4:16pm: Walgreens, Caterpillar fall
The Dow closed Wednesday down 94 points, 0.3%, at 37,267, the Nasdaq Composite fell 89 points, 0.6%, to 14,886 and the S&P 500 lost 27 points, 0.6%, to 4,379. The small-cap Russell 2000 index slid 15 points, 0.8%, to 1,912.
The Dow notched its third-consecutive losing session and the 10-year Treasury yield rose 12 basis points to 4.11% as pessimism continued over when the Federal Reserve will implement rate cuts this year.
“By the end of this year, rates will likely be lower than they are now — but it’s not going to be a straight line,” said Thomas Martin, senior portfolio manager at Globalt Investments, as reported by CNBC.
“In the meantime, people who are positioned aggressively for more rate declines and for higher stocks, are maybe pulling in their horns and getting a little bit more diversified. You do want to hold bonds, but you also want to hold stocks,” he added.
Walgreens Boots Alliance Inc (NASDAQ:WBA) and Caterpillar Inc (NYSE:CAT, ETR:CAT1) were among the Dow's laggards, each falling more than 3%.
12:00pm: Blue-chips rally from early lows but rate-sensitive tech stocks suffer
Blue-chips pulled off early lows but rate-sensitive tech stocks suffered as investors continued to debate just when interest rates will be cut.
At midday, the Dow Jones Industrial Average was down 35.62 points, 0.1%, at 37,325.50, the S&P 500 was down 28.06 points, 0.6%, at 4,737.92 and the Nasdaq Composite was down 133.65 points, 0.9%, at 14,810.70.
Strong retail sales figures added to data showing the economy remains resilient in the face of interest rate increases.
James Knightley at ING pointed out: "The jobs market is tight, inflation is above target, consumer spending is holding up and recent Fed commentary suggests they are in no hurry to loosen policy. As such we continue to favour May as the start point for interest rate cuts rather than March as the market currently favours."
Attention will now focus on the release of the Fed's Beige Book for further signals as to the strength of the world's largest economy.
9:40am: Stocks slip again after strong retail sales
Stocks in New York fell further on Wednesday as strong retail figures added to concerns that interest rate cuts may come, later, rather than, sooner.
Shortly after the opening bell, the Dow Jones Industrial Average was down 116.78 points, 0.3%, at 37,244.34, the S&P 500 was down 33.85 points, 0.7%, at 4,732.32 and the Nasdaq Composite was down 173.76 points, 1.2%, at 14,770.59.
Retail sales rose at a faster rate than expected, according to new data on Thursday, showing the US economy remains resilient in the face of interest rate rises.
According to the Census Bureau, US retail sales rose by 0.6% in December from November, stronger than the 0.4% increase that was forecast.
Ex-automobiles, sales rose by 0.4% on-month in December, compared to a 0.2% in November from October, and the 0.2% predicted by economists.
Kieran Clancy at Panthen Macroeconomics said the report is "much stronger than we expected."
"These data don't change our call that the Fed will start to ease in March, because they will be responding to much lower inflation rather than weaker growth, but more reports like this would increase the risk of a delay until May," he added.
7:00am: Stocks set for further falls ahead of retail sales
Stocks in New York look set to open lower on fading hopes for a March interest rate ut and ahead of retail sales figures before the market open.
In pre-market trading, futures for the Dow Jones Industrial Average were down 0.4%, while those for the S&P 500 were down 0.4% and contracts for the Nasdaq 100 futures also fell 0.4%.
On Tuesday, stocks fell after Federal Reserve Governor Christopher Waller said the central bank should not rush to cut its benchmark interest rate until it is clear lower inflation will be sustained.
In a speech, Waller said regardless of when rate cuts begin, the US central bank should proceed "methodically and carefully."
“I see no reason to move as quickly or cut as rapidly as in the past," he said.
Retail sales are forecast to have risen by 0.4% in December, after a 0.3% increase in November, as the economy remains resilient in the face of higher interest rates.
Later in the session, the US Federal Reserve will release its latest “Beige Book”, an anecdotal assessment of economic conditions gathered by each central bank branch.
While, there will be more Fedspeak as Fed governor Michelle Bowman joins in a fireside chat at a US Chamber of Commerce’s event.
On the earnings front, look out for numbers from Charles Schwab.