©Reuters. FILE PHOTO: A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., June 22, 2022. REUTERS/Brendan McDermid
By Shreyashi Sanyal and Amruta Khandekar
(Reuters) – Wall Street’s main indices fell after opening higher on Monday as a rally last week to ease inflation concerns lost momentum, with high-growth stocks leading declines.
“We had a nice rally last week, so we’re seeing a bit of profit-taking this morning,” said Dennis Dick, a proprietary trader at Bright Trading LLC in Las Vegas.
“The stocks that rose the most last week will be hit the hardest here today.”
The tech-heavy index, which rose 7.5% last week, fell 0.7% to lead declines among the big three indices.
Investors have been betting on the fall in oil prices from the three-month highs reached in June, potentially easing inflationary pressures and likely persuading the Federal Reserve to ease its aggressive monetary tightening.
However, data on Monday showed that new orders for US-made capital goods and shipments rose solidly in May, suggesting continued strength in corporate spending on equipment in the second quarter.
Oil prices also moved back into positive territory, sending the S&P 500 energy index up 2.2%, dampening expectations for a fall in inflation due to lower energy prices. [O/R]
The US Federal Reserve has been quick to raise interest rates to tame 40 years of high inflation, stoking fears its actions could plunge the world’s largest economy into recession.
After the benchmark fell 20% from its closing high in January earlier this month to confirm a bear market, investors have been trying to gauge when the market might bottom.
As of 10:11 a.m. ET, the S&P 500 was down 76.62 points, or 0.24%, to 31,424.06, the S&P 500 was down 13.94 points, or 0.36%, to 3,897.80, and the Nasdaq Composite was down 78 .44 points or 0.68% to 11,529.19.
Robinhood (NASDAQ:) Markets shares rose 0.6% after media reports suggested Goldman Sachs (NYSE:) upgraded the retail broker’s stock to neutral from a sell.
However, Goldman Sachs downgraded Coinbase (NASDAQ:) Global Inc’s rating from “buy” to “sell,” according to media reports, sending shares of the cryptocurrency exchange down 9.4%.
At a 1.03 to 1 ratio on the NYSE and a 1.31 to 1 ratio on the Nasdaq, bearish issues outweighed the leaders. The S&P index posted a new 52-week high and 29 new lows, while the Nasdaq posted 16 new highs and 41 new lows.