US stocks drifted a bit below their record heights Tuesday, a day ahead of what traders expect will be the Fed's first rate cut of the year.
- The S&P 500 fell 8.52 points, or 0.1%, to 6,606.76, coming off its latest all-time high.
- The Dow Jones Industrial Average fell 125.55 points, or 0.3%, to 45,757.90.
- The Nasdaq composite fell 14.79 points, or 0.1%, to 22,333.96.
Treasury yields eased a bit after a report showing stronger sales at US retailers did little to change expectations for the Fed to cut interest rates several times this year, starting Wednesday, and into 2026, the
AP reports. The report said shoppers increased their spending at US retailers by more last month than economists expected. A chunk of that could simply be due to shoppers having to pay higher prices for the same amount of stuff. But it could also indicate solid spending by US households could continue to keep the economy out of a recession.
Stocks have run to records on expectations that the Fed will announce the first of a series of cuts to rates on Wednesday afternoon in hopes of giving the economy a boost. Fed officials will also release their latest projections for where they see interest rates and the economy heading in upcoming years. The job market has slowed so much that traders believe Fed officials now see it as the bigger danger for the economy than the threat of higher inflation because of President Trump's tariffs. The Fed has been holding off on cuts to rates because inflation has remained above its 2% target, and easier interest rates could give it more fuel.
On Wall Street, Dave & Buster's fell 16.7% after the entertainment chain reported a weaker profit for the latest quarter than analysts expected. Ralph Lauren slipped 0.4% and got a tepid reception to the unveiling of its long-term financial plan, which it titled "Next Great Chapter: Drive." As part of it, the company said it expects compounded annual growth over the next three years to be in the mid-single digit percentages for revenue. New York Times Co. fell 1.6% after Trump filed a $15 billion defamation lawsuit against the newspaper and four of its journalists.
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On the winning end of Wall Street was Steel Dynamics, which climbed 6.1% after it said it's seeing improved earnings across its three business units. It credited strong demand for steel from the non-residential construction and auto industries, among other things. Oracle rose 1.5% on speculation that it could be part of a deal that would keep TikTok operating in the United States. Chipotle Mexican Grill added 1.9% after its board said the company could buy back an additional $500 million of its stock. Such a move can send cash directly to investors and boost per-share results.
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