NEW YORK: Wall Street stocks ended lower on Tuesday (Sept 12) as Oracle shares tumbled more than 13% after a weak forecast and surging oil prices deepened worries about persistent price pressures ahead of crucial inflation readings this week.
The Dow Jones Industrial Average fell 17.73 points, or 0.05%, to 34,645.99, the S&P 500 lost 25.56 points, or 0.57%, to 4,461.9 and the Nasdaq Composite dropped 144.28 points, or 1.04%, to 13,773.62.
Oracle shares dived to their lowest since June after the cloud-services provider forecast current-quarter revenue below targets and narrowly missed first-quarter expectations.
Cloud-computing heavyweights Amazon.com and Microsoft each fell more than 1%, pressured by Oracle's weak forecast and by a rise in US Treasury yields.
Oil prices jumped more than 1%, building on a recent rally and stoking worries that sticky inflation could mean US interest rates stay higher longer in the aftermath of strong economic data.
“People are a little bit worried about energy prices picking up pretty aggressively in recent weeks and that creates some concerns as we look forward to November” when some investors worry Federal Reserve policy makers may raise rates again, said Thomas Hayes, chairman at Great Hill Capital LLC.
Investors are awaiting August consumer price index data due on Wednesday and producer prices reading scheduled for Thursday to gauge the outlook for US interest rates ahead of the Fed’s meeting on Sept 20.
Interest rate traders see a 93% chance of rates remaining at the current levels in September but just a 56% likelihood of a pause at the November meeting, according to the CME FedWatch Tool.
“All the all the inputs that we get between now and the November meeting will be important, especially those related to inflation. So that thrusts a lot of importance on tomorrow’s CPI report,” said Art Hogan, chief market strategist at B Riley Wealth.
Investors will also monitor the European Central Bank’s policy decision on Thursday, when it is seen holding rates after nine consecutive hikes.
Apple dropped 1.8% after unveiling new iPhones, while not increasing prices as it faces a global smartphone slump. The stock was also hurt by a report that China’s Huawei Technologies has raised the second-half shipment target for its Mate 60 series smartphone by 20%.
The most traded stock in the S&P 500 was Tesla , with US$36.7 billion worth of shares exchanged during the session. The electric car maker declined 2.23%. – Reuters
Source: The Sun Daily
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