Wall Street fall on rate hike uncertainty; Show weights Dow

People are seen on Wall Street outside the New York Stock Exchange (NYSE) in New York City, USA, March 19, 2021. REUTERS / Brendan McDermid / File Photo

  • Prospects for upside targets, but the share falls in the third quarter margin
  • Shares from electric car manufacturers are rising due to increasing demand
  • Visa waiver after Amazon denies high fees in UK
  • Indices: Dow down 0.47%, S&P down 0.11%, Nasdaq flat

November 17 (Reuters) – Wall Street indices fell on Wednesday as investors worried about early Federal Reserve rate hikes after strong retail earnings, while Visa weighed on the Dow after Amazon said it would stop accepting cards issued by the UK operator.

Target Corp (TGT.N) was the last major retailer to report positive results, as it raised its annual forecasts and beat earnings expectations, citing an early start in the holiday trade.

But the company’s shares fell 5.2%, following a decline in Walmart (WMT.N) shares on Tuesday, when both dealers reported a hit on their third-quarter margins from supply chain problems. read more

Lowe’s Cos Inc (LOW.N) rose 0.8% after the housing improvement chain raised its sales forecast for the full year due to higher demand from builders and contractors, as well as a strong US housing market. Peer Home Depot (HD.N) had also reported strong results on Tuesday. read more

Visa Inc (VN) fell 5.4% and was the biggest burden on Dow after Inc (AMZN.O) said it would stop accepting credit cards issued by the company in the UK from next year due to the high fees charged for transactions. read more

Losses in the Nasdaq (.IXIC) were offset by large technology stocks, which tend to increase in times of high market uncertainty.

While strong retail data this week showed that a rise in inflation has not stifled economic growth so far, investors feared that further price increases could hurt growth and pressure the Federal Reserve to tighten policy ahead of schedule.

“The fear of inflation is still there, and they continue to sneak in and discussions that we have – is it transient, is it supply-driven – is it still in the market,” said Joe Saluzzi, Co-Manager of Trading at Themis Trading in Chatham, New Jersey.

“The Fed will hold on for as long as they can … But if (inflation) continues to rise and you continue to see inflationary pressures, then it will be a question of how many and how often (interest rates) will rise.”

Contrasting comments from Fed Presidents James Bullard and Mary Daly on Tuesday also created more uncertainty in the markets.

Strong retail revenues this week will round off a positive third-quarter earnings season, which had pushed Wall Street indices to record highs.

Investors were waiting for third quarter results from Nvidia Corp (NVDA.O), which was due to arrive after the bell. The shares of the chip manufacturer fell 0.7%, but traded just below record highs.

The Philadelphia Semiconductor Index (.SOX) also hovered below all-time highs.

At 11:52 ET, the Dow Jones Industrial Average (.DJI) was down 169.37 points, or 0.47%, to 35,972.85 and the S&P 500 (.SPX) was down 5.24 points, or 0.11% , to 4,693.45. The Nasdaq Composite (.IXIC) was largely unchanged at 15,974.11.

Tesla rose 3.8%, while its peer Canoo (GOEV.O) rose 7.0% amid growing demand for EV shares on Wall Street. read more

But Rivian Automotive Inc (RIVN.O) fell 16.4%, as investors unlocked gains from a winning streak of almost 71% since the stock’s listing last week.

Falling issues were more than progress for a 2.41-to-1 ratio on the NYSE and for a 2.29-to-1 ratio on the Nasdaq.

The S&P index recorded 30 new 52-week highs and five new lows, while the Nasdaq recorded 78 new highs and 169 new lows.

Reporting by Ambar Warrick and Devik Jain in Bengaluru; Edited by Maju Samuel

Our standards: Thomson Reuters Trust Principles.

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