US stocks moved lower during midday trading on Tuesday after President Joe Biden and House Republican Speaker Kevin McCarthy’s debt-ceiling talks the previous day ended with both taking an optimistic tone, but without a deal.
The S&P 500 (^GSPC) fell 0.29%. The Dow Jones Industrial Average (^DJI) was flat. The technology-heavy Nasdaq Composite (^IXIC) declined 0.28% at 12:09pm ET.
In Treasuries, yields moved higher across the curve Tuesday, with the benchmark 10-year yield rising to 3.76%. Two-year yields climbed to 4.38%, and those on the 30-year bond rose to 3.98%. The gains came as worries over the debt-ceiling standoff intensified, as the prospect of a default moves closer.
President Joe Biden and House Speaker Kevin McCarthy said Monday’s meeting was a “productive discussion” but the two sides still remained short of a deal.
McCarthy said he anticipates talking with Biden every day "until we get this done." But he warned that "there's nothing agreed to, everything's being talked about.”
This has left investors on edge in the countdown to the June 1 "X-date", which is when Treasury Secretary Janet Yellen said a default is likely to come.
“Our base case remains that the debt ceiling ultimately does get lifted/suspended though the journey to that end could be at the eleventh hour and drive significantly higher market instability than appreciated by the market currently,” Dubravko Lakos, chief US equity strategist at JPMorgan, wrote in a note Monday.
“We expect a temporary/comprehensive deal on the debt ceiling to negatively impact federal spending and for a likely contentious budget negotiation process later this year,” Lakos added.
On the economic front, S&P Global's flash US composite PMI, which captures activity in both the services and manufacturing sectors, came in at 54.5 in May, up from 53.4 in April and better than the 53.0 estimated by economists, marking a 13-month gain for the index.
Separately, new single-family home sales rose 4.1% in April to an annualized pace of 683,000 up from consensus rate of 669,000, according to a report from the Census Bureau.
In single stock moves, shares of Yelp Inc. (YELP) rallied over 7% as activist investor TCS Capital Management confirmed its stake in the company and asked the company to explore strategic alternatives including a sale, according to an open letter to the Yelp board of directors on Tuesday.
Lowe's Companies, Inc. (LOW) shares gained more 2% after the home-improvement company cut its full-year sales forecast Tuesday, citing lower demand as high inflation impacts discretionary spending.
Shares of Dick's Sporting Goods (DKS) edged up after the company topped its first fiscal quarter sales and earnings, while maintaining its outlook for this year
Zoom Video Communications, Inc. (ZM) shares dropped more than 7% after the videoconferencing software company posted a beat on their results for its fiscal first quarter. The company also raised its full-year guidance.
Shares of Pfizer Inc. (PFE) rose after a study showed positive weight-loss results for patients taking the drug maker’s oral diabetes treatment.
BJ's Wholesale Club Holdings, Inc. (BJ) shares declined more than 6% after the retailer reported revenue that came in below analysts expectations. Comparable club sales not including gasoline were lower than anticipated.
After the closing bell, Palo Alto Networks, Inc. (PANW), Intuit Inc. (INTU) and Toll Brothers, Inc. (TOL) are expected to report results.
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Dani Romero is a reporter for Yahoo Finance. Follow her on Twitter @daniromerotv
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https://news.google.com/rss/articles/CBMiaGh0dHBzOi8vY2EuZmluYW5jZS55YWhvby5jb20vc3RvY2tzLXNsaXAtYXMtZGVidC1jcnVuY2gtY29udGludWVzLXN0b2NrLW1hcmtldC1uZXdzLXRvZGF5LTExNTIyNTkwNi5odG1s0gFwaHR0cHM6Ly9jYS5maW5hbmNlLnlhaG9vLmNvbS9hbXBodG1sL3N0b2Nrcy1zbGlwLWFzLWRlYnQtY3J1bmNoLWNvbnRpbnVlcy1zdG9jay1tYXJrZXQtbmV3cy10b2RheS0xMTUyMjU5MDYuaHRtbA?oc=5
2023-05-23 16:09:57Z
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