U.S. stocks closed down on Tuesday after a batch of upbeat economic data raised concerns that an inflation rebound could slow down the Federal Reserve's pace of monetary policy easing.
Stocks gave up early gains after a Labor Department report showed job openings unexpectedly increased in November, while a separate report said services sector activity accelerated in December with a measure tracking input prices surging to a near two-year high.
Benchmark 10-year Treasury yields hit an eight-month high at 4.677% after the data pointed to a strong economy.
Signs of continued resilience in the economy have pushed back expectations on when the central bank can deliver its first interest rate reduction this year. Traders now see the next cut more likely in June and the Fed staying on hold for the rest of 2025, according to the CME Group's FedWatch tool.
According to preliminary data, the S&P 500 (.SPX), lost 66.20 points, or 1.11%, to end at 5,909.54 points, while the Nasdaq Composite (.IXIC), lost 375.77 points, or 1.89%, to 19,489.21. The Dow Jones Industrial Average (.DJI), fell 179.06 points, or 0.42%, to 42,527.50.
Higher yields pushed technology stocks (.SPLRCT), lower. Shares of AI bellwether Nvidia (NVDA.O), fell sharply.
Most of the 11 S&P 500 sectors declined.
The main focus of the week is the key non-farm payrolls data, along with minutes from the Fed's December meeting.
In the previous session, the S&P 500 (.SPX), and the Nasdaq (.IXIC), closed short of one-week highs on uncertainty after President-elect Donald Trump denied a report that his team was exploring less aggressive tariff policies.
Source : Reuters
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