4:10pm: Nasdaq manages a winning session
The Dow closed Tuesday up 13 points, less than 0.1%, at 33,998, while the Nasdaq Composite declined 34 points, 0.3%, to 13,534 and the S&P 500 slid less than 1 point to 4,373. The small-cap Russell 2000 index gained 20 points, 1.1%, to 1,767.
Meanwhile, the 10-year Treasury yield climbed above 4.8%, its highest level since October 6.
“It’s more the bond market driving the stock market at this point,” said Chris Zaccarelli, chief investment officer of the Independent Advisor Alliance. “You’re seeing the trend that we’ve seen for the last two months reassert itself.”
Shares of Nvidia fell 4.7% after the US tightened export controls for cutting-edge artificial intelligence chips.
12:07pm: US stocks reverse early losses but tech lags
US stocks reversed early losses after strong retail sales figures showed the US economy remained resilient although tech stocks lagged.
At midday, the Dow Jones Industrial Average was up 125.61 points, 0.4%, at 34,110.15, the S&P 500 was up 13.17 points, 0.3%, at 4,386.80 and the Nasdaq Composite was up 7.60 points, 0.1%, at 13,575.58.
Semiconductor stocks were on the back foot after the US administration tightened export controls for cutting-edge artificial intelligence chips, in an update to existing rules that will severely limit the ability of Nvidia and other manufacturers to sell high-performance semiconductors to China.
Commerce Secretary Gina Raimondo said the goal of the update was to curb China’s access to advanced chips that “could fuel breakthroughs in artificial intelligence and sophisticated computers” that are critical for the Chinese military.
Nvidia fell 3.5% and Broadcom slipped 1.8%
9:44am: Nasdaq tumbles after strong retail sales
US stocks opened lower, and bond yields rose once more, as strong retail sales figures pushed the possibility of an interest rate hike back on the agenda.
Shortly after the opening bell, the Dow Jones Industrial Average was down 63.12 points, 0.2%, at 33,921.42, the S&P 500 was down 27.03 points, 0.6%, at 4,346.60 while the Nasdaq Composite was down 142.05 points, 1.1%, at 13,425.94.
Retail sales outstripped expectations last month as the US consumer shows continued resilience in the face of robust Federal Reserve interest rates.
According to the Census Bureau, retail sales increased 0.7% on-month in September, beating the FXStreet cited consensus of a 0.3% climb.
Growth eased from the 0.8% rise registered in August from July. August's reading was upwardly revised from a 0.6% rise.
On an annual basis, retail sales grew 3.8% in September, picking up speed from a 2.9% climb in August.
Michael Pearce at Oxford Economics said while “mounting headwinds to consumer incomes mean we expect spending growth to slow in the months ahead, the risks that spending contracts outright are fading.”
“The strength of the economy also means that Fed officials will leave the door open for additional rate hikes,” he felt.
The data followed some resilient looking earnings from Bank of America, up 0.5%, and Goldman Sachs, down 0.5% - both beat market expectations.
Johnson & Johnson (NYSE:JNJ), unchanged, was another updating investors today and the pharma giant raised guidance after a strong third quarter.
7:00am: Stocks called lower ahead of retail sales, earnings
US stocks are expected to open lower as investors await key economic and corporate updates as the earnings season swings into gear.
In pre-market trading, futures for the Dow Jones Industrial Average were 0.2% lower, while those for the S&P 500 fell 0.2%, and contracts for the Nasdaq 100 futures were down 0.2%.
Alongside the earnings releases, US retail sales figures will be scrutinised to see if the interest rate increases are hitting consumer spending.
Economists expect sales to have moderated to a 0.3% increase in September, following a 0.6% gain in August.
Otherwise, results from Johnson & Johnson (NYSE:JNJ), Bank of America, Lockheed Martin (NYSE:LMT) and Goldman Sachs (NYSE:GS) are among those to be released today.
J&J’s numbers are already out and the pharma giant has raised full-year guidance after a third quarter earnings and revenue beat.
Shares are up 1% in response.