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Federal Reserve Chair Jerome Powell said on Tuesday recent
inflation data has not given policymakers enough confidence to
ease credit soon, noting that the U.S. central bank may need to
keep rates higher for longer than previously thought.
The Dow Jones Industrial Average got a boost from UnitedHealth
Group's better-than-expected quarterly results. Real estate and
utilities were the biggest drags on the S&P 500, while
technology gave the largest boost.
"People are trying to balance this two-sided narrative: U.S.
economic growth, which looks really good, and at the same time
the inflation picture and interest rates, which will eventually
be problematic for the equity market," said James St. Aubin,
chief investment officer at Sierra Mutual Funds in California.
A report on Monday showed retail sales grew more than expected
in March, a sign of U.S. economic resilience that helped push
benchmark U.S. 10-year Treasury yields to five-month highs on
Tuesday.
The Dow Jones Industrial Average rose 63.86 points, or 0.17%, to
37,798.97, the S&P 500 lost 10.41 points, or 0.21%, to 5,051.41
and the Nasdaq Composite lost 19.77 points, or 0.12%, to
15,865.25.
The S&P 500 and the Nasdaq are nearly 4% off from record high
levels reached last month.
Shares of Morgan Stanley rose 2.5% after its first-quarter
profit beat estimates on resurging income from investment
banking.
Bank of America dropped 3.5% after the lender posted lower
first-quarter profits as its loan loss provisions grew.
Johnson & Johnson slipped 2.1% as the drugmaker's revenue missed
analysts' estimates after sales from its blockbuster psoriasis
drug, Stelara, fell short of expectations.
Tesla slipped 2.7% a day after falling over 5% on news that the
EV marker plans to lay off more than 10% of its global
workforce.
Declining issues outnumbered advancers by a 2.25-to-1 ratio on
the NYSE, which had 23 new highs and 175 new lows. On the Nasdaq,
1,451 stocks rose and 2,764 fell as declining issues outnumbered
advancers by a 1.9-to-1 ratio.
The S&P 500 posted one new 52-week high and eight new lows while
the Nasdaq recorded 30 new highs and 362 new lows.
Volume on U.S. exchanges was 11.48 billion shares, compared with
the 11.05 billion average for the last 20 days.
(Reporting by Chibuike Oguh in New York; additional reporting by
Shashwat Chauhan and Shristi Achar A in Bengaluru; Editing by
Richard Chang)
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