Wall Street Close: Snaps five-day uptrend as China probes bulls ahead of Fed
- US equities retreat despite upbeat earnings from the key technology companies.
- Beijing’s crackdown on technology, education stocks joined upbeat US data to trigger market’s consolidation.
- Microsoft, Apple, Alphabet all marked upbeat earnings but couldn’t save respective shares.
- Fed’s move will be the key Amazon earnings are important as well.
US equities paused a five-day march, technology stocks dropped even more, by the end of Tuesday’s North American session. The shares failed to keep the bulls happy even as key tech giants marked strong quarterly results and the US data came in below market expectations.
The reason could be linked to China’s strong regulatory announcements for the IT and education companies as well as the upwardly revised prior figures of the US data that supersede the latest soft prints. Additionally, a deadlock over US President Joe Biden’s infrastructure spending bill and cautious sentiment ahead of the Federal Reserve (Fed) verdict also weigh on the market sentiment and drag the Wall Street.
Read: Forex Today: Dollar weaker as Fed looms
Amid these plays, Dow Jones Industrial Average (DJI) dropped 0.24% or 85.79 points to 35,058 whereas S&P 500 Futures slipped 0.47% to 4,401. Nasdaq, however, is the worst affected one with a downside of 1.21% or 180.01 points to 14,660.
Apple, Google-parent Alphabet and Microsoft all posted crossed market expectations to the north but concerns over the supply shortage and slightly cautious comments seemed to have disappointed the bulls. It’s worth mentioning that the tech sell-off was all-pervasive as Intel Corp shares dropped over 2.0% despite the firm’s announcement to build Qualcomm chips.
On a broader front, US 10-year Treasury yields dropped 3.7 basis points (bps) to 1.239% whereas prices of commodities and Antipodeans also stayed pressured by the end of Tuesday’s North American trading session.
Looking forward, Wednesday could be a choppy session ahead of the Federal Open Market Committee (FOMC) decision. Although the US central bank isn’t expected to alter the current monetary policy, equity bears are looking for the policymakers’ hawkish tilt to tighten the grips.
Read: Federal Reserve Preview: Three reasons why Powell could pause, pummeling the dollar