US STOCKS-Wall Street dips as investors eye inflation clues

  • 5/25/2021
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(For a Reuters live blog on U.S., UK and European stock markets, click LIVE/ or type LIVE/ in a news window.) * Boeing rises on 14 new orders for 737 MAX jets * Lordstown slumps after halving truck production target * Dow down 0.14%, S&P 500 down 0.15%, Nasdaq down 0.01% (Updates to midday, changes byline) May 25 (Reuters) - Wall Street’s main indexes held close to the unchanged mark on Tuesday, oscillating between minor gains and losses following a rally in the prior session as investors continue to try and assess the trajectory of inflation. Yields on longer-dated U.S. Treasuries fell for a fourth straight day, with the benchmark 10-year yield hitting a fresh two-week low of 1.564% and helping to ease inflation worries. The yield had climbed to as much as 1.776% at the end of March. Federal Reserve officials continue to downplay rising price pressures, and Fed Vice Chair Richard Clarida said the central bank can take steps to cool a jump in inflation, if it occurs, without derailing the economic rebound coming out of the coronavirus pandemic. While most market participants expect prices to increase as the economy recovers, concerns about the speed and trajectory of the rise persist. “On balance the market is probably due for a sideways trending mode here now with first quarter results largely in the bank,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis, Minnesota. “If you look at concerns on the horizon, clearly inflation is one of them but the bond market is not signaling widespread concerns of inflation.” The Dow Jones Industrial Average fell 47.07 points, or 0.14%, to 34,346.91, the S&P 500 lost 6.43 points, or 0.15%, to 4,190.62 and the Nasdaq Composite dropped 1.06 points, or 0.01%, to 13,660.11. Energy, down 1.85%, was the weakest sector on the day Exxon Mobil Corp fell 2.38% as the biggest weight on the S&P 500, after sources said BlackRock Inc has backed several candidates of hedge fund Engine No. 1 to join the energy giant’s board. Real estate, up 0.41%, was a bright spot, benefiting from the pause in yields. Data on Tuesday showed sales of new U.S. single-family homes dropped in April as prices surged amid a tight supply of houses, while a separate report showed U.S. consumer confidence was little changed and near last month’s number that was the highest reading since February 2020. The S&P 500 sits about 1% from its May 7 all-time high as the focus turns to the U.S. Personal Consumption Expenditures report, the Fed’s preferred measure of inflation, to be released on Thursday. A much stronger than expected reading on consumer prices two weeks ago re-ignited inflation fears and stoked market volatility. Airline stocks, part of the “reopening” trade, rose after United Airlines and Hawaiian Holdings issued upbeat air traffic and ticket sale estimates that sent their shares up 2.3% and 5.2%, respectively. The S&P 1500 airlines index added about 1.1%. Boeing gained 1.9% after aircraft leasing business SMBC Aviation Capital agreed to buy 14 more 737 MAX jets. Lordstown Motors Corp slumped -7.5% after the electric vehicle startup said that 2021 production of its Endurance truck would be half of prior expectations and it needs additional capital to execute its plans. Declining issues outnumbered advancing ones on the NYSE by a 1.22-to-1 ratio; on Nasdaq, a 1.28-to-1 ratio favored decliners. The S&P 500 posted 29 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 70 new highs and 43 new lows. (Reporting by Chuck Mikolajczak; Editing by Aurora Ellis) Our Standards: The Thomson Reuters Trust Principles.

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