(Bloomberg) — Wall Street traders sent stocks down and bonds up after the latest round of economic data signaled a slowdown in momentum.
Most Read from Bloomberg
Just 24 hours before the release of the Federal Reserve’s preferred price gauge, a report showed the US grew at softer pace — as both spending and inflation were marked down. An economic slowdown could mean the central bank could have room to cut interest rates this year. But that could also be a concern for consumption and corporate profits.
“The economic data today are a double-edged sword,” said Chris Zaccarelli at Independent Advisor Alliance. “Slowing personal consumption are a sign that the economic expansion is cooling, which could be a concern for companies. But on the other hand, slowing consumption and economic growth could be just the news we need to see in order for the rate of inflation to keep coming down and allow the Fed to reduce interest rates after all.”
The S&P 500 dropped below 5,250, led by losses in its most-influential group. Tech shares were hit as Salesforce Inc. tumbled after the software maker said sales growth in the current quarter will stall to its slowest in history. Kohl’s Corp. also plunged after signaling demand for apparel and home goods remained weak.
Treasury two-year yields, which are more sensitive to imminent Fed moves, dropped four basis points to 4.93%. The dollar retreated.
Corporate Highlights:
-
Dollar General Inc.’s sales rose more than expected last quarter, signaling progress in the discount retailer’s turnaround efforts.
-
Best Buy Co. reported better-than-expected profitability in the first quarter, even as sales woes deepened and consumers remained on the sidelines with their electronics purchases.
-
HP Inc. reported quarterly revenue that topped analysts’ estimates, including the first increase in PC sales in two years, an optimistic signal for a long-awaited rebound in the market.
Key events this week:
-
Japan unemployment, Tokyo CPI, industrial production, retail sales, Friday
-
China official manufacturing and non-manufacturing PMI, Friday
-
Eurozone CPI, Friday
-
US consumer income, spending, PCE deflator, Friday
-
Fed’s Raphael Bostic speak, Friday
Some of the main moves in markets:
Stocks
-
The S&P 500 fell 0.3% as of 10:23 a.m. New York time
-
The Nasdaq 100 fell 0.4%
-
The Dow Jones Industrial Average fell 1%
-
The Stoxx Europe 600 rose 0.6%
-
The MSCI World Index was little changed
Currencies
-
The Bloomberg Dollar Spot Index fell 0.3%
-
The euro rose 0.3% to $1.0836
-
The British pound rose 0.2% to $1.2729
-
The Japanese yen rose 0.6% to 156.74 per dollar
Cryptocurrencies
-
Bitcoin rose 2% to $68,761.24
-
Ether rose 1.1% to $3,791.22
Bonds
-
The yield on 10-year Treasuries declined five basis points to 4.56%
-
Germany’s 10-year yield declined two basis points to 2.67%
-
Britain’s 10-year yield declined four basis points to 4.36%
Commodities
-
West Texas Intermediate crude fell 0.4% to $78.95 a barrel
-
Spot gold rose 0.5% to $2,350.23 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Sagarika Jaisinghani, Alex Nicholson, Chiranjivi Chakraborty, Winnie Hsu and Stephen Kirkland.
Most Read from Bloomberg Businessweek
©2024 Bloomberg L.P.