U.S. stocks fell on Tuesday as investors awaited Nvidia’s quarterly results and the Federal Reserve’s policy meeting minutes; A spate of downbeat earnings from retailers also weighed on sentiment.
The tech-fueled rally led the S&P 500 and Nasdaq to post their highest closing levels in more than three months on Monday as investors continued betting that the Fed is nearing the end of its rate-hiking cycle.
Big Tech stocks, which have powered much of the S&P 500’s gains this year, face a major test when Nvidia reports third-quarter results after markets close.
The chip designer is again expected to provide a strong revenue forecast, but the focus will be on the impact of expanded U.S. restrictions on sales of its high-end chips to China.
Shares of Nvidia fell 0.2%, while other megacap stocks were mixed.
“The market is digesting yesterday’s big move,” said Robert Pavlik, senior portfolio manager at Dakota Wealth, adding that a year-end rally is still likely given better-than-expected earnings and moderate inflation.
Ahead of the quarterly report, the Fed’s November meeting minutes are likely to offer more clues about the path monetary policy will take after easing in consumer and producer prices raises expectations that U.S. interest rates will peak. The minutes are expected to be released at 1400 ET (1900 GMT).
Investors have fully priced in the possibility that the Fed will keep interest rates steady in December, according to CME Group’s Fedwatch tool; 29% believe that the central bank is likely to cut interest rates in March.
“The economy is slowing down. “If they (the Fed) stand on their own and let this continue to slide, then you start to worry that a soft landing could turn into a bit of a bumpy descent,” Pavlik added.
At 09:42, the Dow Jones Industrial Average decreased by 80.09 points (0.23 percent) to 35,070.95 points, the S&P 500 index decreased by 10.00 points (0.22 percent) to 4,537.38 points and the Nasdaq Composite index decreased to 51.86 points. points (0.36 points) decreased. % at 14,232.68.
A series of negative corporate updates from US retailers have painted a negative picture for consumer spending.
Lowe’s Cos. fell 2.8% after the home improvement chain forecast a larger-than-previously expected decline in annual comparable sales and lowered its profit forecast for the year.
The S&P 500 retail subindex, which includes the stock, fell 1.7%.
Best Buy lost 4.5% after the electronics retailer said it expected a steeper decline in annual comparable sales, while Kohl’s Corp lost 9.2% after missing third-quarter sales forecasts.
While this week has been light in terms of economic data, trade volumes are also expected to be weak ahead of the Thanksgiving holiday.
Declining issues outnumbered the leading ones by a 2.33-to-1 ratio on the NYSE and a 2.04-to-1 ratio on the Nasdaq.
While the S&P index recorded 19 new 52-week highs, there was no new decline; Nasdaq recorded 24 new highs and 36 new lows.
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