Wall Street meets its demise as investors focus on economic slowdown

Traders at work on the floor of the New York Stock Exchange (NYSE) in New York City, USA, August 22, 2022. REUTERS/Brendan McDermid

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  • US Composite PMI at lowest since February 2021
  • Zoom collapses due to weak forecast
  • Macy’s stock rises on earnings growth
  • Indices: S&P 500 -0.22%, Nasdaq flat, Dow -0.47%

(Reuters) – Wall Street closed on Tuesday as investors focused on data pointing to a slowing economy ahead of the Federal Reserve’s meeting in Jackson Hole, Wyoming, later this week. It closed down and closed.

The S&P 500 fell after data showed US private sector business activity contracted for a second straight month in August. Services were particularly soft as demand weakened in the face of inflation and tightening financial conditions.read more

The S&P Global Flash Composite Purchasing Managers Index (PMI) in August fell to 45, the lowest since February 2021, from 47.7 in July. A reading less than 50 indicates contraction of activity.

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Stocks fell in recent sessions ahead of this week’s central bank meeting in Jackson Hole, as Fed Chairman Jerome Powell said Friday would eradicate inflation, which has hovered at a 40-year high. It is expected to reinforce strong commitments.

With some policymakers recently bouncing off expectations of a dovish turnaround and emphasizing the Fed’s commitment to combating inflation, traders are pushing for central bank rate hikes of 50 basis points and 75 basis points. Opinions are divided between the point rate hike.fed watch

“Over the past week, we have recognized that the Fed could raise interest rates by 75 basis points in September,” said Jake Dollarhyde, CEO of Longbow Asset Management in Tulsa, Oklahoma. said. “The market fears Powell will return to a hawkish stance again.”

The benchmark 10-year yield rose to its highest level since late July.

Zoom Video Communications (ZM.O) is down almost 17% after the former ‘stay home’ stock darling lowered its annual profit and earnings forecasts.read more

Seven of the 11 S&P 500 sector indices fell, with real estate (.SPLRCR) down 1.46%, followed by healthcare (.SPXHC) down 1.39%.

After a turbulent start to the year, markets rose from mid-June on hopes that inflation had peaked, but that summer’s rally plummeted last week on renewed concerns about the Fed’s aggressive stance to tighten monetary policy. did.

The S&P 500 dropped 0.22% to end the session with 4,128.73 points.

The Nasdaq remained unchanged at 12,381.30 points and the Dow Jones Industrial Average fell 0.47% to 32,909.59 points.

Wall Street’s Busiest Deal

The S&P 500 Energy Index (.SPNY) rose 3.6%, tracking a surge in oil prices amid renewed focus on tight supply.

Macy’s (MN) rose 3.8% as retailers beat quarterly profit expectations. Palo Alto Networks (PANW.O) surged about 12% after the cybersecurity firm posted bright quarterly results and announced a stock split plan.read more

The Philadelphia Semiconductor Index (.SOX) rose 0.7%, narrowing its 2022 loss to about 27%.

In the S&P 500 (.AD.SPX), losers outnumber risers by a 1.5 to 1 ratio.

The S&P 500 hits 1 new high and 30 new lows. The Nasdaq hit 45 new highs and 150 new lows.

Volume on US exchanges was relatively low, with 9.4 billion shares traded, averaging 10.9 billion shares over the last 20 sessions.

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Reporting by Bansari Mayur Kamdal and Devic Jain (Bengaluru) and Noel Randewich (Oakland, CA); edited by Margherita Choi

Our standards: Thomson Reuters Trust Principles.

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