Wall Street dips as materials stumble
American stocks were pulled lower on Wednesday by weakness in the materials and health-care sectors.
|||New York - Wall Street retreated on Wednesday, pulled lower by weakness in the materials and health-care sectors as investors continued to weigh the possibility of an interest rate hike in the coming months.
Healthcare shares, off 1.6 percent, saw their biggest drop since June 24. They were dragged lower by a 5.4-percent drop in Mylan to $43.15 as political pressure mounted on the company in the wake of price increases for its EpiPen allergy treatment.
Materials were down 1.2 percent as names such as Newmont Mining and Freeport-McMoRan were the worst performing names on the S&P 500, losing more than 7 percent. Gold fell to a one-month low on a firmer dollar.
The market is awaiting Federal Reserve Chair Janet Yellen's speech in Jackson Hole, Wyoming, on Friday for insight on the direction of monetary policy.
Recent hawkish comments from some Fed officials, including Vice-Chairman Stanley Fischer, have raised expectations that Yellen might signal a hike in September.
“The market over the past several weeks has been in a holding pattern, really not doing much of anything and the reason for that is everyone is waiting to hear what Yellen is going to say,” said Peter Cardillo, chief market economist at First Standard Financial in New York.
“Of course the markets might get surprised. The markets are looking for clarity and we might not get clarity.”
The benchmark S&P 500 has not seen a move of more than 1 percent in either direction on a closing basis since July 8.
Expectations for a rate hike in September are at 18 percent, up from 12 percent at the end of last week, according to CME Group's FedWatch. The odds of a hike in December are slightly more than 50 percent.
While Wall Street is trading near record levels, volumes have been below average in the past few sessions as the US earnings season winds down and traders avoid major bets until a clearer picture on monetary policy emerges.
The Dow Jones industrial average fell 65.82 points, or 0.35 percent, to 18,481.48, the S&P 500 lost 11.46 points, or 0.52 percent, to 2,175.44 and the Nasdaq Composite dropped 42.38 points, or 0.81 percent, to 5,217.70.
Express Inc plunged 25.5 percent after the apparel maker slashed its full-year earnings outlook.
Declining issues outnumbered advancing ones on the NYSE by a 2.39-to-1 ratio; on Nasdaq, a 1.96-to-1 ratio favoured decliners.
The S&P 500 posted 16 new 52-week highs and no new lows; the Nasdaq Composite recorded 100 new highs and 19 new lows.
About 6.09 billion shares changed hands in US exchanges, compared with the 6.26 billion daily average over the last 20 sessions.
REUTERS