US STOCKS-Wall St falls on rate concerns fueled by retail sales data, big banks drop

PacWest Bancorp

15/08/2023 15:18

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      July retail sales rise more than expected
    

        * 
      Nvidia gains as UBS, Wells Fargo raise PT
    

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      U.S. big banks fall as a report warns of downgrades
    

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      Indexes down: Dow 0.65%, S&P 0.60%, Nasdaq 0.47%
    

  
 (Updated at 0951 am ET/1351 GMT)
    By Amruta Khandekar and Shristi  Achar A
       Aug 15 (Reuters) - Wall Street's main indexes fell on
Tuesday after stronger-than-expected retail sales data stoked
worries interest rates could stay higher for longer, while U.S.
big banks dropped on a report that Fitch could downgrade some
lenders.
    The Commerce Department's report showed retail sales grew
0.7% last month against expectations of a 0.4% rise, suggesting
the U.S. economy remains strong.
    "Given the fact that we are so hyper-vigilant about the Fed
and what their next step will be in September, it isn't
surprising that the market reacted with jitters," said Peter
Andersen, founder of Andersen Capital Management in Boston.
    "The retail sales number might indicate that the Fed would
continue to raise rates."
   Traders' odds of a pause on hikes by the Federal Reserve at
its September meeting briefly dipped after the data only to
climb back to 89%.
    Also weighing on markets, JPMorgan Chase  JPM.N , Bank of
America  BAC.N  and Wells Fargo  WFC.N  slipped between 1.8% and
2.2% after a report said ratings agency Fitch could downgrade
multiple banks.    
    The S&P 500 banking index  .SPXBK  hit a one-month low, down
2.0%. 
    Shares of regional lenders PacWest Bancorp  PACW.O , Zions
Bancorporation  ZION.O  and Western Alliance Bank  WAL.N  fell
between 3.6% and 6.3% after the Federal Deposit Insurance Corp's
latest regulatory overhaul proposal.
    
    The yield on the 10-year benchmark Treasury note  US10YT=RR 
also climbed to hit a near 10-month high of 4.27%.  US/ 
    Rising Treasury yields have kept equities under pressure
after hotter-than-expected producer prices data last week fueled
fears the Fed could keep rates higher for longer than previously
anticipated.
    All major 11 S&P 500 sectors declined, with energy stocks
 .SPNY  leading losses on weaker crude prices.  O/R  
    Nvidia  NVDA.O  was an outlier among major technology and
growth stocks, rising 1.6% after UBS and Wells Fargo lifted
their price targets on the stock. 
    U.S.-listed shares of Chinese companies JD.Com  JD.O ,
Alibaba Group  BABA.N  and Bilibili  BILI.O  slid between 1.5%
and 3% following another round of disappointing economic data
from China which prompted Beijing to cut key policy rates.  
    At 9:51 a.m. ET, the Dow Jones Industrial Average  .DJI  was
down 229.22 points, or 0.65%, at 35,078.41, the S&P 500  .SPX 
was down 26.94 points, or 0.60%, at 4,462.78, and the Nasdaq
Composite  .IXIC  was down 64.29 points, or 0.47%, at 13,724.04.
    Among other stocks, General Motors  GM.N  fell 1.5% after
Berkshire Hathaway  BRKa.N  cut its stake in the automaker.
    Warren Buffett's Berkshire disclosed a new investment in
homebuilder D.R. Horton  DHI.N  and Lennar Corp  LEN.N , lifting
their shares up 2.4% and 1.6%, respectively. 
    Home Depot  HD.N  added 1% after the home improvement chain
posted a smaller-than-expected drop in quarterly same-store
sales and topped profit estimates.    
    Declining issues outnumbered advancers by a 5.29-to-1 ratio
on the NYSE and  a 2.90-to-1 ratio on the Nasdaq.
    The S&P index recorded two new 52-week highs and 14 new
lows, while the Nasdaq recorded 24 new highs and 90 new lows.
 
  
    
  
    
  
    
  

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U.S. Retail sales in July    https://tmsnrt.rs/448SB5I
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 (Reporting by Amruta Khandekar, Shristi Achar A and Shashwat
Chauhan; Editing by Maju Samuel and Vinay Dwivedi)
 ((Amruta.Khandekar@thomsonreuters.com;
Shristi.AcharA@thomsonreuters.com;))