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Wall Street ends mixed; Salesforce selloff pressures Dow

Stock Markets Dec 01, 2022 06:56PM ET
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© Reuters. FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 29, 2022. REUTERS/Brendan McDermid
 
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By Ankika Biswas and Noel Randewich

(Reuters) - Wall Street ended mixed on Thursday as a selloff in Salesforce (NYSE:CRM) weighed on the Dow, while traders digested U.S. data that suggested the Federal Reserve's interest rate hikes are working.

On Wednesday, the S&P 500 surged over 3% on optimism the Fed might moderate its campaign of interest rate hikes.

U.S. manufacturing activity shrank in November for the first time in 2-1/2 years as higher borrowing costs weighed on demand for goods, data showed, evidence the Fed's rate hikes have cooled the economy.

The personal consumption expenditures (PCE) price index rose 0.3%, the same as in September, and over the 12 months through October the index increased 6.0% after advancing 6.3% the prior month.

Excluding the volatile food and energy components, the PCE price index rose 0.2%, one-tenth less than expected, after gaining 0.5% in September.

"On a normal day, the package of data this morning would be pretty risk-on, but after the rally yesterday, I think it's not quite good enough to push another leg higher," said Ross Mayfield, an investment strategy analyst at Baird.Wednesday's rally drove the S&P 500 index above its 200-day moving average for the first time since April after Fed Chair Jerome Powell said it was time to slow the pace of interest rate hikes.

Traders now see a 79% chance the Fed will increase its key benchmark rate by 50 basis points in December and a 21% chance it will hike rates by 75 basis points.

Salesforce Inc tumbled 8.3% after the software maker said Bret Taylor would step down as co-chief executive officer in January.

Dollar General Corp (NYSE:DG) fell 7.5% after the discount retailer cut its annual profit forecast, while Costco Wholesale Corp (NASDAQ:COST) dropped 6.6% after the membership-only retail chain reported slower sales growth in November.

The S&P 500 declined 0.08% to end the session at 4,076.79 points.

The Nasdaq gained 0.13% to 11,482.45 points, lifted by gains of over 1% each in Nvidia (NASDAQ:NVDA) and Facebook-owner Meta Platforms.

Dow Jones Industrial Average declined 0.56% to 34,396.53 points, pulled lower by Salesforce.

Of the 11 S&P 500 sector indexes, seven declined, led lower by financials, down 0.71%, followed by a 0.47% loss in consumer staples.

A U.S. Labor Department report on Thursday showed initial claims for state unemployment benefits dropped 16,000 to a seasonally adjusted 225,000 for the week ended Nov. 26.

Investors now await nonfarm payrolls data on Friday for clues about how rate hikes have affected the labor market.

With a month left in 2022, the S&P 500 is down about 14% year to date, and the Nasdaq has lost about 27%.

Advancing issues outnumbered falling ones within the S&P 500 by a 1.1-to-one ratio.

The S&P 500 posted 32 new highs and no new lows; the Nasdaq recorded 118 new highs and 91 new lows.

Volume on U.S. exchanges was relatively heavy, with 11.7 billion shares traded, compared to an average of 11.3 billion shares over the previous 20 sessions.

Wall Street ends mixed; Salesforce selloff pressures Dow
 

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Comments (10)
Kerry Ditto
Kerry Ditto Dec 01, 2022 4:30PM ET
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Dow entered bull trap?
Matt Kay
Matt Kay Dec 01, 2022 4:16PM ET
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SPOO is censored?ok, SnP500. better?
Matt Kay
Matt Kay Dec 01, 2022 4:16PM ET
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what pressure you donkeys? stonks went up 4% yesterday! I guess we are back in the insane land of 40% a year ***returns
Stephen Fa
Stephen Fa Dec 01, 2022 2:56PM ET
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Santa rally coming
Gus McCrae
Gus McCrae Dec 01, 2022 2:56PM ET
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yeah, buy it. buy the top
Stephen Fa
Stephen Fa Dec 01, 2022 2:56PM ET
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I didn't say when @Gus. It wouldn't be a rally if it were the top.
Stephen Fa
Stephen Fa Dec 01, 2022 2:56PM ET
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Unless SPX goes well over 4015 soon, I see more downside before the Santa rally.
Mitchel Pioneer
Mitchel Pioneer Dec 01, 2022 2:22PM ET
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The biggest investment JOKE in the world miraculously crawls from the grave once again.
Dave Jones
Dave Jones Dec 01, 2022 1:18PM ET
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salesforce is just a fluff company with valuations based on nothing. It's an awful product.
Stephen Fa
Stephen Fa Dec 01, 2022 1:18PM ET
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What CRM product do you recommend, @Dave?
Dave Jones
Dave Jones Dec 01, 2022 1:18PM ET
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Tom Michaels
Tom Michaels Dec 01, 2022 11:59AM ET
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What do you want, it's a sign of easi f Inflation. Can't win in this junk market.
Bill Riley
Bill Riley Dec 01, 2022 9:46AM ET
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fed rate hikes have about 9 months until they affect the profit margins. credit cards and mortgage rates go up months before corporate debts need to be refinanced. companies are starting to feel the first rate hikes this month, stocks should lose another 30 percent by summer.
Ravjir Urjinee
Ravjir Urjinee Dec 01, 2022 9:46AM ET
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When QE is in full swing I dont know about that
Bill Riley
Bill Riley Dec 01, 2022 9:46AM ET
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qe isn't coming back. also inflation will probably be above 3 percent by end of 2023. no qe or rate drops until inflation is below 2 percent, mid 2024.
James Carter
James Carter Dec 01, 2022 9:46AM ET
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Where u been pal .. u shouldn't be trading if u think QE is ever coming back.. 15 years of it has done ill reputable damage.. Get ready for benchmark Intrest rate to be roughly 10% .. for minimum 5yrs !!
TheEnd IsNigh
TheEnd IsNigh Dec 01, 2022 9:46AM ET
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Ravjir...you wanna see the USD be destroyed, don't you? That's the result of anymore QE. The Fed has F'd themselves. The only way out of this mess is severe global pain that should have taken place over a decade ago. People have become accustomed to easy money. The laws of finance don't support it as a long-term solution. Booms always come with busts.
Bill Riley
Bill Riley Dec 01, 2022 9:41AM ET
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fed rate hikes won't hit Wallstreet until February. corporations will experience what the mortgage industry has been facing.
JJ JJ
JJ JJ Dec 01, 2022 9:41AM ET
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Ponzi scheme.
Stan Smith
Stan Smith Dec 01, 2022 9:31AM ET
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??Doesn't this increase the chance of rate hikes then. Yesterday stocks stored on the news that the FED would be curbing hikes. Stocks up no matter the news...is that the message?
Tommaso Meacci
Tommaso Meacci Dec 01, 2022 9:31AM ET
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people are still drunk ok optimism
 
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