Negative turn on the Wall, the indices lost their gains

The picture on Wall Street is deteriorating, with indices losing their profits that exceeded 1% in initial trading, as investors weigh the latest financial data and statements by Federal Reserve officials about the outlook for the US economy.

The data released today showed that consumer confidence sank to a 16-month low, while the rise in US house prices slowed for the first time since 2021. At the same time, New York Fed Chairman John Williams said today that he expects US economy to slow amid tightening Fed monetary policy in the coming months, but added that the US could avoid a recession.

“The recession is not my main scenario right now,” Williams said in an interview with CNBC. “I think the economy is strong,” he added.

However, he estimated that growth will slow down considerably, noting that “this will be a slowdown we want to see” in order to reduce inflationary pressures.

A major economic slowdown or recession in the coming months would pave the way for the US Federal Reserve to moderate its interest rate hikes. Most central bank officials, however, estimate that the economy will not enter a recession despite successive and aggressive interest rate hikes.

Indicators – Statistics

On the board, the Dow Jones is down 60.04 points or -0.19% at 31,378.22 points, while the S&P 500 is down 21.82 points or -0.61% at 3,877.10 points. The technology Nasdaq drops 149.88 points or -1.3% to 11,375.00 points.

Of the 30 stocks that make up the Dow Jones industrial average, 17 are moving with a positive sign and 13 with a negative. The biggest gainers were Walt Disney with gains of $ 2.13 or 2.20% at $ 98.74, followed by Dow with $ 53.06 with gains of 1.61% and UnitedHealth Group with gains of 1, 60% to $ 513.74

Nike is plunging 4.39% after the announcement of profits that exceeded analysts’ estimates, with the sportswear company, however, appearing cautious about its profit margins and course in China in the near future. Salesforce (-2.69%) and Home Depot (-2.51%) follow with the biggest losses.

At the end of the day, the consumer confidence index fell to a 16-month low in June as the price rally in energy, food and other items continues to weigh on consumer psychology.

In particular, according to research by the non-profit organization Conference Board, the index fell to 98.7 points in June from 103.2 points in May, losing the estimates of analysts who expected a softer drop to 100 points, according to a Wall Street poll. Journal.

In the individual data, the index for the current conditions in the economy fell to 147.1 from 147.4 last month, while the index for consumer expectations fell to 66.4 – the lowest level since March 2013 – from 73 , 7 in May.

“Expectations have now fallen below the level of 80, a sign of weak growth in the second half of 2022 as well as an increased risk of recession by the end of the year,” said Lynn Franco, senior director of economic indicators at the Conference Board.

At the same time, government data released today showed that the US trade deficit in goods shrank 2.2% in May to $ 104.3 billion, falling for the second consecutive month after the March record.

The trade deficit reached $ 106.7 billion in April and a record $ 125.6 billion in March.

Housing data released today showed that US house prices remained on an upward trajectory in April, with increases, however, slowing down to an initial sign that upward pressures may begin to decline.

In particular, prices rose 20.4% nationally in April compared to the same month a year earlier, according to the S&P CoreLogic Case-Shiller. In March, the price increase had reached 20.6%.

This is the first slowdown in prices since November last year.