Stock market dips in wide selloff following 2 weeks of gains


Major stock indexes on Wall Street closed lower Tuesday, giving back some of their recent gains as traders returned from a long holiday weekend.

The S&P 500 fell 0.4%, while the Nasdaq composite slipped 0.1%. Both indexes were coming off their second weekly gain. The Dow Jones Industrial Average lost 0.6%.

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A street sign is seen June 14, 2022, in front of the New York Stock Exchange.

The selling was widespread, with decliners outnumbering advancers by more than 3 to 1 on the New York Stock Exchange.

Losses in industrial, health care and financial stocks were the biggest drag on the benchmark S&P 500. Technology stocks were the biggest bright spot.  

Energy stocks rose along with crude oil prices after Saudi Arabia and Russia said they will extend their voluntary production cut of 1 million barrels of oil a day through the end of the year. U.S. crude oil prices rose 1.3% and Chevron rose 1.3%.

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Smaller company stocks also lost ground, sending the Russell 2000 index 2.1% lower.

The yield on the 10-year Treasury rose to 4.27% from 4.18% late Friday. The yield on the 2-year Treasury rose to 4.96% from 4.88%.

Coming off the Labor Day holiday, investors have few economic reports to look forward to this week, while the latest round of corporate earnings is essentially finished.

The Institute for Supply Management releases its latest report on the U.S. services sector Wednesday. The services sector employs the most Americans and is a big component of the economy. Its health could provide more insight into how inflation is affecting consumer spending.

Wall Street will also get updates on aspects of the manufacturing sector and consumer credit.  

Last week, investors were busy reviewing a heavy load of economic data as they try to get a better picture of the economy. Much of the information fueled hopes that the Fed might moderate interest rate increases to fight inflation, which has been easing for months.

Wall Street expects the Fed to hold its benchmark interest rate steady at its next meeting in September, just as it did at its previous meeting. Investors are mostly betting that the central bank will maintain that pause through the rest of the year.

The central bank has raised its main interest rate aggressively since 2022 to the highest level since 2001. The goal has been to rein inflation back to the Fed’s target of 2%.  

Analysts are still concerned about the potential for a recession, but those concerns have lessened as inflation cools and the economy remains resilient.

All told, the S&P 500 fell 18.94 points to 4,496.83 Tuesday. The Dow dropped 195.74 points to 34,641.97, and the Nasdaq slipped 10.86 points to 14,020.95. The Russell 2000 slid 40.38 points to 1,880.45.


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Stock market dips in wide selloff following 2 weeks of gains

2023-09-05 21:30:00

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