Stock Market Today: Indexes Slip After Best Day Since November

The stock market today experienced a pullback after a strong rally yesterday, which was the best day for stocks since November. The S&P 500, Dow Jones Industrial Average, and Nasdaq Composite all slipped, giving up some of their recent gains. The market's volatility continues to be driven by a mix of economic data, geopolitical events, and investor sentiment.



The S&P 500 dropped 0.2% to 5,853.98, coming off a sixth straight winning week, its longest such streak of the year. The Dow Jones Industrial Average fell 0.8% from its own record that was likewise set on Friday, to 42,931.60. The Nasdaq composite rose 0.3% to 18,540.00.

The declines mean at least a pause in Wall Street's rally to records, which was built in large part on optimism that the U.S. economy can make a perfect escape from the worst inflation in generations, one that ends without a painful recession that many investors had worried could be inevitable.



With the Federal Reserve now cutting interest rates to keep the economy humming, optimists hope stocks can rise even further. But critics are warning stock prices look too expensive given they’ve climbed much faster than corporate profits. That puts pressure on companies to deliver growth in profits to justify their stock prices, and more than 100 companies in the S&P 500 are scheduled to give details this week about their performances during the summer. That includes such heavyweights as AT&T, Coca-Cola, IBM, General Motors and Tesla.

Tesla slipped 0.8% ahead of its report. Its stock has been shaky recently, including a tumble after an update on its highly anticipated robotaxi included fewer details than investors were hoping for.

Boeing is reporting its latest results on Wednesday. It rose 3.1% after reaching an agreement with the union representing its striking machinists on a contract proposal. The union’s members could vote Wednesday on the deal, which could end a costly walkout that has crippled production of airplanes for more than a month.

Trump Media & Technology Group rose 5.8% to top $31, continuing its strong run since it briefly dipped below $12 last month. The company behind former President Donald Trump’s Truth Social platform is still losing money, but its stock often moves more with his perceived chances of reelection than anything else.

The Bank of Canada will also announce its latest decision on interest rates Wednesday, where it could cut by half a percentage point.

In energy trading, benchmark U.S. crude lost 21 cents to $70.35 a barrel. Brent crude, the international standard, fell 36 cents to $73.93 a barrel.

In currency trading, the U.S. dollar rose to 150.79 Japanese yen from 150.69 yen. The euro inched up to $1.0822 from $1.0819.

Investors appear to be pretty comfortable with Wednesday's inflation reading. But how long that will last? Seema Shah, chief global strategist at Principal Asset Management, pointed out in commentary shared with MarketWatch that markets are likely to be "whipsawed" by incoming economic data as the official numbers continue to send mixed messages about the pace of inflation and growth.

"Perhaps the key takeaway is that markets are likely to be whipsawed over the next few data releases as investors seek a narrative that they can be comfortable with for more than just a few days at a time," she said.

The image investors have about inflation and the economy has fluctuated pretty wildly over the past six months or so. Late last summer, U.S. stocks were rocked as investors digested signs that the labor market was rapidly weakening. That ultimately inspired the Fed to kick off its rate-cutting cycle with a 50-basis-point reduction of its policy interest-rate target in September.

A few months later, data showed the U.S. labor market was surprisingly strong in December.