U.S. stocks opened lower again on Wednesday as concerns about the impasse in the debt-ceiling talks in Washington unnerved investors.
How are stock indexes trading
-
The Dow Jones Industrial Average
DJIA,
-0.62%
fell 108 points, or 0.3% to about 32,957 -
The S&P 500
SPX,
-0.72%
dipped 19 points, or 0.5% to about 4,127 -
The Nasdaq Composite
COMP,
-0.70%
lost 57 points, or 0.5% to 12,506
On Tuesday, the Dow Jones Industrial Average fell 231 points, or 0.69%, to 33056, the S&P 500 declined 47 points, or 1.12%, to 4146, and the Nasdaq Composite dropped 161 points, or 1.26%, to 12560.
What’s driving markets
Stocks fell Wednesday morning, extending Tuesday’s 1.1% sell-off for the S&P 500
SPX,
which came after reports suggested talks to extend the U.S. government debt ceiling were at an impasse.
“Positive sentiment is being restrained by shackles of uncertainty as the U.S. debt ceiling negotiations continue without agreement,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
As the debt ceiling standoff continues, “investors are likely to continue to see the behavior we’ve seen recently,” said Kristina Hooper, chief global market strategist at Invesco US.
“Stocks go up when the talk is positive. When the discussions are stalled, stocks go down. Well the bond market continues to show concerns,” said Hooper in a call.
European stocks were also lower on Wednesday, while U.K. government bond yields rose
TMBMKGB-02Y,
after data showed inflation in Britain slowing to 8.7% in April, but was still higher than expected.
The stubbornly high inflation in the U.K. pushed expectations for the Bank of England’s peak interest rate to 5.5%, from the current 4.5% and reminded investors more broadly that the global battle against inflation was not done.
With that in mind, the minutes of the Federal Reserve’s policy meeting in May will be released at 2 p.m. Eastern.
Nvidia
NVDA,
will deliver its results after the closing bell. The chip company’s shares are seen as having benefited of late by excitement over AI, and so investors will be keen to hear whether their hopes match reality.
“The debt ceiling negotiations are still hanging over the U.S. equity market as dark clouds with no breakthrough yet, but with the VIX Index at around 18.5, the options market is still quite relaxed, but things can change fast as we approach the 1 June deadline,” said Peter Ganry, head of equity strategy at Saxo Bank.
Companies in focus
-
Abercrombie & Fitch Co.
ANF,
+21.25%
jumped 21% Wednesday, after the specialty apparel and accessories retailer reported a surprise fiscal first-quarter profit, amid strength in its Abercrombie brand. -
Kohl’s Corp.
KSS,
+8.72%
shot up after the department-store chain also reported a surprise fiscal first-quarter profit, even as sales fell a bit below forecasts. -
Palo Alto Networks Inc. shares
PANW,
+7.41%
rose after the cybersecurity company turned in another beat-and-raise quarter and its CEO Nikesh Arora forecast the software industry would be transformed by AI over the next 12 to 24 months. -
Intuit Inc. stock
INTU,
-6.96%
dropped 7% Wednesday after the Turbo Tax parent reported a narrow revenue miss for its fiscal third quarter, and raised guidance. -
PacWest Bancorp
PACW,
-2.04%
shares dipped 1.2% after saying it will sell its real-estate lending arm to Roc360 for an unspecified sum, as the beleaguered regional bank moves to refocus on its core business.
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