Wall Street’s main indices fell in volatile trading on Tuesday, pulled down by banks and some megacap growth stocks as investors fretted over aggressive monetary tightening and prospects of slowing economic growth.
Eight of the 11 major S&P sectors declined as financial stocks fell 1.3% and real-estate stocks lost 2.4%.
The bank dropped 2.3%, with JPMorgan Chase & Company down 2.4% to weigh the most on the S&P 500 index.
After rising up to 2.8% earlier in the session, the tech-heavy Nasdaq was flat.
Shares of Apple Inc, Google-owners Alphabet Inc and Microsoft Corp rose more than 1%, while Amazon.com and Tesla Inc fell 0.6% and 0.2%, respectively.
At 11:54 a.m., the Dow Jones Industrial Average was down 179.59 points, or 0.56%, at 32,066.11, the S&P 500 was down 16.04 points, or 0.40%, at 3,975.20, and the Nasdaq Composite was down 4.96 points, or 0.04. %, at 11,618.29.
“We all saw this rally this morning… there’s no way to stay ahead of the CPI figures because no one wants to stay long (read) get hot. So you’re going to see a lot of this. panic ahead of the numbers,” said Dennis Dick, a trader at Bright Trading LLC in Las Vegas.
Wednesday’s data expected consumer prices to rise at a slower pace in April, with investors looking for a way out of inflation peaks and rate hikes in the future.
Cleveland Fed Chair Loretta Meester said the US economy would experience turbulence from the Federal Reserve’s efforts to bring down ongoing inflation to more than three times its target and that recent volatility in the stock market would not deter policymakers.
The S&P 500 index and the Nasdaq are down more than 16% and 25%, respectively, this year due to the Ukraine conflict, China’s COVID-19 lockdowns affecting global supply chains and rising bond yields as traders hit higher U.S. adjust interest rates.
“The uncertainty surrounding the Fed and the geopolitical situation leads me to believe that people are going to be a little more cautious,” said Robert Gilliland, managing director of Concenture Wealth Management.
“Markets are trying to figure out what the world will look like in three, six and twelve months from now. I think we have to go back down before we start another move.”
Among other stocks, Novavax Inc. slipped 6.6% after the vaccine maker disclosed a sharp drop in COVID-19 research funding in the first quarter and said it shipped less than a quarter of its total vaccine deliveries scheduled for 2022.
Peloton Interactive Inc. declined 13.4% as the business was “thinly capitalized” after the fitness equipment maker warned it posted a 23.6% slide in quarterly revenue.
The number of issues has increased, declining to a 1.98-to-1 ratio on the NYSE and a 1.75-to-1 ratio on the Nasdaq.
The S&P index posted a new 52-week high and 61 new lows, while the Nasdaq posted 17 new highs and 939 new lows.
This story has been published without modification in text from a wire agency feed. Only the title has been changed.