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Wall Street drops after four-day rally as retailers, trade talks disappoint


By Sruthi Shankar

(Reuters) - U.S. stocks looked set to snap a four-day rally on Thursday as disappointing holiday-season results from Macy's hammered and no clear signs of a resolution emerged from U.S.-Chinese trade talks.

Despite the S&P 500's 0.60 percent retreat, the benchmark is holding near three-week highs and is 9.2 percent above the 20-month low it hit around Christmas, thanks to the recent rally that was driven by strong U.S. jobs data, easing fears of higher interest rates and rising hopes of a trade deal.

The trade optimism dampened after said the three days of talks had established a "foundation" to resolve differences, but gave virtually no details on key issues at stake such as forced technology transfers, intellectual property rights, tariff barriers and cyber attacks.

The mood was further hit a 19 percent slump in shares of after the retailer cut same-store sales forecast for the holiday quarter.

The report sparked a slide in retail stocks, with the S&P 500 retail dropping 1.94 percent. Combined with a 1.9 percent fall in Inc, the consumer discretionary slipped by 1.43 percent.

"Right now, the market is down given there is a lack of positive and the fact that nothing clear came out (of trade talks) doesn't necessarily help," said Andre Bakhos, at in Bernardsville,

"Investors are thinking if they want a risk-on ahead of earnings season."

Big tech stocks, which had led the recent surge, were down 0.76 percent. fell 1.3 percent, while dropped 1.4 percent.

At 10:07 a.m. EDT, the was down 106.15 points, or 0.44 percent, at 23,772.97, the S&P 500 was down 15.62 points, or 0.60 percent, at 2,569.34 and the Composite was down 59.18 points, or 0.85 percent, at 6,897.89.

Minutes from the Fed's most recent meeting, released on Wednesday, showed policymakers want to be patient about future interest rate increases. Investors will tune into Fed Jerome Powell's speech before the to see if the same tone continues.

reversed from an eight-day winning streak, driving the down 0.71 percent. Ten of the 11 S&P sectors were lower, with only posting slim gains.

fell 9.7 percent after the No.1 U.S. cut its forecast for fourth-quarter growth in unit revenue, a closely watched performance metric. That weighed on other airlines as well.

The fell 4.64 percent.

Among the few bright spots, Bed Bath & Beyond Inc, gained 5.9 percent after the home furnishing company reported a better-than-expected quarterly profit and gave upbeat earnings forecast.

Declining issues outnumbered advancers for a 2.47-to-1 ratio on the NYSE and for a 2.34-to-1 ratio on the

The S&P index recorded no new 52-week highs and one new low, while the recorded 8 new highs and 7 new lows.

(Reporting by in Bengaluru; Editing by and Saumyadeb Chakrabarty)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, January 10 2019. 22:05 IST