(RTTNews) – Stocks moved mostly lower over the course of the trading day on Tuesday, giving back ground after trending higher over the past few sessions. The major averages all moved to the downside, pulling back off Monday’s record closing highs.
The tech-heavy Nasdaq led the way lower, slumping 215.50 points or 1.0 percent to 22,573.47. The S&P 500 slid 36.83 points or 0.6 percent to 6,656.92, while the narrower Dow dipped 88.76 points or 0.2 percent to 46,292.78.
The weakness that emerged on Wall Street may partly reflected concerns stocks are overvalued following comments by Federal Reserve Chair Jerome Powell.
Speaking at an event Rhode Island, Powell described equity prices as “fairly highly valued” following the recent run to record highs.
Powell also addressed the outlook for monetary policy, noting the Fed is facing a “challenging situation” as near-term risks to inflation are tilted to the upside and risks to employment to the downside.
“Two-sided risks mean that there is no risk-free path,” Powell said. “If we ease too aggressively, we could leave the inflation job unfinished and need to reverse course later to fully restore 2 percent inflation.”
“If we maintain restrictive policy too long, the labor market could soften unnecessarily,” he continued. “When our goals are in tension like this, our framework calls for us to balance both sides of our dual mandate.”
A pullback by shares of Nvidia (NVDA) also weighed on the Nasdaq, with the chipmaker tumbling by 2.8 percent after surging nearly 4 percent to a new record closing high on Monday.
The rally in Monday’s session came after Nvidia and OpenAI announced a strategic partnership to deploy at least 10 gigawatts of Nvidia systems for OpenAI’s next-generation AI infrastructure.
Sector News
Retail stocks showed a significant move to the downside on the day, dragging the Dow Jones U.S. Retail Index down by 1.2 percent.
Notable weakness also emerged among software stocks, as reflected by the 1.2 percent loss posted by the Dow Jones U.S. Software Index.
On the other hand, energy stocks continued to turn in a strong performance amid a sharp increase by the price of crude oil, with the Philadelphia Oil Service Index surging by 3.5 percent and the NYSE Arca Oil Index climbing by 1.6 percent.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Tuesday, with Japanese markets closed for a holiday. Hong Kong’s Hang Seng Index slid by 0.7 percent, while South Korea’s Kospi climbed by 0.5 percent.
Meanwhile, European stocks moved mostly higher on the day. The French CAC 40 Index advanced by 0.5 percent and the German DAX Index rose by 0.4 percent, although the U.K.’s FTSE 100 Index bucked the uptrend and closed just below the unchanged line.
In the bond market, treasuries moved to the upside after showing a lack of direction earlier in the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.3 basis points to 4.120 percent.
Looking Ahead
A report on new home sales may attract some attention on Wednesday, although trading activity may be somewhat subdued ahead of the release of more closely watched data later in the week.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
U.S. Stocks Give Back Ground After Powell Comments About Valuations
(RTTNews) – Stocks moved mostly lower over the course of the trading day on Tuesday, giving back ground after trending higher over the past few sessions. The major averages all moved to the downside, pulling back off Monday’s record closing highs.
The tech-heavy Nasdaq led the way lower, slumping 215.50 points or 1.0 percent to 22,573.47. The S&P 500 slid 36.83 points or 0.6 percent to 6,656.92, while the narrower Dow dipped 88.76 points or 0.2 percent to 46,292.78.
The weakness that emerged on Wall Street may partly reflected concerns stocks are overvalued following comments by Federal Reserve Chair Jerome Powell.
Speaking at an event Rhode Island, Powell described equity prices as “fairly highly valued” following the recent run to record highs.
Powell also addressed the outlook for monetary policy, noting the Fed is facing a “challenging situation” as near-term risks to inflation are tilted to the upside and risks to employment to the downside.
“Two-sided risks mean that there is no risk-free path,” Powell said. “If we ease too aggressively, we could leave the inflation job unfinished and need to reverse course later to fully restore 2 percent inflation.”
“If we maintain restrictive policy too long, the labor market could soften unnecessarily,” he continued. “When our goals are in tension like this, our framework calls for us to balance both sides of our dual mandate.”
A pullback by shares of Nvidia (NVDA) also weighed on the Nasdaq, with the chipmaker tumbling by 2.8 percent after surging nearly 4 percent to a new record closing high on Monday.
The rally in Monday’s session came after Nvidia and OpenAI announced a strategic partnership to deploy at least 10 gigawatts of Nvidia systems for OpenAI’s next-generation AI infrastructure.
Sector News
Retail stocks showed a significant move to the downside on the day, dragging the Dow Jones U.S. Retail Index down by 1.2 percent.
Notable weakness also emerged among software stocks, as reflected by the 1.2 percent loss posted by the Dow Jones U.S. Software Index.
On the other hand, energy stocks continued to turn in a strong performance amid a sharp increase by the price of crude oil, with the Philadelphia Oil Service Index surging by 3.5 percent and the NYSE Arca Oil Index climbing by 1.6 percent.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Tuesday, with Japanese markets closed for a holiday. Hong Kong’s Hang Seng Index slid by 0.7 percent, while South Korea’s Kospi climbed by 0.5 percent.
Meanwhile, European stocks moved mostly higher on the day. The French CAC 40 Index advanced by 0.5 percent and the German DAX Index rose by 0.4 percent, although the U.K.’s FTSE 100 Index bucked the uptrend and closed just below the unchanged line.
In the bond market, treasuries moved to the upside after showing a lack of direction earlier in the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 2.3 basis points to 4.120 percent.
Looking Ahead
A report on new home sales may attract some attention on Wednesday, although trading activity may be somewhat subdued ahead of the release of more closely watched data later in the week.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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