US stocks slid on Tuesday, pulling further back from record highs as uncertainty over interest rate cuts and the continued strength of tech stocks brought a note of wariness to the market.
The S&P 500 (^GSPC) slipped about 0.4%, while the Dow Jones Industrial Average (^DJI) moved roughly 0.3% lower after a losing start to the week. Contracts on the tech-heavy Nasdaq Composite (^IXIC) sank around 0.8% as a continued retreat in Apple (AAPL) and Tesla (TSLA) continued to drag on stocks more widely.
The debate now is whether the tech gains behind the recent record-setting stock rally have reached their peak, as downbeat news saps the “FOMO” — fear of missing out — seen as keeping investors engaged.
In early trading, Apple came under pressure after a report that iPhone sales fell 24% in China, adding to Monday’s loss in the wake of a $2 billion EU antitrust fine. Tesla continued to slump as a shutdown at its Berlin Gigafactory added to concerns over a shipment slump and a Chinese price war.
At the same time, faith in coming easing by the Federal Reserve took a knock after comments by policymaker Raphael Bostic. The Atlanta Fed president said he sees just one rate cut this year, penciled in for the third quarter.
Investors are now even more focused on Fed Chair Jerome Powell’s testimony to Congress on Wednesday. His words will be closely watched for any change in the mantra that policymakers need to be convinced inflation is conquered before any move.
Meanwhile, bitcoin (BTC-USD) briefly touched $68,000 overnight but has lost ground amid the cautious mood to trade at above $67,000. The biggest cryptocurrency remains within striking distance of a fresh all-time high, which would be above $68,789.
In corporates, Target (TGT) earnings beat Wall Street forecasts, helping shares pop more than 10% in early market trading.
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