US stocks largely unchanged; retail sales show weak growth
US stocks largely unchanged; retail sales show weak growth
Investing.com -- U.S. stocks traded in a steady fashion, after the release of soft retail sales data raised concerns about the strength of the U.S. economy, but also boosted the chances of interest rate cuts this year.
By 09:35 ET (13:35 GMT), the Dow Jones Industrial Average was largely unchanged, S&P 500 traded 7 points, or 0.1%, higher and NASDAQ Composite traded flat.
Retail sales show weakness
U.S. retail sales increased at a slower-than-anticipated rate on a monthly basis in May, rising 0.1%, an improvement from a downwardly-revised decline of 0.2% in April.
Economists had predicted that retail sales, which mostly reflect goods and are not adjusted for inflation, would grow by 0.3%.
The weak retail sales figure could impact the outlook for the wider economy, which may in turn influence how the Federal Reserve approaches potential interest rate reductions later this year.
Investors will also focus on the speeches of Fed officials this week, including Boston Fed President Susan Collins and Richmond Fed President Tom Barkin later in the session.
On Monday, Philadelphia Fed President Patrick Harker backed one 25-basis point cut in 2024, echoing a median rate forecast for the rest of the year that was released by policymakers last week.
Tesla battles for CEO Musk’s pay package
In the corporate sector, Tesla (NASDAQ:TSLA) stock fell 0.7% as the electric car manufacturer has initiated its battle for legal recognition of Chief Executive Elon Musk's massive $56 billion pay package after shareholders voted in favor of the compensation agreement, after a judge had previously voided the pay earlier this year.
Elsewhere, Chegg (NYSE:CHGG) stock soared 15% after the education technology group announced plans to slash 23% of its global workforce as part of a broader restructuring push.
Lennar (NYSE:LEN) stock dropped over 3% after the homebuilder forecast its third-quarter home deliveries below expectations, a sign that demand for new homes is expected to remain sluggish as mortgage rates hover at a two-decade high.
GameStop (NYSE:GME) stock fell 3%, continuing the previous session’s sharp losses, after CEO Ryan Cohen told investors that the video game retailer plans to operate a smaller network of stores.
Crude edged higher after US retail sales
Crude prices edged higher Tuesday, continuing recent gains after the weak U.S. retail sales offered hope of lower interest rates later this year.
By 09:35 ET, the U.S. crude futures (WTI) traded 0.2% higher at $79.91 per barrel, while the Brent contract climbed 0.3% to $84.47 per barrel.
Both benchmarks gained around 2% on Monday, closing at their highest since April.