US stocks fell on Tuesday as a slowdown in retail sales led to a deluge of key data highlighted by the upcoming release of the monthly employment report.
The Dow Jones Industrial Average, which dominates the blue-chip index, held on to gains, rising 0.2%, while the S&P 500 lost about 0.1%. The Nasdaq Composite fell 0.2% due to fluctuations in major tech titans Nvidia ( NVDA ) and Alphabet ( GOOG ).
December’s retail sales data led the flood of economic data coming this week with negative ratings on the economy, as retail spending in the month was “virtually unchanged” from the previous month. Data on stagnant sales signal a slowdown in spending by the end of the holiday season compared to a monthly growth of 0.6% in November, and fell well below economists’ expectations.
The weak number appears to have increased bets on a rate cut by the Federal Reserve, SEEbiz reports. While most traders still expect the Fed to remain steady next month and April, that majority is shrinking. Meanwhile, over 75% of traders now expect interest rates to be lower by June.
The consumer data sets the stage for Wednesday’s all-important January employment report, which is under heavy scrutiny after last week’s signs of easing in the labor market. The latest CPI reading is due on Friday to look at inflationary pressures as the Fed continues to balance both sides of its dual mandate.
In the corporate world, investors looked over the latest series of quarterly earnings, including Coca-Cola ( KO ) and CVS Health ( CVS ). Ford (F) was the standout after the market closed on Tuesday.
Gold and bitcoin remain on investors’ radars as the assets try to stabilize after last week’s sharp decline. After rising above $5,000 earlier in the week, gold fell slightly early Tuesday morning, although strategists remain optimistic about its prospects for the year. But risk-averse sentiment weighed on bitcoin, which continued to slide and traded well below $69,000 before recovering slightly on Tuesday morning. The leading cryptocurrency has seen high volatility, fueled by what one analyst called a “crisis of confidence.”
