Dow falls for the third straight day as investors await inflation data, bank earnings

Dow falls for the third straight day as investors await inflation data, bank earnings

U.S. stocks fell back from record levels Tuesday, breaking an eight-day winning streak for the S&P 500.

The benchmark index declined 16.45 points, or 0.3%, to 4685.25, its third-highest closing level in history. On Monday, it notched its eighth consecutive winning session and eighth straight all-time closing high, the longest streak of records since 1997.

The Dow Jones Industrial Average ticked down 112.24 points, or 0.3%, to 36319.98, a day after the blue-chip index notched its 44th record of 2021. The technology-focused Nasdaq Composite fell 95.81 points, or 0.6%, to 15886.54.

Some investors view Tuesday’s pullback as a breather after the rally. Propelled by strong third-quarter earnings, stocks have continued to trend upward against the backdrop of supply-chain issues and concerns about inflation.

The averages traded near the flatline for much of Tuesday’s session before selling picked up into the close.

Markets were “mostly in wait-and-see mode” ahead of report releases this week, Bank of America said.

Investors

“Headlines are fairly quiet today as the market awaits several upcoming catalysts like September CPI and retail sales, the latest FOMC minutes, and the start of the Q3 earnings season,” Stifel analysts said in a note.

The consumer price index for September is slated to be announced Wednesday morning. Economists expect prices for an array of consumer goods to jump 0.3% in September from the month prior and 5.3% year over year, according to Dow Jones.

Despite Monday’s selloff, the S&P 500 is up more than 13% this year and closed at a record just one week ago.

Some investors also are concerned that rising prices will pinch consumption and prompt central banks to withdraw stimulus, creating an environment of lower growth and higher inflation in which stocks tend to struggle.

Inflation accelerated to a 13-year high in the U.S. in June. Some evidence suggests that the price increases have started to knock consumers’ confidence in their ability to keep spending. For much of 2021, business reopenings, rising vaccination rates, and government pandemic aid have helped propel rapid gains in consumer spending, the economy’s main driver. 

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