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Wall Street ends down as data spooks investors awaiting Fed report

EconomyJun 15, 2021 07:00PM ET
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© Reuters. FILE PHOTO: The New York Stock Exchange is pictured in the Manhattan borough of New York City, New York, U.S., April 16, 2021. REUTERS/Carlo Allegri/File Photo

By David French

(Reuters) - Wall Street's main indices closed lower on Tuesday as data showing stronger inflation and weaker U.S. retail sales in May spooked already-jittery investors awaiting the results of the Federal Reserve's latest policy meeting.

Assurance from the Fed that rising prices are transitory and falling U.S. Treasury yields have helped ease some concerns over inflation and supported U.S. stocks in recent weeks. All eyes are now on the central bank's statement at the end of its two-day policy meeting on Wednesday.

Data showed an acceleration in producer prices last month as supply chains struggled to meet demand unleashed by the reopening of the economy. A separate report showed U.S. retail sales dropped more than expected in May.

"There was a bit of a reaction to the economic data we got, which, for the most part, shows that the economy is starting to wean itself off stimulus, the recovery is slowing down a little, and inflation is continuing to grow," said Ed Moya, senior market analyst for the Americas at OANDA.

"We're seeing some very modest weakness, and it'll be choppy leading up to the Fed decision. Right now, the Fed is probably in a position to show they are thinking about tapering, but they're still a long way from actually doing it."

The Fed is likely to announce in August or September a strategy for reducing its massive bond buying program, but will not start cutting monthly purchases until early next year, a Reuters poll of economists found.

The benchmark S&P 500, the blue-chip Dow Jones and the tech-focused Nasdaq have risen 13%, 12.1% and 9.2% respectively so far this year, largely driven by optimism about an economic reopening.

However, the S&P 500 has been broadly stuck within a range, despite recording its 29th record-high finish of 2021 on Monday, versus 33 for all of last year.

The Dow Jones Industrial Average fell 94.42 points, or 0.27%, to 34,299.33, the S&P 500 lost 8.56 points, or 0.20%, to 4,246.59 and the Nasdaq Composite dropped 101.29 points, or 0.71%, to 14,072.86.

Seven of the 11 major S&P sectors slipped. Among them was communication services, which ended 0.5% lower, having hit a record intraday high earlier in the session.

The largest gainer was the energy index, which rose 2.1% on oil prices hitting multi-year highs on a positive demand outlook. Exxon Mobil Corp (NYSE:XOM) had its best day since Mar. 5, jumping 3.6%. [O/R]

In corporate news, Boeing (NYSE:BA) Co gained 0.6% after the United States and the European Union agreed on a truce in their 17-year conflict over aircraft subsidies involving the planemaker and its rival Airbus.

Having slumped 19% on Monday, Lordstown Motors Corp shares rebounded 11.3% after comments from the electric truck manufacturer's president on orders.

Volume on U.S. exchanges was 9.98 billion shares, compared with the 10.58 billion average over the last 20 trading days.

The S&P 500 posted 36 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 87 new highs and 21 new lows.

Wall Street ends down as data spooks investors awaiting Fed report
 

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Comments (11)
Dave Jones
Dave Jones Jun 16, 2021 3:44AM ET
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ok. demand is up but weaker retail sales? yeah wotevs
perplexed76 .
perplexed76 . Jun 16, 2021 2:53AM ET
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inflation is due to demand, so demand fell sharply. We need new tales.
Andy Hsieh
Andy Hsieh Jun 15, 2021 8:16PM ET
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what's the purpose of printing so much more money? interest rates are close to zero yet consumers instead of utilising cheap credit chose to save their money in the bank, and companies pile up cash and if they ever borrow they just buy back their own stocks rather than looking for new investments. So why print so much money to cause higher inflation that harms the economy???
Mitchel Pioneer
Mitchel Pioneer Jun 15, 2021 2:25PM ET
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Another miraculous, mid-day "recovery" for the biggest investment joke in the world, as the fraud and criminal manipulation are woven throughout the US Ponzi Scheme.
Stan Smith
Stan Smith Jun 15, 2021 12:49PM ET
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"Fed might have to change its wording" Unfortunate that word-smithing and not facts is the driver of the economy and financial markets
NUNO LOUREIRO
NUNO LOUREIRO Jun 15, 2021 12:25PM ET
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FED is not gonna do anything, they are hostage of this stupid stock market that keeps going ATH, if they act now the stocks will plunge and they don't want that
Stan Smith
Stan Smith Jun 15, 2021 12:25PM ET
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The can't admit inflation is here to stay and they can't raise rates as both will implode the markets. The only thing they can do is keep meddling in the markets and printing $$. This should debase the dollar but looks like the're rigging that too...What a mess...what a farce MMT and Keynesian economics have created
Carlos GV
Carlos GV Jun 15, 2021 12:25PM ET
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the markets are gonna plunge anyways... sooner than expected...
Andy Hsieh
Andy Hsieh Jun 15, 2021 12:25PM ET
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FED is not gonna spoil Baiden's 4 July celebration.
Stephen Fa
Stephen Fa Jun 15, 2021 11:58AM ET
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Fed mtg be like.. ******are we going to do? The citizens are on to us. Dollar devaluation continues.
Jouni Matero
Jouni Matero Jun 15, 2021 11:58AM ET
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.. and finally someone says 'Jpow lets hear some noooooooise....BRRRRR'
Glenn Ebersole
Glenn Ebersole Jun 15, 2021 11:54AM ET
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When does the market stop making excuses for its values? The great China Trade deal added at least 20+%.
Jon Bal
Jon Bal Jun 15, 2021 10:37AM ET
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did Jpow leave instructions on how to operate the printer?
Jacob Steinschlag
Jacob Steinschlag Jun 15, 2021 10:08AM ET
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Can you at least write WHEN the fed meeting will be ?!
Michael Brown
Michael Brown Jun 15, 2021 10:08AM ET
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tomorrow
Jacob Steinschlag
Jacob Steinschlag Jun 15, 2021 10:08AM ET
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i did, and i know it's today & tomorrow, but seriously, they should include that info in the articles.
PoeT Lwinhtike
PoeT Lwinhtike Jun 15, 2021 9:46AM ET
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nice
 
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