Wall Street drifts, ASX set to dip

US stocks are drifting at the start of what will be a shortened trading week.

The S&P 500 was 0.2 per cent lower in afternoon trading. The Dow Jones was down 0.4 per cent and the Nasdaq composite was 0.1 per cent lower. The Australian sharemarket is set to dip, with futures at 4.54am AEDT pointing to a slide of 9 points, or 0.1 per cent, at the open. The ASX added 0.5 per cent on Monday.

The market is easing back from last week’s big run, which was its best of the year and sent all three indexes to records on Thursday. Stocks climbed as the Federal Reserve indicated it’s still likely to deliver several cuts to interest rates this year, as long as inflation keeps cooling.

That has the S&P 500 on track for another winning month in what’s been a nearly unstoppable run since late October. The strength has been durable, “but the longer the market goes up without a notable pullback, the closer we come to such a move taking place,” according to Chris Larkin, managing director, trading and investing at E-Trade from Morgan Stanley.

For the market to continue rallying, more companies will need to deliver strong earnings growth to justify high prices, say strategists at Morgan Stanley.

United Airlines was weighing on the market and lost 4.3 per cent. Federal regulators are increasing their oversight of the company following several recent issues, including a piece of the outer fuselage falling off one jet and a plane losing a tyre during takeoff.

Boeing was trimming some of its sharp losses for the year and rose 1.3 per cent. Beset by worries about its safety and quality of manufacturing, the plane maker announced a shakeup to its management. Among the moves is the departure of its CEO Dave Calhoun, set for the end of the year.

Wall Street is also preparing for the return of a stock trading under the ticker symbol “DJT,” the initials of former President Donald Trump. The company behind his Truth Social platform completed its merger with Digital World Acquisition Corp. after Digital World’s shareholders approved the deal on Friday.

The company’s stock jumped 23.7 per cent in what’s expected to be its last day trading under its ticker symbol of “DWAC.” On Tuesday, it will begin trading under “DJT,” which was used by Trump Hotels & Casino Resorts before it filed for Chapter 11 bankruptcy protection in 2004.