US STOCKS-Wall St indexes fall ahead of inflation data

Mongodb

10/12/2024 21:00

(Updates to market close)
    By Sinéad Carew and Purvi Agarwal
       Dec 10 (Reuters) - Wall Street's main indexes closed
lower on Tuesday as investors anxiously awaited key inflation
reports that could influence the Federal Reserve's interest rate
decision next week.
    Among the S&P 500's 11 major industry sectors, communication
services  .SPLRCL  was the biggest boost with help from a rally
in shares of Google-parent Alphabet  GOOGL.O  after it unveiled
a new chip.
    The biggest drag was from technology  .SPLRCT , pressured by
a sell-off in Oracle  ORCL.N  shares after the cloud computing
company missed Wall Street estimates for second-quarter results.
    Also weighing on technology was a sell-off in chips after
China announced on Monday an investigation into Nvidia  NVDA.O 
over suspected violations of the country's anti-monopoly law.
The probe was widely seen as retaliation against Washington's
latest curbs on the Chinese chip sector.
    According to preliminary data, the S&P 500  .SPX  lost 16.53
points, or 0.27%, to end at 6,036.32 points, while the Nasdaq
Composite  .IXIC  lost 49.45 points, or 0.25%, to 19,687.24. The
Dow Jones Industrial Average  .DJI  fell 143.46 points, or
0.32%, to 44,259.60.
    A November reading of the Consumer Price Index, due on
Wednesday, is among the last major reports ahead of the Fed's
Dec. 17-18 meeting. Headline inflation is expected to have risen
slightly in November to 2.7% from 2.6% in October. The Producer
Price Index report will follow on Thursday.
    "There's a little bit of wait-and-see in the market ahead of
the CPI and PPI data this week," said Mona Mahajan, head of
investment strategy at Edward Jones. "Markets want to see a
number that won't be too disruptive to the Fed next week."
    If the CPI comes in line with estimates, investors will
expect an "all clear" for the Fed to lower rates by 25 basis
points next week, she added.
    Traders see an 86% chance for a cut next week, CME's
FedWatch Tool showed. Bets had jumped after Friday's news of an
uptick in unemployment along with a rebound in job growth, which
had slowed in October.
    Noting the S&P 500's roughly 27% gain for the year so far,  
   Lindsey Bell, chief strategist at 248 Ventures in Charlotte,
North Carolina, said investors are cautious ahead of the
economic data and Fed meeting.  
   "We're in a seasonally strong period of the year and
investors are just kind of taking a breather," said Bell.
    Market participants will be watching out for signs that the
U.S. central bank will pause its easing cycle in January, after
a host of Fed officials last week hinted at a slower pace of
monetary policy easing on the back of a resilient economy.
    "It's less about what the Fed does next week but what they
say about the future trajectory of interest rates," said Bell.
    Among individual stock movers, software firm MongoDB  MDB.O 
lost ground despite raising its forecast for annual results.
    Shares in Walgreens Boots Alliance  WBA.O  rallied after
reports that it is in talks to sell itself to private equity
firm Sycamore Partners.
    Alaska Airlines  ALK.N  shares rose as it raised its
fourth-quarter profit forecast, while Boeing  BA.N  gained
ground after Reuters reported the planemaker restarted
production of its 737 MAX jets last week.
    Luxury homebuilder Toll Brothers  TOL.N  shares fell after
its quarterly results beat expectations but its current quarter
forecasts disappointed.

 (Reporting by Sinéad Carew in New York, Purvi Agarwal and
Shashwat Chauhan in Bengaluru; Editing by Maju Samuel and
Richard Chang)
 ((sinead.carew@thomsonreuters.com, +13322191897))