Wall Street’s main indexes slipped from record levels on Wednesday as investors digested recent gains while awaiting a speech by Federal Reserve Chair Jerome Powell for clues on the pace of an economic rebound.
Tesla Inc’s 4.2% slide and Amazon.com Inc’s 1.1% drop weighed the most on the S&P 500 and the Nasdaq. Shares of both the companies pulled the consumer discretionary index down 1.3%.
Bets on more fiscal aid and swift vaccine distribution have powered the main U.S. stock indexes to a series of all-time peaks recently.
Wall Street’s fear gauge spiked to a one-week high of 23.85 points.
“The markets been very speculative with particularly high-risk stocks trading up very quickly. And when you get that type of move, you’re always going to get a little bit of a need for those investors to get out quickly if they see it turn,” said Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey.
“We probably should expect a few downdrafts even without any news whatsoever.”
At 10:44 a.m. ET, the Dow Jones Industrial Average fell 149.21 points, or 0.48%, to 31,226.62, the S&P 500 lost 25.08 points, or 0.64%, to 3,886.15 and the Nasdaq Composite lost 144.86 points, or 1.03%, to 13,862.84.
Data on Wednesday showed U.S. consumer prices rose moderately in January but underlying inflation remained benign as the COVID-19 pandemic continues to be a drag on the labor market and services industry.
The Fed has signaled it would tolerate higher prices “for some time” as the economy climbs out of a coronavirus-driven recession. Powell will be speaking about the state of the U.S. labor market in a webinar at 2 p.m. ET (1900 GMT) on Wednesday.
“Everyone expects inflation to rise but no one knows how quickly the Fed will react given what the central bank has signaled,” said Arian Vojdani, investment strategist at MV Financial in Bethesda, Maryland.
President Joe Biden on Tuesday agreed to a proposal by Democratic lawmakers to limit or phase out stimulus payments to higher-income individuals as part of his administration’s $1.9 trillion coronavirus relief bill.
Fourth-quarter earnings have also exceeded expectations with analysts now predicting earnings for S&P 500 firms will rise 2.5%, a stark reversal from the 10.3% decline forecast at the beginning of the year, per Refinitiv.
Twitter Inc added about 13.6% after it forecast a strong start to 2021 as ad spending rebounds from a rock bottom.
Under Armour Inc advanced more than 9% after the athletic apparel maker beat quarterly revenue estimates.
Lyft Inc jumped 8% after the ride-hailing firm said it is chopping costs and now expects to be profitable in the third quarter.
Rival Uber Technologies Inc gained 4% ahead of its results, while Walt Disney Co, also set to report after markets close, rose 1.2%.
Declining issues outnumbered advancers by a 1.3-to-1 ratio on the NYSE and by a 1.6-to-1 ratio on the Nasdaq.
The S&P 500 posted 42 new 52-week highs and no new lows, while the Nasdaq recorded 545 new highs and 18 new lows.
Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor
Read all the Latest News, Breaking News and Coronavirus News here
Comments
0 comment