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Nasdaq up, Dow slips amidst J&J vaccine row as SPAC is back in news



U.S. stock futures were flat in overnight trading on Tuesday ahead of the first batch of corporate earnings.

Dow futures fell 30 points. S&P 500 futures dropped 0.06% and Nasdaq 100 futures dipped 0.06%.

The S&P 500 gained 0.3% to set a new record close at 4,141, and the Dow Jones Industrial Average finished slightly lower, off 0.2% to 33,677.

Stocks were largely mixed as the U.S. federal health officials ordered a pause in the Johnson & Johnson (JNJ) Covid vaccine rollout. Concerns arose over rare blood clots occurring in some people who received the vaccine.

While Johnson & Johnson fell more than 1% on the news, other vaccine makers such as Pfizer (PFE) and partner BioNTech (BNTX) rallied on the news.

The technology-heavy Nasdaq Composite was up more than 1% with shares of Amazon, Apple, Alphabet, Microsoft, Netflix, and Tesla all closing higher.

Meanwhile, investors digested a rise in the Labor Department’s consumer price index inflation gauge, which rose above expectations in March. It rose 0.6% for the month, above the 0.5% rise targeted by economists. This was also up from the 0.4% increase for February and the sharpest monthly gain since June 2009.

Core prices, minus food and energy, also rose above expectations, gaining 0.3%, which was triple February’s increase.

Investors are gearing up for the first wave of corporate earnings on Wednesday when  JPMorganGoldman Sachs, and Wells Fargo report before the bell. Bank stocks have risen sharply so far this year, with the KBW Bank Index easily outpacing the S&P 500. Analysts are expecting strong investment banking results but a slowdown in loan growth. Plus, loan reserve releases could spark high earnings numbers.

Market participants will also be watching for the Coinbase listing on Wednesday. Crypto investors are hailing the company’s stock market debut as a major milestone for the industry after years of skepticism from Wall Street and regulators. The price of bitcoin surged to a fresh record high of $63,707on Tuesday.

However, one of Tuesday’s biggest market headlines centered on a company located 9,000 miles away – which also continues to be an evolving concern for investors here at home.

Grab Holdings, a multinational ride-hailing, food delivery, and payments-solutions technology firm based in Singapore, announced it would go public via a $39.6 billion deal that would see it merge with California-based special purpose acquisition company Altimeter Growth (AGC, +9.9%) – the largest such “SPAC” deal in history.

That extends what has been an explosive 2021 for SPACs – a method of bringing private companies public without them having to go directly through the IPO process. After raising $13.6 billion in 2019, SPAC deals generated an incredible $73 billion in 2020 … only to be eclipsed in just the first three months of 2021, where nearly $88 billion has already been raised to date.

Investors need to exercise caution, as this newly red-hot corner of the market is garnering increasing scrutiny from regulators.



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