Wall Street stocks inched down at Tuesday’s open as traders returning from a long weekend grappled with fresh data showing China’s economy is still struggling to recover.
The S&P 500 (^GSPC) fell 0.1%, while the Dow Jones Industrial Average (^DJI) was broadly unchanged, both paring earlier deeper losses. The tech-heavy Nasdaq Composite (^IXIC) slid 0.4%, as climbing 10-year Treasury yields weighed on growth stocks.
Shares in Nvidia (NVDA) and Apple (AAPL) as markets reopened after the Labor Day holiday.
The three major gauges are coming off a winning week that saw the S&P 500 book its best weekly performance since June, as a stream of economic updates fed hopes the Federal Reserve would hold off from hiking interest rates at its September meeting.
Data out Tuesday showed China’s services activity fell to its lowest level in eight months in August, reviving worries about recovery in the world’s second-biggest economy — and what that means for demand globally.
Amid the downturn debate, analysts at Goldman Sachs cut their odds of a US recession, given cooling inflation and a still-resilient labor market. Plus, they played down the idea that a long drag from the Fed’s rate-hiking campaign will push the economy into a severe slowdown.
With a light earnings and economic calendar ahead, the focus will likely stay on the Fed this week, when investors looking at seasonal forces in play for stocks may well find fewer reasons to be cheerful. September has historically been a downbeat month for markets.
That said, some analysts believe September may not be as bad as expected, pointing to factors such as excitement around AI, cash on the sidelines, and Apple’s rumored new iPhone release.
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