U.S. consumer sentiment stays steady

This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

Wall Street gains
U.S. stocks ended higher on Monday as investors look ahead to monetary policy decision from the Federal Reserve. The S&P snapped a three-day losing streak to rise 0.63%, while the Dow gained 0.2%. The tech-heavy Nasdaq Composite also rose 0.82%. Markets in Asia are waiting for the Bank of Japan’s decision amid rising expectations that the world’s last negative rates policy is about to end. 

Nvidia’s new AI chips
Nvidia CEO Jensen Huang revealed a new generation of AI chips at the company’s developer’s conference in San Jose, where the chipmaker showcased its latest inroads in the technology. The new AI graphics processors called Blackwell are expected to ship later this year. The announcement comes as the chip giant aims to cement its dominance in the AI market. 

Aramco on energy transition
Saudi Aramco CEO Amin Nasser said the current energy transition strategy is failing and the world should give up on the idea of phasing out oil and gas. “Instead invest in them adequately reflecting realistic demand assumptions,” he suggested, as fossil fuel demand is forecast to continue rising in the years ahead.

BYD push into emerging markets
Chinese automaker BYD is aggressively expanding into emerging markets given policy uncertainty in the U.S. and Europe. In an effort to bolster sales, the company already has factories in Thailand, Brazil, Indonesia, Hungary and Uzbekistan — expanding into regions where the firm will likely face less political pushback. 

[PRO] Bullish on Palantir
Brian Stutland of Equity Armor Investments calls Palantir a “promising AI investment” and a “serious player” in the space. “They’re doing more than just their cybersecurity for the government. They are really starting to become very creative in the AI world,” he said of the company, known for its government contract work in defense and intelligence.

American consumer sentiment seems to be holding steady even as inflation concerns linger.

The closely watched University of Michigan’s reading came in at 76.5 in March, slightly below consensus.

“After strong gains between November 2023 and January 2024, consumer views have stabilized into a holding pattern; consumers perceived few signals that the economy is currently improving or deteriorating,” said Joanne Hsu, the survey’s consumers director. 

The survey’s one-year inflation expectations were unchanged at 3.0% in March and inflation outlook for the long-term was steady at 2.9% for the fourth straight month.

Still, there are worrying signs consumer spending could be slowing down amid sticky inflation and high borrowing costs.

Retail sales rose less than expected at 0.6% in February while January’s decline was revised even lower to 1.1%.

“It is increasingly evident that after years of a devil-may-care approach to spending, consumers have at last shown signs of being more reserved at the start of this year,” Wells Fargo said in a note last week. 

The latest Bank of America report also showed inflation is taking a toll on Americans as card spending was weak in February.

“More broadly, retail (i.e., goods and food services) spending has been slowing down over the last few quarters, as goods inflation has fallen sharply and services inflation has remained elevated,” the bank said.

“The risk is that sticky services inflation will further shrink retail’s wallet share, to the extent that real spending also slows down.”

— CNBC’s Lisa Kailai Han contributed to this report