Investing.com – Wall Street pulled back from record highs on Tuesday as investors returned from the Memorial Day and digested mixed data.
At 12:53PM ET (16:53GMT), the Dow Jones fell 35 points, or 0.16%, the S&P 500 slipped 2 points, or 0.07%, while the Nasdaq Composite dropped 5 points, or 0.08%.
After the S&P and Nasdaq closed at record highs last week, investors opted to take profits, though losses in the tech-heavy index were limited due to enthusiasm over the fact that Amazon.com (NASDAQ:AMZN) passed $1,000 per share for the first time ever. The online retailer was unable to hold the psychological level and was last up around 0.4%, hovering just below record highs.
Amid a shower of economic data released on Tuesday, focus was on the inflation data. Thought the monthly core PCE price index ticked up more than expected in April, the annualized reading eased back to 1.5%.
Considered the Federal Reserve’s (Fed) preferred inflation indicator, the numbers did little to change market expectations that the central bank will remove policy accommodation at its June meeting.
According to Investing.com's Fed Rate Monitor Tool, Fed funds futures currently count on a rate hike with odds at around 81%.
Though the monthly jobs report set for release on Friday will be in the spotlight, the fact that the labor market is considered to be at full employment will continue to focus attention on annualized wage inflation.
Of note, Dallas Fed president Robert Kaplan told CNBC that he still expects the central bank to hike rates twice this year, despite the fact that he doubts that growth will reach the 3% forecast from the U.S. President Donald Trump’s administration.
Fed governor Lael Brainard was scheduled for a speech later in the day.
In other economic data out Tuesday, both personal income and expenditure increased in line with expectations.
Although consumer confidence fell more than expected in May, the Conference Board noted that they remained “optimistic that the economy will continue expanding into the summer months”.
Furthermore, housing prices rose 5.9% from a year before, according to the S&P-Case Shiller, beating expectations for a 5.7% increase.
Meanwhile, oil prices fell around 1% on Tuesday amid signs of a resurgence in Libya's output and on concerns that extended production cuts by the world's top exporters may not be enough to drain a global glut that has depressed prices for almost three years.
U.S. crude futures traded down 0.82% to $49.39 by 12:55PM ET (16:55GMT), while Brent oil sank 1.20% to $52.01.