The S&P 500 fell for a fifth day as traders weighed the possibility of a recession and the likelihood of a longer-than-expected bull cycle from the Federal Reserve.
The S&P slipped 0.19% to end the session at 3,933.92. The Dow Jones Industrial Average gained 1.58 points, roughly flat, to end the session at 33,597.92. The Nasdaq Composite fell 0.51% to end at 10,958.55.
Bond yields also fell, the rate 10-year cash flow note at one point touching a low of 3.402%.
Stocks swung between gains and losses in choppy trading, with the S&P rising as much as 0.41%. At its lows, the benchmark fell 0.47%.
“The market is kind of floating and weaving and getting its breath back from the big rally from the October lows,” said Ryan Detrick, chief market strategist at Carson Group. He expects markets to continue this trend until investors receive more clarity from the Fed’s monetary policy meeting in December and November’s consumer price index report.
Next week, the central bank is expected to hike rates by 50 basis points. While the move would be smaller compared to the previous four rate hikes, concerns are swirling over whether the Fed can stage a so-called soft landing while still successfully taming inflation.
Worries about a recession in 2023 have spooked some investors in recent days.
“All in all, financial indicators point to a recession on the horizon,” Wells Fargo’s Azhar Iqbal wrote in a note to clients on Wednesday. “The S&P 500 has peaked before recessions with an average lag of four months in recent business cycles.
Investors are awaiting more economic data this week to know what to expect from the Fed, with jobless claims data due out on Thursday. November’s producer price index and preliminary consumer sentiment data for December are due out on Friday.
Stocks are poised for weekly losses, with the Dow down 2.42%. The S&P and Nasdaq are down 3.38% and 4.39%, respectively.
Comments are closed.