US stocks retreat after robust economic data
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Traders work on the floor of the New York Stock Exchange, during afternoon trading on Jan 17, 2024 in New York City.
PHOTO: AFP
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NEW YORK - Wall Street stocks lost ground on Jan 17, after stronger than anticipated retail sales data weighed on hopes that the Federal Reserve would cut interest rates sooner rather than later.
Retail sales in the world’s biggest economy picked up by 0.6 per cent from November to December, closing out a year marked by resilient consumer demand, government data showed.
“The key takeaway from the report is that consumer spending remained healthy in the final month of 2023, which does not strengthen the argument for an imminent start to a rapid rate cut campaign” by the Fed, said Briefing.com in a note.
The Dow Jones Industrial Average slipped 0.3 per cent to 37,266.67, while the broad-based S&P 500 ended 0.6 per cent lower at 4,739.21.
The tech-heavy Nasdaq Composite Index also shed 0.6 per cent to 14,855.62.
“I think we are seeing the market readjusting to the hype of a cut rate in March,” said Mr Peter Cardillo, of Spartan Capital.
He added that a March rate cut is likely “off the table” give the economy’s performance and the way central bank officials have talked about cautiousness in lowering rates.
On Jan 17, the Fed released its latest “beige book” update of economic conditions, noting that economic activity remained largely unchanged in recent weeks.
But US businesses say they are optimistic about the prospect of falling interest rates, according to the report.
Among individual companies, aviation giant Boeing saw its shares rise by 1.3 per cent.
This came a day after shares sank nearly 8 per cent as the company announced an independent review of quality control functions following a near-catastrophic incident on a 737 Max jet. AFP
