Nasdaq, S&P 500, Dow Jones see volatile trading as Wall Street seeks direction

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Selling pressure is arriving late again Thursday as the stock market moves lower after some more choppy trading.

The Nasdaq (COMP.IND) is -1.7%, down 185 to 11,180, S&P (SP500) is -1.5%, down 58 to 3,877 and the Dow (DJI) -1.5%, down 460 points to 31,374.

Some names that have plunged lately, like Carvana and Peloton, continue to show notable strength. However, others, like Coinbase, have returned their earlier gains.

Two of 11 S&P sectors are higher, but this time it has moved to defensives. Healthcare and Real Estate are higher. Info Tech is now the biggest decliner.

Rates fell a little further after April’s PPI rose 0.5% as expected and the core rate rose 0.4%, lower than forecasts. The headline annual rise dropped to 11% but was above expectations.

The 10-year Treasury yield is off 7 basis points to 2.85%. The 2-year is down 5 basis points to 2.58%.

“A surprise 0.5% drop in the trade services component, which measures retail and wholesale margins, constrained the April core m/m,” Pantheon Macro said. “As a result, overall core services prices were unchanged. The decline in margins in April was broad, including healthcare, furniture retailing, auto dealers, and hotels. The trend in margins seems still to be rising, but the rate of increase has slowed from the peak last spring and summer, so the y/y rate is set to decline.”

The firm added: “This matters because the huge expansion in margins since Covid struck has been a key part of the surge in consumer inflation. A sustained decline in margins would change the overall inflation picture, but a decline in one month is not definitive.”

“Overall, markets appear to be oscillating between three sometimes competing concerns: inflation, recession and stagflation,” Goldman Sachs said.

Among stocks, Disney is down despite strong streaming additions and positive analyst commentary. Taesptry is the biggest S&P gainer after its results.