Today's Edition
NEW YORK (REUTERS)
Major stock indexes declined on Tuesday, with chip stocks lower as chief executives at Goldman Sachs and Morgan Stanley cautioned that equities could be heading for a pullback, while the dollar climbed to a four-month high against the euro.
US Treasury yields dipped on risk-off sentiment, which also helped to support the dollar.
Meanwhile, bank CEOs warned at an investment summit in China of the prospect of a stock market correction of more than 10% over the next two years.
Shares of Nvidia were down more than 2% early, while an index of semiconductors also was down about 2%.
Shares of Palantir Technologies were down more than 7% despite the company reporting strong quarterly results. The company, which has more than doubled in value this year, forecast fourth-quarter results above market expectations, driven by a rapid AI adoption boosting demand for its data analytics services.
"Big Short" investor Michael Burry, known for his successful bets against the US housing market in 2008, has now placed bearish bets on Nvidia and Palantir, according to a regulatory filing on Monday.
The Nasdaq was down more than 1%, leading declines among the three major US stock indexes. The Nasdaq is still up nearly 22% for the year so far.
The Dow Jones Industrial Average fell 190.95 points, or 0.40%, to 47,147.49, the S&P 500 fell 54.48 points, or 0.80%, to 6,797.49 and the Nasdaq Composite fell 316.86 points, or 1.33%, to 23,517.86. MSCI's gauge of stocks across the globe fell 8.53 points, or 0.84%, to 999.38.
The pan-European STOXX 600 index fell 0.42%.
Earlier, Asian shares tumbled from all-time highs. Stocks gained Monday following Amazon's $38 billion cloud services deal with ChatGPT creator OpenAI.
The US dollar was underpinned in part by reduced bets for near-term Federal Reserve easing, with divisions within the Fed raising doubt about the prospect of another rate cut this year. The Fed lowered rates last week but Chair Jerome Powell said a December rate cut was not a foregone conclusion.
Traders now price a 65% chance of a rate cut in December, compared with 94% a week earlier, CME FedWatch showed.
The euro fell for the fifth straight session and was down 0.3% at $1.148, its weakest since August 1. Against the yen, the dollar was 0.5% lower, though the Japanese currency remained near a recent 8-1/2-month low.
Sterling tumbled after the UK finance minister pointed to "hard choices" in her upcoming budget. Sterling weakened 0.72% to $1.3044.
Cryptocurrency bitcoin was down 2% to $107,486, its weakest since June.
US Treasury yields declined amid a broader risk-off tone in financial markets. Because of the government shutdown, a closely watched monthly jobs report from the Bureau of Labour Statistics will not be available on Friday, as previously scheduled.
The yield on benchmark US 10-year notes fell 2.6 basis points to 4.081%, from 4.107% late on Monday.
US crude fell 0.64% to $60.66 a barrel and Brent fell to $64.50 per barrel, down 0.6% on the day. Spot gold fell 0.67% to $3,975.00 an ounce.
