upcoming inflation data this week, which could lead to reassessments of the probability of multiple interest-rate cuts in the coming months.
The Dow Jones Industrial Average fell by 11.24 points, or 0.03 percent, to 38,892.8. The S&P 500 sank 1.95 points, or 0.04 percent, to 5,202.39. The Nasdaq Composite Index increased by 5.43 points, or 0.03 percent, to 16,253.95.
Six of the 11 primary S&P 500 sectors ended in red, with energy and health leading the laggards by losing 0.63 percent and 0.38 percent, respectively. Meanwhile, real estate and consumer discretionary led the gainers by rising 0.82 percent and 0.75 percent, respectively.
Wells Fargo increased its year-end target for the U.S. benchmark S&P 500 index to 5,535 on Monday, the highest target among Wall Street brokerages.
This adjustment is based on optimism surrounding artificial intelligence and the possibility of reduced borrowing costs. The S&P 500 has already risen 9 percent this year, driven in part by anticipated interest rate cuts and heightened investor enthusiasm for the AI sector. "The bull market, AI's secular growth story, and index concentration have shifted investors' attention away from traditional valuation measures and toward longer-term growth and discounting metrics," Wells Fargo said in a note.
However, out of 15 other Wall Street price targets, the consensus predicts that the broad-market index will end the year at 5,062, representing a 2 percent decrease from the current level. Among these analysts, seven anticipate a decline in the S&P 500, with price targets ranging from JPMorgan's 4,200 to Oppenheimer's 5,500.
Recent data indicating a rebound in manufacturing activity and some indications of inflation picking up are among the factors suggesting an upcoming slowdown in the market, as noted by Torsten Slok, the chief economist at Apollo Global Management. "This repricing of rates, I think, is very important because it is telling you that we've been waiting for this slowdown for so long. Why isn't everyone expecting this rate slowdown to come in the next several quarters, in particular with the tailwind of the stock market up 10 trillion dollars since the November FOMC meeting?" Slok said earlier Monday. "We have a dramatic tailwind to consumption and to capex over the coming quarters that will continue to support inflation to the upside."
Investors are now eagerly awaiting March's consumer and producer price index (CPI) readings later this week to assess the Federal Reserve's success in combating inflation. The March CPI data, in particular, is closely watched as an indicator of when the central bank might start reducing interest rates.
