Wednesday, 17 July 2024
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Stock Market

Wall Street falls most after conflicting economic data

  • Tuesday saw a decline in Wall Street stocks, but the market held close to its highest point in two years.
  • The S&P 500 suffered its first consecutive loss since October, slipping 2.60 points.
  • Wall Street is optimistic that the Federal Reserve may soon stop its market-shaking rate hikes.

Tuesday saw a decline in Wall Street stocks, but the market held close to its highest point in two years despite conflicting reports regarding the possibility of a perfect landing for the US economy, which would stifle excessive inflation without going into recession.

The S&P 500 suffered its first consecutive loss since October, slipping 2.60 points, or 0.1%, to close at 4,567.18. The Nasdaq composite increased 44.42, or 0.3%, to 14,229.91, while the Dow Jones Industrial Average fell 79.88, or 0.2%, to 36,124.56.

Conflicting economic data

Amid apprehensions regarding China’s economy, the second largest in the world, stocks in Asia fell more precipitously. Following a reduction in its projected revenue from fees and other non-interest income, KeyCorp saw a 3.7% decline, spearheading a sell-off in bank stocks. But profits of more than 2% for Nvidia and Apple offset the losses.

Following reports that employers posted far fewer job openings at the end of October than anticipated and that services business growth accelerated more last month than anticipated, U.S. stocks and Treasury yields faltered.

Wall Street is optimistic that the Federal Reserve may soon stop its market-shaking rate hikes and instead start lowering rates, which could help the economy avoid a recession and raise investment prices since inflation has dropped from its peak two summers ago.

In particular, investors have been waiting for a slowdown in the job market in the hopes that it will cool more through employers reducing the number of available positions than through employers firing large numbers of employees.

According to a different report, the U.S. services industries saw growth for the 41st time in the previous 42 months, with reports of growth coming from wholesale trade to agriculture. Manufacturing’s weaknesses have been counterbalanced by its strengths.

Treasury yields kept falling, moving away from their peak in late October. With the 10-year Treasury yield dropping from 4.26% to 4.17% late on Monday, there is now more room for equities and other markets. The federal funds rate may have already reached its peak, as suggested by Fed officials, but Wall Street is cautioned against getting carried away with projections about how soon a cut might occur.

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