FYI: Major U.S. stock indexes fell Tuesday and investors resumed their buying of less risky assets, putting the market’s recent recovery temporarily on hold.
Stocks, from banks to material firms to consumer staples, broadly fell, as investors remained edge over the U.S. and China’s trade conflict and how the Federal Reserve plans to proceed with monetary policy. The losses pressured the Dow Jones Industrial Average and the S&P 500 throughout the session, putting both indexes on track to post their first declines in four trading sessions.
No major catalysts precipitated Tuesday’s pullback, and some analysts described the trading session as a “pause” while investors awaited further meaningful developments on trade and the interest rates. At the same time, investors bought less risky assets, including bonds—pushing yields even lower—and other havens, such as gold.
The blue-chip index dropped 172 points, or 0.66%, to 25962, while the S&P 500 fell 0.79%. The Nasdaq Composite also declined, sliding 0.68%.
Small gains among shares of consumer discretionary stocks helped major indexes avoid even deeper losses. The sector got a boost after Home Depot reported solid earnings for its most recent quarter.
Tuesday’s selloff wasn’t unusual, some investors said, considering the Dow and S&P 500 rose 2.6% and 2.9%, respectively over the previous three trading sessions. That recovery put both indexes back within 5% of their July records. Still, investors said the next catalysts for stocks are likely to be signs the U.S. is truly on a path toward resolving trade tensions and that the economy is holding up.
Most S&P 500 sectors declined Tuesday.
Material stocks, which are sensitive to trade and global economic concerns, fell 1%, extending their rout this month to more than 3%.
Energy stocks also stumbled alongside a slide in oil prices, while financial stocks were hit by the latest slide in bond yields, which usually make it harder for banks to make money on loans.
The yield on the 10-year U.S. Treasury note fell to 1.550% on Tuesday, according to Tradeweb, from 1.603% a day earlier.
Gold prices, meanwhile, rose 0.3%.
Despite the fatigue in other corners of the market, shares of consumer discretionary stocks maintained their gains throughout most of the session. They were led higher by Home Depot shares, which added 4.4% after the home-improvement chain reported earnings that topped expectations, even as it cut its sales forecast and warned the potential effects of tariffs could weigh on growth. Shares of other retailers, including rival Lowe’s, followed Home Depot higher.
Investors say the expect the volatility to continue, with several predicting a see-sawing market over the next several weeks that leaves major indexes stuck in a trading range. In the meantime, many say they will pay close attention to the minutes from the Fed’s latest meeting Wednesday, as well as any statements from Chairman Jerome Powell ahead of the economic symposium in Jackson Hole, Wyo., starting Friday.
Regards,
Ted
Bloomberg Evening Briefing:
https://www.bloomberg.com/news/articles/2019-08-20/your-evening-briefingMarketWatch:
https://www.marketwatch.com/story/us-stock-futures-edge-lower-threaten-to-snap-dows-three-day-win-streak-2019-08-20/printWSJ:
https://www.wsj.com/articles/global-stocks-waver-amid-uncertainty-on-rates-trade-talks-11566289132Bloomberg:
https://www.bloomberg.com/news/articles/2019-08-19/asian-stocks-to-gain-dollar-rises-to-2019-high-markets-wrap?srnd=premiumIBD:
https://www.investors.com/market-trend/stock-market-today/dow-jones-closes-session-low-3-dow-stocks-avoid-loss/CNBC:
https://www.cnbc.com/2019/08/20/dow-federal-reserve-minutes-in-focus.htmlReuters:
https://uk.reuters.com/article/us-usa-stocks/wall-street-treads-water-after-three-day-winning-streak-as-financials-weigh-idUKKCN1VA13CU.K:
https://uk.reuters.com/article/uk-britain-stocks/worries-over-global-trade-italy-lead-ftse-100-lower-idUKKCN1VA0L0Europe:
https://uk.reuters.com/article/uk-europe-stocks/european-shares-gain-for-third-straight-session-astrazeneca-boosts-idUKKCN1VA0KNAsia:
https://www.cnbc.com/2019/08/20/asia-markets-august-20-rba-pboc-new-loan-prime-rates-currencies.htmlBonds:
https://www.cnbc.com/2019/08/20/us-bonds-treasury-yields-tick-lower-as-investors-await-economic-data.htmlCurrencies:
https://www.cnbc.com/2019/08/20/forex-markets-us-dollar-global-economy-in-focus.htmlOil:
https://www.cnbc.com/2019/08/20/oil-markets-us-china-trade-in-focus.htmlGold:
https://www.cnbc.com/2019/08/20/gold-markets-global-economy-in-focus.htmlWSJ: Markets At A Glance:
https://markets.wsj.com/usMajor ETFs % Change:
https://www.barchart.com/etfs-funds/etf-monitorSPDR's Sector Tracker:
http://www.sectorspdr.com/sectorspdr/tools/sector-trackerSPDR's Bloomberg Sector Performance Pie Chart:
https://www.bloomberg.com/markets/sectorsCurrent Futures:
https://finviz.com/futures.ashx 
