US stocks slide from record highs as investors examine weak retail sales data ahead of Fed move
U.S. stocks slipped from record highs on Tuesday as investors reflected on disappointing retail sales ahead of the two-day Federal Open Market Committee meeting.
Spending at U.S. retailers for the month of May collapsed for the first time since February as more and more economic restrictions were reversed and Americans settled into a new sense of normalcy.
Retail sales in the United States fell 1.3% in May, the Census office. Economists polled by Bloomberg held a median estimate of a 0.7% drop. The drop puts monthly sales at $ 620 billion and just below the record high in April.
Meanwhile, investors continue to weigh inflationary pressures ahead of the FOMC’s decision scheduled for Wednesday. Most economists predict that the central bank will leave its policy largely unchanged. Investors will focus on the reduction talks, the latest economic projections and inflation.
âDespite the ‘transient’ message regarding inflation, some committee members must be a little uncomfortable,â said Marcus Dewsnap, head of bond strategy at IGM, part of Informa Financial Intelligence.
So far, hard data hasn’t quite suggested the type of second quarter that will force economic growth to meet the Fed’s projections for 2021, Dewsnap added.
The 10-year Treasury yield hovered around 1.5% for most of the day.
In March, Fed officials saw consumer prices rise 2.4% in the fourth quarter of 2021 from a year earlier. This pace, they said, would be in line with their long-term target of 2% average annual inflation.
Here’s where the U.S. indices were at the 4 p.m. ET close on Tuesday.
DraftKings online gaming company plunged to 12% on allegations of a short seller of illegal activity. A Hindenburg Research report, a short seller, claimed that DraftKings was hiding “black market operations”.
In cryptocurrencies, bitcoin finally reached the $ 40,000 level on Monday after trending below that level so far in June.
Again, a new investigation found that hedge fund bosses plan to increase their holdings of cryptocurrencies, predicting that an average of 7.2% of their assets under management will be held in digital tokens by 2026.
Gold slipped 0.45% to $ 1,858.92 an ounce.