Wall Street ends lower as investors digest economic data

  • U.S. producer prices rise in November
  • Consumer sentiment improves in December
  • Lululemon tumbles after pessimistic forecast
  • Indices close: S&P 500 -0.73%, Nasdaq -0.70%, Dow -0.90%

Dec 9 (Reuters) – Wall Street ended lower on Friday as investors weighed economic data and awaited a potential 50 basis point interest rate hike by the U.S. Federal Reserve at its policy meeting next week, while clothing company Lululemon collapsed following disappointing earnings forecasts. .

U.S. producer prices rose slightly more than expected in November amid rising service costs, but the trend is moderating, with annual factory gate inflation posting its smallest increase in a year and a half, according to the data.

“Today’s data shows inflation is down, but it’s persisting and is stickier than most realize,” said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan. However, in December, consumer confidence improved, while inflation expectations hit a 15-month low, according to a University of Michigan survey.

Futures trading suggests a 77% chance of the Fed raising interest rates by 50 basis points next week, with a 23% chance of a 75 basis point hike, with those odds changing little after. Friday’s economic data.

Consumer price data for November, due on Tuesday, will provide further clues about the central bank’s monetary tightening plans.

Lululemon Athletica Inc. (LULU.O) fell nearly 13% after the Canadian sportswear maker forecast lower-than-expected revenue and profits for the holiday quarter.

Netflix Inc. (NFLX.O) gained 3.1% after Wells Fargo moved the video streaming giant from “overweight” to “equal weight”.

The S&P 500 fell 0.73% to end the session at 3,934.38 points.

The Nasdaq fell 0.70% to 11,004.62 points, while the Dow Jones Industrial Average fell 0.90% to 33,476.46 points.

Of the 11 S&P 500 sector indices, 10 fell, led by energy (.SPNY)down 2.33%, followed by a 1.28% loss in healthcare (.SPXHC).

The energy index posted a seventh straight session of losses, its longest losing streak since December 2018, as oil prices looked poised for weekly losses on recession fears.

Wall Street’s major indexes fell this week after posting two consecutive weekly gains. Fears of a potential recession next year are weighing heavily on investors due to the extension of central bank rate hikes.

For the week, the S&P 500 fell 3.4%, the Dow lost 2.8% and the Nasdaq lost 4%.

US stocks ended a recent streak of losses on Thursday after data showed initial jobless claims rose slightly last week.

Broadcom Inc. (AVGO.O) jumped 2.6% after the chipmaker forecast current-quarter revenue above Wall Street estimates.

Boeing Co climbed 0.3% after Reuters reported the planemaker was considering announcing a deal with United Airlines (UAL.O) for 787 Dreamliner orders next week.

Declining stocks outnumber rising stocks in the S&P 500 (.AD.SPX) by a ratio of 3.3 to one.

The S&P 500 posted 5 new highs and 1 new low; the Nasdaq recorded 54 new highs and 213 new lows.

Volume on U.S. exchanges was relatively light, with 9.9 billion shares traded, compared to an average of 10.9 billion shares over the previous 20 sessions.

Reporting by Sruthi Shankar, Ankika Biswas and Johann M Cherian in Bengaluru, and Noel Randewich in Oakland, California; Editing by Vinay Dwivedi, Sriraj Kalluvila, Shounak Dasgupta and Aurora Ellis

Our standards: The Thomson Reuters Trust Principles.

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