Wall Street snaps run of record highs
The S&P 500 and Nasdaq snapped their eight-day streak of record closing highs Tuesday as investors got worried over inflation and cashed in their gains.
Prices at the wholesale level continued to gather steam, rising 8.6% in October from last year – far above the Federal Reserve’s 2% inflation target.
O’Neil Global Advisors Senior Portfolio Manager Randy Watts says that data boosted bond prices, which then spooked the stock market.
“I think that got people little nervous, but what's even more interesting is that bonds are actually rallying on this today, so the bond market is clearly saying that it is expecting slower growth in the future. I think that bond market action has investors unsettled a little bit, and so I think it's giving them excuse to take profits after what's been a very strong month.”
The Dow and S&P 500 shed more than three-tenth of a percent. The Nasdaq slid six-tenths of a percent.
General Electric was among the S&P’s top gainers, rising 2.6%. The venerable 129-year-old industrial conglomerate said it would split into three separate public companies to simplify its business.
Shares of Tesla extended their slide, plunging 12%. CEO Elon Musk’s Twitter poll Monday proposing to sell a tenth of his holdings raised questions as to whether he violated a settlement with securities regulators.
Robinhood Markets fell. The online trading app for small investors got hacked. The company said the security breach affected about 5 million of its customers.
