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US STOCKS-Wall St declines, with investors on edge before CPI data Friday

reuters.com · 06/09/2022 15:03
US STOCKS-Wall St declines, with investors on edge before CPI data Friday

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10-Year Treasury yield up at 3.04%; Brent above $123 a barrel

CPI data due Friday

Indexes down: Dow 0.7%, S&P 500 1%, Nasdaq 1.3%

Updates to late afternoon, adds NEW YORK dateline

By Caroline Valetkevitch

- U.S. stocks were solidly lower on Thursday in a broad decline as investors grew cautious ahead of data on Friday that is expected to show that consumer prices remained high in May.

All 11 of the S&P 500 sectors were in negative territory by afternoon, with the communication services sector .SPLRCL down the most.

Adding to nervousness, the benchmark U.S. 10-year Treasury yield US10YT=RR climbed to as much as 3.073%, its highest level since May 11.

Also, Brent crude oil prices LCOc1 held near $123 a barrel, helping to keep investors on edge before Friday's U.S. consumer price index report.

The data is expected to show that consumer prices rose 0.7% in May, while the core consumer price index (CPI), which excludes the volatile food and energy sectors, rose 0.5% in the month.

"We're getting prepared for what the news might be regarding inflation tomorrow," said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

"I view it as mixed. If the total is high and the core number shows some sort of drop, I actually think the markets could rally on that because it'll show that things are kind of rolling over a bit."

The Dow Jones Industrial Average .DJI fell 226.31 points, or 0.69%, to 32,684.59; the S&P 500 .SPX lost 39.66 points, or 0.96%, to 4,076.11; and the Nasdaq Composite .IXIC dropped 159.37 points, or 1.32%, to 11,926.91.

Investors have worried that rising inflation could keep the Federal Reserve on an aggressive path in raising interest rates.

The U.S. central bank has raised its short-term interest rate by three-quarters of a percentage point this year and intends to keep at it with 50 basis points increases at its meeting next week and again in July. nL1N2XN28A

Alibaba Group BABA.N slid 7% after its affiliate Ant Group said it has no plan to initiate an initial public offering. nP8N2XM024

Declining issues outnumbered advancing ones on the NYSE by a 3.77-to-1 ratio; on Nasdaq, a 2.33-to-1 ratio favored decliners.

The S&P 500 posted one new 52-week high and 30 new lows; the Nasdaq Composite recorded 16 new highs and 101 new lows

(Additional reporting by Devik Jain and Mehnaz Yasmin in Bengaluru and Chuck Mikolajczak in New York; Editing by Arun Koyyur, Sriraj Kalluvila and Jonathan Oatis)