US stocks fall amid caution over economic data

Bloomberg – US stocks fell on Tuesday as investors analyzed mixed economic data and amid concerns of a recession as a result of the Federal Reserve’s monetary tightening.

Both the S&P 500 and Nasdaq 100 are in the red after Monday’s gains. Treasuries are falling across the board And short-term yields, more sensitive to rate changes, rose more than five basis points.

Reports on Tuesday showed a bigger-than-expected decline in U.S. homebuilding, while U.S. factory output rose for the first time in three months in July.

In the corporate sector, Walmart Inc., after beating Wall Street’s earnings expectations and marginally improving its full-year forecast. (WMT) increased. Home Depot Inc. ( HD ) rises after maintaining its forecast for the year despite better-than-expected second-quarter earnings.

A sharp decline in New York state’s manufacturing sector, the second-worst reading since 2001, along with the longest streak of decline in homebuilder sentiment since 2007, fueled near-term optimism on Monday in the stock markets, given the possibility that The Federal Reserve will stop raising interest rates.

“We would caution investors against chasing this rally,” said Mark Heifel, chief investment officer at UBS Global Wealth Management (UBS). ,We expect more volatility in the markets and continue to recommend positioning portfolios for resistance in various scenarios. As inflation remains high, we favor value stocks, including global energy. And with the economic outlook uncertain, we believe investors may consider equity exposure through global healthcare or quality stocks.

On Wednesday, when the minutes of the last meeting of the Federal Open Market Committee (FOMC, for its acronym in English) are published, you can know clues about the sensitivity of the Federal Reserve to economic development data. Officials such as Esther George and Neil Kashkari are also scheduled to speak. However, the most important event for investors is the annual monetary policy symposium to be held in Jackson Hole, Wyoming, August 25-27. Traders are bracing for more volatility until then.

Europe’s Stoxx 600 index advanced for a fifth day, its longest streak since March, with commodity producers and utilities posting some of the biggest gains.

West Texas Intermediate (WTI) futures rose slightly but traded below $89 a barrel, down nearly 5% in the past two sessions. Aside from economic concerns, investors also face the possibility of increased supply due to sluggish demand.

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