4:14pm: Tech stocks struggle
The Dow closed Tuesday down 18 points, less than 0.1%, at 34,646, the Nasdaq Composite lost 144 points, 1%, to 13,774 and the S&P 500 declined 26 points, 0.6%, to 4,462. The Russell 2000 index slid less than a point to 1,855.
Oracle led the tech-centric Nasdaq's decline. Shares of the computer technology company swooned 13% on disappointing earnings and soft guidance.
“Oracle, which isn’t a super large stock, but it is a look into the spending of businesses — and larger businesses at that — disappointed today, and that’s one of the factors that are suppressing both the NASDAQ and the S&P,” said Kim Forrest, founder at Bokeh Capital Partners.
Apple, which unveiled the iPhone 15 at its fall event Tuesday, saw its shares fall 1.7%.
Investors are also looking ahead to the consumer prices index figures on Wednesday which will provide food for thought for the data dependent US central bank.
12:00pm: US stocks mixed ahead of inflation figures
US stocks were mixed at lunchtime, with blue chips making steady progress, but tech stocks pausing for breath after strong gains on Monday.
At midday, the Dow Jones Industrial Average was up 56.45 points, 0.2%, at 34,720.17, the S&P 500 was down 14.05 points, 0.3%, at 4,473.41 and the Nasdaq Composite was down 93.30 points, 0.7%, at 13,824.59.
Investors are eyeing August's consumer prices data due on Wednesday and producer prices reading scheduled for Thursday, which will be followed by the Fed's policy decision on September 20.
Stocks on the move include WestRock which is up 3% after it confirmed its merger with Ireland's Smurfit Kappa while Cintas (NASDAQ:CTAS) is 2.9% to the good after Bank of America upgraded to buy from neutral on higher confidence in a potential US economic soft landing and increased estimates.
"We think Cintas (NASDAQ:CTAS) is poised for EPS beats driven by sales and margin outperformance," BofA said.
It also raised its price target to $580 from $523.
9:40am: US stocks ease ahead of inflation figures
US stocks paused for breath on Tuesday ahead of key economic updates later this week, and as Apple prepared for its annual fall event, this year called "Wonderlust."
Shortly after the opening bell, the Dow Jones Industrial Average was down 25.23 points, 0.1%, at 34,638.49, the S&P 500 was down 9.84 points, 0.2%, at 4,477.62 and the Nasdaq Composite eased 44.35 points, 0.3%, to 13,873.54.
In the only economic data point of note, the NFIB Small Business Index nudged lower to 91.3, down 0.6 points and slightly below the Dow Jones estimate of 91.5.
Investors are looking ahead to the consumer prices index figures on Wednesday which will provide food for thought for the data dependent US central bank.
The data will be followed the next day by August producer prices and retail sales numbers, data that may impact the Federal Reserve's thinking ahead of its policy deliberations next week and at its next meeting in November.
"[G]iven persistent pressures on service prices, the resurgence of oil prices, and the diminishing impact of favorable base effects, it appears unlikely that headline inflation will return to the desired 2% target any time soon. Hence, the path ahead remains challenging, and the Federal Reserve still faces a lengthy journey in its efforts to stabilize the economy," SPI Asset Management said.
Goldman Sachs (NYSE:GS) expects a 0.24% increase in August core CPI (vs. 0.2% consensus), corresponding to a year-over-year rate of 4.30% (vs. 4.3% consensus).
It expects a 0.63% increase in August headline CPI (vs. 0.6% consensus), which corresponds to a year-over-year rate of 3.58% (vs. 3.6% consensus).
"Going forward, we expect monthly core CPI inflation to remain in the 0.2-0.3% range in the next few months," Goldman said.
"We expect continued moderation in shelter inflation and lower used car prices to be offset by a swing in the CPI’s health insurance component," it added.
Stocks on the move include Acelyrin fell 59% after the company disclosed that its skin drug candidate's primary endpoint by week 16 of a Phase 2b/3 trial didn't meet statistical significance.
Alphabet fell 0.5% as the Justice Department's long-anticipated antitrust case against Google, which accuses the company of illegally monopolizing the internet search market, begins Tuesday in Washington.
Oracle tumbled 11.2% after its CEO told analysts on a conference call that the company expected second-quarter earnings of $1.30 to $1.34 a share on revenue of $12.89 billion to $13.13 billion.
Analysts had been forecasting earnings of $1.34 a share on revenue of $13.28 billion.
7:00am: US expected to open lower after strong Monday
US stocks are expected to open lower, consolidating gains after a strong run on Monday, as investors look ahead to the consumer prices print on Wednesday.
In pre-market trading, futures for the Dow Jones Industrial Average were 0.1% lower, while those for the S&P 500 fell 0.2%, and contracts for the Nasdaq 100 futures were down 0.2%.
Inflation figures will likely shape direction for the rest of the week with the consumer price index released on Wednesday and the producer price index slated for Thursday.
Retail sales figures will also be reported Thursday.
The CME’s FedWatch tool shows a 93% probability that the central bank will keep interest rates steady at its next meeting, and investors will be hoping that the water is not muddied by a hot inflation print.
The Wall Street Journal reported Sunday that there was a consensus within the Fed to not hike rates this month and less urgency for additional hikes later this year.
In company news, Alphabet’s Google arm is facing the biggest tech antitrust lawsuit brought by the US government in 25 years, with a trial starting today looking at whether the search company illegally shut out competitors.
Other stocks in focus include Apple is expected to unveil the iPhone 15 at the company’s annual fall event, called “Wonderlust,” and Oracle which is down 9% in pre-market trading after it reported a fall in cloud licensing revenue.