US stocks retreat after inflation, retail sales data

By: News Desk      Published: 02:04 AM, 16 Jun, 2021
US stocks retreat after inflation, retail sales data

Wall Street stocks retreated from records Tuesday following data showing higher inflation and lackluster retail sales, while petroleum-linked shares rallied with oil prices.

The economic data pointed to a bumpy US recovery and came as the Federal Reserve began a two-day monetary policy meeting that will culminate with an announcement of its next steps Wednesday.

The Dow Jones Industrial Average finished down 0.3 percent at 34,299.33.

The broad-based S&P 500 lost 0.2 percent at 4,246.59, while the tech-rich Nasdaq Composite Index tumbled 0.7 percent to 14,072.86. Both the S&P 500 and Nasdaq finished at records Monday.

Producer prices for the past year spiked to 6.6 percent in May, the highest in the history of the data set dating back to 2010, the US Labor Department said.

Meanwhile, US retail sales fell by 1.3 percent in May, a bigger-than-expected drop, US data showed.

"Each month of high prices and sluggish labor market growth will test the Fed's patience," said a note from FHN Financial's Chris Low, adding that the Fed is likely on Tuesday to characterize the pricing jump as in line with expectations.

"It will be interesting to hear what the Fed has to say about consumer demand," Low said. "Most likely, Powell will council patience that some of the strength will moderate in the next few months."

While equities were broadly lower, oil-linked shares proved outperformers, with Chevron gaining 2.2 percent and Halliburton 2.5 percent. Crude prices rose to two-year peaks.

Categories : Business