NEW YORK: Wall Street stocks retreated on Tuesday (May 9) ahead of key US inflation data as markets awaited talks between President Joe Biden and Republican leaders on a high-stakes impasse over fiscal issues.
“It’s a wait and see,” said Steve Sosnick of Interactive Brokers.
Investors will look for clues on whether inflation is continuing to ease following the Labor Department's consumer price index report on Wednesday.
Talks over the US debt ceiling are adding to caution in the market as traders were also waiting for an update on plans for the debt ceiling from a meeting between Biden, Republican House Speaker Kevin McCarthy and other congressional leaders at the White House.
Worries of a potential government default loom over Washington as early as June 1, if Congress does not act to resolve the deadlock.
“Overall, it’s a relatively mild day, but both the debt ceiling as well as the inflation are causing some anxiety,” said Randy Frederick, managing director of trading and derivatives at the Schwab Center for Financial Research.
The Dow Jones Industrial Average fell 56.88 points, or 0.17%, to 33,561.81, the S&P 500 lost 18.95 points, or 0.46%, to 4,119.17 and the Nasdaq Composite dropped 77.36 points, or 0.63%, to 12,179.55.
Among individual companies, Boeing jumped 2.3% as it reached an agreement to sell as many as 300 planes to Ryanair over the next decade.
But Paypal plunged 12.7% despite reporting better-than-expected results as analysts pointed to a lowered profit margin outlook.
Palantir surged 23.3% as the software company predicted it would profitable in each quarter of 2023 citing the demand for its artificial intelligence offerings.
“Companies have generally been beating earnings expectations, but earnings season is always choppy, and today we have some weaker results. That’s weighing a bit on the market,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder here.
Pacwest Bancorp had another volatile day, leading losses in regional banks earlier in the session before closing up 2.35%.
“Any relief that we get in terms of regional banking stress is good, but it’s far too early to say that things are normalized just because a couple of very beaten down banks are having a good day,“ said Steve Sosnik, chief strategist at Interactive Brokers said.
Shares of other Apple suppliers including Qualcomm, Broadcom, Qorvo and Corning ended lower. – AFP, Reuters
