NEW YORK – Wall Street stocks fell on Tuesday, extending an equity downturn as worries about tightening central bank policy and Europe’s energy woes offset good US economic data.
The American services sector expanded in August, defying expectations for a slowdown amid signs of easing supply issues and slowing price gains.
Countering that positive was ongoing angst about the difficult energy picture facing Europe after Russia continued the suspension of natural gas deliveries to Germany through the Nord Stream pipeline.
Investors also remain nervous over the Federal Reserve’s plans to continue its policy of aggressively hiking interest rates to combat inflation.
“Stocks are going to struggle because too much of the economy is doing well and that leaves Wall Street vulnerable to an extended period of rising interest rates,” said Oanda’s Edward Moya.
“The dovish pivot and the end of interest rate hikes with the December FOMC is not how this will play out.” The Dow Jones Industrial Average lost 0.6 per cent to end at 31,145.30.
The broad-based S&P 500 fell 0.4 per cent to 3,908.19, while the tech-rich Nasdaq Composite Index slid 0.7 per cent to 11,544.91.
Among individual companies, Signify Health rose 1.1 per cent after announcing a deal to be acquired by CVS Health for about US$8 billion (S$11 billion). CVS dipped 0.7 per cent.
Bed Bath & Beyond slumped 18.4 per cent in the aftermath of the suicide of chief financial officer Gustavo Arnal. The slumping retailer named Laura Crossen as acting CFO.