US stocks fell on Tuesday, with the Dow Jones Industrial Average declining for a ninth straight session, as cautious investors awaited the Federal Reserve's final policy announcement for the year amid stronger-than-expected economic data.
US retail sales rose more than anticipated in November, driven by increased motor vehicle purchases, reflecting the resilience of consumer spending despite elevated interest rates.
The Dow Jones Industrial Average fell 267.58 points, or 0.61%, to 43,449.90, marking its longest losing streak since 1978. The S&P 500 slipped 23.47 points, or 0.39%, to 6,050.61, while the Nasdaq Composite dropped 64.83 points, or 0.32%, to 20,109.06.
Investor attention remains on the Federal Reserve's policy decision on Wednesday, with a 25-basis-point interest rate cut largely priced in. Focus will also be on the Fed's summary of economic projections (SEP) and Chair Jerome Powell's comments, which could provide insights into the pace of rate cuts in 2025.
Jason Ware, Chief Investment Officer at Albion Financial Group, noted, "This is just standard pre-Fed caution. While a 25-basis-point cut is expected, there is uncertainty around Powell's remarks and the SEP."
Treasury yields fluctuated as markets braced for a potentially "hawkish cut" scenario, where the Fed maintains a cautious stance amid economic momentum and persistent inflation.
Sector Performance
Nearly all 11 major S&P sectors ended in the red, led by a 0.9% decline in industrials. Consumer discretionary stocks outperformed, buoyed by a 3.6% surge in Tesla following a price target increase from Mizuho to US$515.
Pfizer shares climbed 4.7% after the pharmaceutical giant issued a 2025 profit forecast in line with Wall Street expectations.
The small-cap Russell 2000 index, which is sensitive to higher interest rates, declined 1.2%, while the CBOE Volatility Index – Wall Street's "fear gauge" – rose to its highest level since late November.
Market Breadth and Volumes
Declining issues outnumbered advancing ones by a 2.77-to-1 ratio on the NYSE and 1.79-to-1 on the Nasdaq. The Nasdaq recorded 81 new highs and 197 new lows, while the S&P 500 posted 11 new highs and 19 new lows.
Volume on US exchanges was 16.17 billion shares, above the recent 20-day average of 14.11 billion shares.
Reuters
