US Stocks Extend Recent Losses 12/06 15:59
Stocks closed broadly lower on Wall Street Tuesday, extending the market's
recent string of losses, as traders ponder the Federal Reserve's next moves in
its campaign to cool stubbornly hot inflation.
(AP) -- Stocks closed broadly lower on Wall Street Tuesday, extending the
market's recent string of losses, as traders ponder the Federal Reserve's next
moves in its campaign to cool stubbornly hot inflation.
The S&P 500 fell 1.4%, its fourth straight drop. The Dow Jones Industrial
Average fell 1% and the Nasdaq composite lost 2%.
Technology stocks, communication companies and retailers had some of the
biggest losses. Apple fell 2.5%, Disney slid 3.8% and AutoZone dropped 2.8%.
Small company stocks also fell, pulling the Russell 2000 index 1.5% lower.
The major indexes are on pace for a weekly loss after posting two straight
Bond yields fell. The yield on the 10-year Treasury slid to 3.52% from 3.58%
European markets ended mostly lower and Asian markets closed mixed.
Several companies made big moves following financial updates and buyout
Utility NRG Energy slumped 15.1% after announcing it is spending $2.8
billion in cash and assuming $2.4 billion in debt to buy Vivint Smart Home.
Jewelry company Signet vaulted 20.2% after raising its profit and revenue
forecasts for the year.
Roughly 80% of stocks in the S&P 500 fell, leaving the benchmark index down
57.58 points to 3,941.26. The Dow dropped 350.76 points to 33,596.34, while the
tech-heavy Nasdaq lost 225.05 points to close at 11,014.89.
The Russell 2000 slid 27.65 points to 1,812.58.
The broader market's dip comes a day after stocks pulled back as
stronger-than-expected readings on the economy raised worries that the Fed has
a ways to go in getting inflation under control. The Fed is doing that by
intentionally slowing the economy with higher interest rates.
"We've been in this period where investors have been anticipating now that
the Fed will back off pretty soon, they'll pause soon and probably even start
cutting rates in the back half of 2023," said Bill Merz, head of capital market
research at U.S. Bank Wealth Management.
"And then when we get the occasional robust jobs report and inflation report
that makes it clear that inflation remains quite problematic and it's not
decelerating as quickly as anyone would like," Merz said.
Investors are closely watching economic data and company announcements to
get a better sense of how the economy is handling stubbornly hot inflation.
They are also trying to determine whether inflation is easing at a pace that
will allow the Fed to ease up on interest rate increases. The Fed's policy
risks hitting the brakes on the economy too hard and sending it into a
The Fed is meeting next week and is expected to raise interest rates by a
half-percentage point. It has raised its benchmark rate six times since March,
driving it to a range of 3.75% to 4%, the highest in 15 years. Wall Street
expects the benchmark rate to reach a peak range of 5% to 5.25% by the middle
Wall Street will get a weekly update on unemployment claims on Thursday. The
job market has been one of the stronger pockets in the economy.
Investors will get important updates on inflation and how consumers are
dealing with high prices later in the week.
On Friday, the government will release its November report on producer
prices. That will give investors more insight into how inflation is impacting
The University of Michigan will release its December survey on consumer
sentiment on Friday.
With growing concerns about a recession, Fitch Ratings revised its forecasts
for world economic growth downward to reflect the Fed's and other central
banks' interest rate hikes.
The ratings agency's Global Economic Outlook report estimated global growth
at 1.4% in 2023, revised down from 1.7% in its September forecast. It put U.S.
growth in 2023 at 0.2%, down from 0.5%, as the pace of monetary policy