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Equities Rise Intraday, Oil Jumps as Markets Montior Middle East Developments

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Equities Rise Intraday, Oil Jumps as Markets Montior Middle East Developments

US benchmark equity indexes were higher intraday as traders appeared to shake off worries about the Middle East conflict and higher oil prices.

The S&P 500 was up 0.3% at 7,421.2 after midday Monday, while the Dow Jones Industrial Average and the Nasdaq Composite rose 0.2% each to 49,691.7 and 26,308.6, respectively. Among sectors, energy paced the gainers, while communication services saw biggest drop.

West Texas Intermediate crude jumped 3.7% to $98.98 a barrel, while Brent advanced 3.5% to $104.87, as US President Donald Trump rejected Iran's counteroffer to end the war, extending uncertainty around oil flows through the Strait of Hormuz.

The US-Iran ceasefire is on "massive life support" and "unbelievably weak," news outlets reported Monday, citing Trump. On Sunday, Trump described Iran's response to Washington's peace proposal as "totally unacceptable."

Iran's proposal, delivered via mediator Pakistan, sought an immediate end to hostilities, the lifting of the US naval blockade of its ports and assurances against further aggression, BBC News reported, citing Iran's semi-official Tasnim news agency.

"While optimism for an imminent deal is fading, there remains a glimmer of hope that talks between Trump and Chinese President Xi (Jinping) later this week could yield positive results on Iran," ING Bank said in a note Monday.

Trump is scheduled to arrive in China Wednesday for a high-stakes state visit, with talks set to take place Thursday and Friday.

US Treasury yields were higher intraday Monday, with the 10-year rate up 4.7 basis points at 4.41% and the two-year rate rising 4.2 basis points to 3.94%.

In company news, some big technology names were advancing, with Nvidia (NVDA) up 2.6%, the second-biggest gainer on the Dow. Micron (MU) and Qualcomm (QCOM) also saw sizable gains.

Some 89% of S&P 500 companies have reported quarterly results in the latest cycle, with earnings up about 25% from a year earlier and revenue rising 10%, Oppenheimer Asset Management said in a note. Ahead of the earnings season, FactSet put expected earnings growth at 12.6% year over year.

Cisco Systems (CSCO) and Applied Materials (AMAT) are among the major names scheduled to report this week.

Lumentum (LITE) shares surged 17% intraday Monday, the top gainer on the S&P 500, after the company said it is set to join the Nasdaq-100 index, effective May 18.

Trade Desk (TTD) shares were down 7.1%, the worst performer on the S&P 500, after HSBC downgraded the stock to reduce from hold while adjusting its price target to $20 from $31.

In economic news, US existing home sales increased less than projected in April, data from the National Association of Realtors showed.

"Despite mixed macroeconomic signals -- including a record-high stock market and historically low consumer confidence -- home sales were modestly boosted by the continued improvement in housing affordability," NAR Chief Economist Lawrence Yun said.

Gold was down 0.2% at $4,722.50 per troy ounce, while silver jumped 6.2% to $85.90 per ounce.

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Gold Recent Underperformance Will Likely Prove to be Temporary, ING Says
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Gold Recent Underperformance Will Likely Prove to be Temporary, ING Says

Gold's recent underperformance should prove to be temporary, with the yellow metal expected to hit $5,000 per troy ounce by the end of the year, ING Bank said in a note Monday.Gold has fallen about 12% since the Iran war began on Feb. 28, ING said. Bullion futures were last trading little changed at $4,732 per ounce on Monday.Gold is widely perceived as a safe haven that tends to shine in a financial crisis or growth shock. Hence, the yellow metal's recent decline may have come across as "a counterintuitive move," ING Commodities Strategist Ewa Manthey said in a note.But the sell-off reflects macro consequences of the Middle East conflict, rather than "a breakdown in gold's safe-haven role," Manthey said.ING remains constructive on gold, anticipating a rebound in bullion prices to $5,000 by year-end."Gold's safe-haven role is not in question," Manthey said. "Recent months have shown that short-term price action can still be dominated by macro forces -- particularly real yields, the dollar and expectations for (Federal Reserve) policy. Once those headwinds begin to ease, gold's underlying support should reassert itself."Gold prices generally have a positive correlation with inflation and an inverse relationship with interest rates and the dollar index.Inflation has re-accelerated in the aftermath of the US-Israel war with Iran that has disrupted shipments through the Strait of Hormuz and sent energy prices higher. These dynamics have weakened the case for near-term monetary policy easing, Manthey said."Higher oil prices push inflation up, keep (central bank demand) on hold and strengthen the dollar, all of which weigh on gold," she said. "High liquidity also makes it a source of funds when investors need to cover losses elsewhere."The Fed left its policy rate unchanged in April, saying the Middle East conflict was fueling uncertainty around the US economic outlook."Our US economist still expects easing in the second half of the year, but a prolonged energy shock could push that back," Manthey wrote. "Real yields and the dollar remain the key constraints on gold."President Donald Trump on Sunday rejected Iran's counter offer to end the war, dimming prospects of an imminent deal between the two sides."The setback keeps the (US-Iran) ceasefire timeline uncertain and inflation risks elevated -- reinforcing the higher-for-longer rate narrative that has weighed on gold throughout the conflict," Manthey said. "A durable resolution remains the key catalyst for a sustained gold recovery."

S&P 500 Companies' Quarterly Profit Growth Slows, But Remains Strong, Oppenheimer Says
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S&P 500 Companies' Quarterly Profit Growth Slows, But Remains Strong, Oppenheimer Says

S&P 500 companies' quarterly earnings growth slowed compared with figures from a week ago, but remained well ahead of Wall Street's expectations heading into the reporting season, Oppenheimer Asset Management said Monday.Some 89% of companies in the benchmark equity index have reported results in the latest cycle, with earnings up about 25% from a year earlier and revenue rising 10%.Last week's report by the brokerage showed profit and revenue growth at about 28% and 11%, respectively, based on financials reported by 63% of the index constituents.Ahead of the earnings season, FactSet put expected earnings growth at 12.6% from a year earlier, Oppenheimer Asset Management Chief Investment Strategist John Stoltzfus said.Among sectors, consumer discretionary and communication services outperformed in terms of earnings, with profits up by about 48% and 47% year over year, respectively. Technology led the chart for revenue growth, with a 23% increase, followed by communication services' 15% jump.Nine S&P 500 companies are scheduled to report results this week, Stoltzfus said. They include Cisco Systems (CSCO) and Applied Materials (AMAT).On Friday, the S&P 500 and the Nasdaq Composite reached new all-time highs, marking the sixth consecutive weekly advance for both indexes.US President Donald Trump on Sunday rejected an Iranian counterproposal to end the war, extending uncertainty around oil flows through the Strait of Hormuz."Notwithstanding the recent powerful rallies in stocks driven by earnings growth and better than expected US economic data over the past week, challenges remain to finding resolution to the conflict in the Middle East," Stoltzfus said. "That conflict, in our view remains as a potential negative overhang to market performance. In addition, the high price of oil and supply chain disruptions add to inflation risks near term."Price: $97.67, Change: $+1.10, Percent Change: +1.14%

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April Existing-Home Sales Rise Less Than Expected, NAR Data Show
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April Existing-Home Sales Rise Less Than Expected, NAR Data Show

US existing home sales increased less than projected in April even as affordability continued to improve, data from the National Association of Realtors showed Monday.Sales edged up 0.2% sequentially to a seasonally adjusted annual rate of 4.02 million units last month. The consensus was for a 2% increase in a survey compiled by Bloomberg. Sales grew in the Midwest and South, but were unchanged in the Northeast. The West saw a decline."Despite mixed macroeconomic signals -- including a record-high stock market and historically low consumer confidence -- home sales were modestly boosted by the continued improvement in housing affordability," NAR Chief Economist Lawrence Yun said.Last week, a survey by the University of Michigan showed that US consumer sentiment continued to fall in May as cost pressures tied to the Middle East conflict sent the measure tumbling to all-time lows.The average 30-year fixed-rate mortgage increased to 6.33% last month from 6.18% in March, but was down from 6.73% a year earlier, the NAR said Monday, citing Freddie Mac data. "Mortgage rates are lower from a year ago, and average income growth is outpacing home price gains," Yun said.Single-family home sales were unchanged month over month at 3.64 million units in April, while condominium and co-op sales increased 2.7% to 380,000 units, NAR data showed."Inventory still remains tight," Yun said. "At the same time, days on market are lengthening on average, implying that consumers are taking their time before making decisions."The median sales price of existing homes increased 0.9% year over year to $417,700 in April, marking the 34th straight month of annual gains, according to the report.The increase in prices last month was in line with seasonal patterns, with the rise expected to continue in May and June, Jefferies Chief US Economist Thomas Simons said in a note e-mailed to. Although recent efforts by the Trump administration to lower rates through purchases of mortgages may help improve buying conditions later in 2026, "it will take time for this to meaningfully impact the market," Simons wrote.