Wall Street indexes saw a mixed performance on Tuesday, with investors waiting to see critical inflation data that might impact the US Federal Reserve’s interest rate decisions. While earnings and federal reserve decisions are dominating market sentiments, experts believe some traders have started to factor in the impact of US Presidential elections.
On Tuesday, while Nasdaq and S&P 500 ended in positive territory, Dow Jones closed in negative territory.
Dow Jones Industrial Average saw a fall of ~0.3%, or 96.82 points, to end the session at ~38,972.41 levels. However, 14 components of 30-stock index closed in negative territory, with 16 scrips ending in green. Tech-heavy Nasdaq increased by 0.4% or 59.05 points to close the session at 16,035.30.
S&P 500 went up by ~0.2% to close at ~5,078.18 levels. 6 out of 11 broad sectors of benchmark ended in favourable territory, with 2 closing in positive zone.
On 27th February 2024, Utilities Select Sector SPDR, Communication Services Select Sector SPDR and Materials Select Sector SPDR went up by 1.9%, 0.8% and 0.4%, respectively. On the negative side, Energy Select Sector SPDR saw a fall of 0.4%.
Recently, Reuters reported that the US economy saw a significant increase in 4Q mainly because of healthy consumer spending. However, it seems that it has now slowed down early in the new year.
GDP saw an increase at 3.2% annualized rate in the previous quarter, which has been revised slightly down from earlier reported 3.3% increase as per Commerce Department’s Bureau of Economic Analysis in their 2nd estimate of 4Q GDP growth. Inflation remained fairly mild in the previous quarter, though it was revised marginally up from earlier reported estimates.
Retail sales, housing starts, and production at factories saw a decline in January. While some sort of weakness in data in previous month was blamed on cold temperatures and difficulties about the adjustments of data for seasonal fluctuations, the economists and strategists do not expect a recession.
Financial markets continue to estimate that the US Fed will begin to cut interest rates from June. These expectations have been pushed back from the earlier expectations where analysts were expecting a rate in May month.
Since March 2022 month, the US central bank increased its policy rate by ~525 bps to current range of 5.25%-5.50%. While earnings and federal reserve decisions are dominating market sentiments, stocks traded lower on Wednesday afternoon, with investors expecting that a range of earnings reports from the technology companies that might test the recent AI wave.
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