Stocks retreated from earlier highs as last week’s jobs report was initially seen as a sign that the economy could withstand aggressive rate hikes by the Fed to tame inflation running at four-decade highs. Investors now await Wednesday’s consumer price data to gauge whether the Fed could loosen up a bit in the fight against inflation and provide a better base for the economy to grow. read more Sign up now for FREE unlimited access to Reuters.com Register “The CPI data will help confirm whether the Fed’s tightening efforts have been successful in starting to reduce inflation or whether continued Fed tightening is needed,” said Robert Schein, chief investment officer at Blanke Schein Wealth Management. The Dow Jones Industrial Average (.DJI) added 29.07 points, or 0.09%, to 32,832.54, while the S&P 500 (.SPX) lost 5.13 points, or 0.12%, to 4,140. 06 and the Nasdaq 3.10 points (IX, IX)10 points (IX). or 0.1%, to 12,644.46. Volume on US exchanges was 11.01 billion shares. The S&P 500 has recovered 14% from mid-June lows. However, signs that inflation is getting much worse could strengthen the Fed’s case for aggressive monetary tightening. read more Anthony Saglimbene, chief market strategist at Ameriprise in Troy, Michigan, said the market was going to go down at some point as traders test the recent recovery. “Maybe we can go a little higher by the end of the year, but that’s if everything lines up perfectly,” he said, adding that the University of Michigan’s preliminary consumer sentiment survey for August on Friday will also be closely watched. “That’s the tug-of-war between these data sets that tell the story of, ‘Hey, are we going to turn into a recession or are we going to avoid it?’ U.S. interest rate futures are priced at a 67.5% chance of a 75 basis point hike at the Fed’s next meeting in September, up from about 41% before labor market data beat market expectations. FEDWATCH The information technology sector ( .SPLRCT ) fell 0.9 percent as chipmaker Nvidia Corp ( NVDA.O ) fell 6.3 percent after the company said it expected second-quarter revenue to fall 19 percent from the previous quarter to about $6.7 billion, due to gaming weakness. Philadelphia SE Semiconductor (.SOX) fell 1.6%, while value stocks (.IVX) rose 0.1%, outpacing a 0.4% drop in growth. Tesla ( TSLA.O ) rose 0.8 percent as the U.S. electric car maker signed contracts worth about $5 billion to buy battery materials from nickel refiners in Indonesia, according to a CNBC report. read more Shares in U.S. automakers rose after the U.S. Senate on Sunday approved a $430 billion climate change bill that created a $4,000 tax credit for used electric vehicles and provides billions in funding for their production. read more Rivian Automotive Inc (RIVN.O) rose 6.78%, Ford Motor Co gained 3.14%, General Motors Co (GM.N) added 4.16% and Lordstown Motors Corp (RIDE.O) rose 3.17%. Signify Health Inc rose 11.0% after a media report that CVS Health Corp wanted to buy the health technology company. Palantir Technologies Inc ( PLTR.N ) fell 14.2 percent after the data analytics software company cut its full-year revenue forecast as the timing of some major government contracts remained uncertain. read more Tyson Foods Inc (TSN.N) fell 8.4% after missing quarterly earnings expectations. read more Advancing issues outnumbered declining ones on the NYSE by a ratio of 2.28 to 1. On the Nasdaq, a ratio of 1.67 to 1 favored the advancers. The S&P 500 hit eight new 52-week highs and 29 new lows. the Nasdaq Composite recorded 104 new highs and 27 new lows. Sign up now for FREE unlimited access to Reuters.com Register Reporting by Bansari Mayur Kamdar and Aniruddha Ghosh in Bengaluru. Editing by Shounak Dasgupta and Cynthia Osterman Our Standards: The Thomson Reuters Trust Principles.
