Wall Street‘s main indexes fell to touch a more than one-month low on Tuesday after fresh economic data indicated consumer mood was deteriorating and investors braced for a possible fallout from tighter U.S. trade controls on Beijing.
The Conference Board said consumer confidence deteriorated in February at its fastest pace in three-and-a-half years, with estimates for 12-month domestic inflation surging amid worries that U.S. tariffs on imports would raise prices for households.
Investors flocked to Treasury bonds, sending the yield on the two-year note to its lowest since November, helping real estate stocks rise 1.4%.
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Sectors which are expected to fare better despite economic uncertainty gained, with consumer staples rising 1.9% and healthcare adding 0.3%.
“There has been a lot of talk about tariffs, but until we really know what (the) policy will end up being, the uncertainty is making it difficult for the bulls to really get any kind of control of this market,” said Chris Zaccarelli, chief investment officer at Northlight Asset Management.
Tuesday’s consumer confidence report reinforced worries that the domestic economy is stalling and the U.S. Federal Reserve is likely to be cautious about cutting interest rates.
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U.S. Treasury Secretary Scott Bessent said the economy is more fragile under the surface than economic metrics suggest.
Interest-rate futures currently point to the central bank staying put on borrowing costs for the first half of the year, according to data compiled by LSEG.
Policymaker Thomas Barkin and Fed Vice Chair for Supervision Michael Barr are expected to speak through the day.
At 11:50 a.m. the Dow Jones Industrial Average fell 5.45 points, or 0.01%, to 43,455.76, the S&P 500 lost 47.97 points, or 0.80%, to 5,935.28, and the Nasdaq Composite lost 304.07 points, or 1.58%, to 18,983.51.
A gauge tracking investor fear spiked to hit its highest in nearly a month and was last up 1.57 points at 20.51.
Seven of the S&P 500’s 11 sectors traded lower, with communication services leading declines with a 1.8% drop.
Investors also focused on a report that said the U.S.
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