NEW YORK, Jul 5 (Reuters) – The S&P 500 closed slightly higher on Tuesday as investors kept their focus on the U.S. economy’s growth trajectory, with the tech-heavy Nasdaq closing higher while the Dow Jones fell.
US stocks have been under relentless selling pressure this year, with the benchmark S&P 500 (.SPX) posting its steepest first-half percentage decline since 1970, as the Fed backs away from easy-money policy by raising borrowing costs.
Investors are awaiting minutes from the Fed’s June meeting on Wednesday as they brace for another 75 basis point rate hike later in the month.
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Traders are also keeping an eye on economic data, including a June nonfarm payrolls report expected on Friday, and company comments on signs of peaking inflation and cooling economic growth, with another season of profit around the corner.
The data showed that new orders for US-made products rose more than expected in May, reflecting that demand for products remains strong even as the Fed seeks to cool the economy. read more
Meanwhile, business growth in the euro zone slowed further in June and natural gas prices in Europe rose again, reigniting fears of a recession in the bloc. read more
A Wall Street sign outside the New York Stock Exchange in New York City, New York, U.S., October 2, 2020. REUTERS/Carlo Allegri
“The risks of an outright recession are non-zero and the probability is growing at this point that a recession could emerge later this year, or perhaps even as early as 2023,” said Bill Northey, senior investment director at US Bank Wealth Management in Minneapolis. “And the US job market continues to look pretty healthy.”
The Dow Jones Industrial Average (.DJI) fell 129.44 points, or 0.42%, to 30,967.82, the S&P 500 (.SPX) gained 6.06 points, or 0.16%, to 3,831.39 and the Nasdaq Composite (.IXIC) it added 194.39 points, or 1.75%, to 11,322.24.
Benchmark US Treasury yields fell on Tuesday and a key part of the yield curve inverted for the first time in three weeks as economic growth concerns dampened risk appetite and boosted demand. of US safe-haven debt.
Eight of the 11 major S&P sectors finished lower, with communication services (.SPLRCL) leading the winners and energy (.SPNY) Posting the biggest percentage drop, hitting five-month lows as recession fears dimmed the outlook for oil demand.
Volume on US stocks was 12.39 billion shares, compared to the 13.03 billion average for the entire session over the past 20 trading days.
Down issues outnumbered up ones on the New York Stock Exchange by a ratio of 1.33 to 1; on Nasdaq, a ratio of 1.37 to 1 favored advancers.
The S&P 500 posted 1 new 52-week high and 51 new lows; The Nasdaq Composite posted 13 new highs and 308 new lows.
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Reporting from Echo Wang in New York; Additional reporting by Amruta Khandekar and Shreyashi Sanyal in Bengaluru Editing by Shounak Dasgupta and Matthew Lewis
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