S&P 500 slips as rates hawkish, labor data weighs

  • Fed’s Bullard backs further rate hikes
  • Cisco rises after Co raises full-year outlook
  • Macy’s jumps on raising its earnings forecast
  • Indices: Dow up 0.07%, S&P down 0.23%, Nasdaq down 0.09%

Nov 17 (Reuters) – The S&P 500 fell slightly on Thursday as hawkish comments from a U.S. Federal Reserve official and data showing the labor market remained tight led some investors to worry about a further rise. aggressive interest rates.

Stocks fell sharply at the start of the session, then rebounded as the Dow rose slightly, supported by an upbeat earnings outlook from Cisco Systems (CSCO.O).

Stocks have fallen in recent days after a strong month-long rally after weaker-than-expected inflation reports raised hopes the Fed would moderate its rate hikes.

“Hope is eternal in the equity market, and the markets battled against the Fed,” said Sameer Samana, senior global markets strategist at Wells Fargo Investment Institute in St. Louis.

“You’ve had these turnarounds, you’ve had these dramatic rallies. But yet when you look at the whole of 2022, you’ve had lower highs and lower lows and there’s no suggestion that we’ve broken that pattern. “

The Dow Jones Industrial Average (.DJI) rose 22.8 points, or 0.07%, to 33,576.63, the S&P 500 (.SPX) lost 9.27 points, or 0.23%, to 3,949.52 and the Nasdaq Composite (.IXIC) fell 9.73 points, or 0.09%, to 11,173.93.

St. Fed Chairman James Bullard said the central bank needed to keep raising rates given that its tightening so far “has had only limited effects on observed inflation.”

Data showed the number of Americans filing new claims for unemployment benefits fell last week, suggesting the labor market remained tight, after a report on Wednesday detailed strong growth in sales in the detail last month indicating that the economy has resisted rate hikes.

Traders’ bets on a 75 basis point hike at the next Fed meeting soared to 19% from around 15% a day earlier, according to CME Group’s FedWatch tool, with the remaining odds placed on a smallest increase of 50 basis points.

Shares of Cisco rose more than 4% after the company raised its full-year revenue and profit forecast as supply chain hurdles eased. The stock contributed to a 0.3% rise in the heavyweight S&P 500 information technology sector (.SPLRCT).

However, most S&P 500 sectors were down, with Utilities (.SPLRCU) and Materials (.SPLRCM) both down about 1.4%.

In other corporate news, Macy’s (MN) shares jumped more than 14% after the department store chain raised its full-year profit forecast on resilient demand for top apparel and beauty products. of range.

Falling issues outnumbered rising ones on the NYSE by a ratio of 2.54 to 1; on the Nasdaq, a ratio of 1.83 to 1 favored the decliners.

The S&P 500 posted no new 52-week highs and 1 new low; the Nasdaq Composite recorded 28 new highs and 144 new lows.

Reporting by Lewis Krauskopf in New York, Bansari Mayur Kamdar, Ankika Biswas and Amruta Khandekar in Bengaluru; Editing by Vinay Dwivedi, Arun Koyyur and David Gregorio

Our standards: The Thomson Reuters Trust Principles.

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