US stocks fell sharply, weighed down by sharp losses in healthcare stocks and continued rise in Treasury yieldswhile comments from several Federal Reserve officials reiterated the need to keep rates high for longer.
Treasury yields continued to add to the previous day’s gains, The recent spate of stronger economic data and Fed speakers’ cooling expectations for early rate expectations muddied the way. towards faster rate cuts.
San Francisco Federal Reserve President May Daly echoed what was said earlier Tuesday by Cleveland Fed President Loretta Mester, who said “which sees the Fed cutting rates this year”but noted that the biggest risk was resorting to cuts too soon rather than keeping them high for longer, until the 2% inflation objective required by the Central Bank is achieved.
The comments came immediately after data was released showing that Job openings increased to 8,756 million in February, from 8,748 million in Januaryalthough just below expectations of 8.76 billion.
Employment news will continue to be the focus of attentionand the March payrolls report is scheduled to be released on Friday.
It is expected that The US economy added 205,000 jobs in Marcha slowdown from the 275,000 jobs added in February, amid hopes that the economy is ready for a “soft landing,” in which inflation moderates but the economy avoids a severe slowdown.
Health care stocks, including Humana Inc., UnitedHealth Group Incorporated, and CVS Health Corp, fell sharplye to lead losses in the broader market after the Center for Medicare Services and private Medicaid Medicare Advantage will increase rates an average of 3.7% starting in 2024.
The rate was unchanged from initial proposals in January, indicating that insurers’ margins will remain under pressure next year. That took Wall Street by surprise, since only once in the last 10 years, final rates did not increase compared to initial proposalsaccording to JPMorgan.
While Tesla shares fell 5% after the electric vehicle maker reported its first-quarter delivery numbers, well below expectations.
The electric vehicle giant delivered 386,810 vehicles compared to the estimated 449,080.
This mistake was an “absolute disaster,” according to analysts who said, that it marked “a pivotal moment in Tesla’s history for Musk to change this…otherwise, there could clearly be some darker days ahead that could disrupt the long-term.” “.
Your competitor’s actions Rivian Automotive also fell 5% after the electric vehicle company fell behind analyst consensus on first-quarter production numbers.
Other EV Stocks Including Nio Inc Class A ADR and Nikola Corpalso recorded red numbers.
Schlumberger N.V. said it reached an agreement to acquire the equipment manufacturer for Champion X oilfield for $7.7 billion in a stock deal, causing the latter’s shares to gain more than 8%.
Besides, PVH shares plummeted more than 22% after the fashion retailer, owner of the Tommy Hilfiger and Calvin Klein brands, provided disappointing full-year sales forecasts, citing a difficult macroeconomic backdrop, especially in Europe.
In a round of red numbers since the opening, which at the end changed a little but remained negative, the index Dow Jones of Industriales closed at 39170.76 points, falling 1%, the S&P500 stood at 5205.81 points, losing 0.7% and Nasdaq Composite depreciating 1% it reached 16240.45 points.
Source: Ambito
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