Wall Street stocks end lower as Oracle’s weak forecast and rising oil prices weigh
Wall Street stocks ended lower on Tuesday, with Oracle shares tumbling more than 13% after a weak forecast and surging oil prices deepening worries about persistent price pressures ahead of crucial inflation readings this week.
The S&P 500 declined 0.57% to end the session at 4,461.91 points, while the Nasdaq declined 1.04% to 13,773.62 points. The Dow Jones Industrial Average declined 0.05% to 34,645.99 points.
Oracle shares dived to their lowest since June after the cloud-services provider forecast current-quarter revenue below targets and narrowly missed first-quarter expectations. Cloud-computing heavyweights Amazon.com and Microsoft each fell more than 1%, pressured by Oracle’s weak forecast and by a rise in U.S. Treasury yields.
Oil prices jumped more than 1%, building on a recent rally and stoking worries that sticky inflation could mean U.S. interest rates stay higher longer in the aftermath of strong economic data.
Investors are awaiting August consumer price index data due on Wednesday and producer prices reading scheduled for Thursday to gauge the outlook for U.S. interest rates ahead of the Fed’s meeting on Sept. 20.
Interest rate traders see a 93% chance of rates remaining at the current levels in September but just a 56% likelihood of a pause at the November meeting, according to the CME FedWatch Tool.
“All the all the inputs that we get between now and the November meeting will be important, especially those related to inflation. So that thrusts a lot of importance on tomorrow’s CPI report,” said Art Hogan, chief market strategist at B Riley Wealth.
Investors will also monitor the European Central Bank’s policy decision on Thursday, when it is seen holding rates after nine consecutive hikes.
Apple dropped 1.8% after unveiling new iPhones, while not increasing prices as it faces a global smartphone slump. The stock was also hurt by a report that China’s Huawei Technologies has raised the second-half shipment target for its Mate 60 series smartphone by 20%.
Here are some key takeaways from the article:
- Wall Street stocks ended lower on Tuesday, with the S&P 500 down 0.57%, the Nasdaq down 1.04%, and the Dow Jones Industrial Average down 0.05%.
- The decline was led by Oracle shares, which tumbled more than 13% after the cloud-services provider forecast current-quarter revenue below targets.
- Rising oil prices also weighed on sentiment, as investors worried that persistent inflation could lead to higher interest rates.
- Investors are awaiting August consumer price index data due on Wednesday and producer prices reading scheduled for Thursday to gauge the outlook for U.S. interest rates.
- Investors will also monitor the European Central Bank’s policy decision on Thursday, when it is seen holding rates after nine consecutive hikes
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