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Wall Street opens lower; Gap, Nordstrom sink on weak results

Stocks are opening lower on Wall Street as the market continues an unsettled period of trading ahead of the Thanksgiving holiday in the United States.

November 24, 2021 / 08:52 PM IST
Wallstreet.

Wallstreet.

Stocks are opening lower on Wall Street as the market continues an unsettled period of trading ahead of the Thanksgiving holiday in the United States. The S&P 500 gave back 0.3 percent in the early going on November 24.

The benchmark index, which set a record high last Thursday, was weighed down by losses in technology and consumer-focused companies. Tesla fell nearly four percent, while Gap sank 20 percent after reporting results that came in far below analysts forecasts. Nordstrom gave up 25 percent after it also reported very weak results. European markets were lower and Asian markets closed mixed. Crude oil prices slipped.

TOKYO Global shares were mixed Wednesday as worries about inflation set off expectations the US Federal Reserve might move faster than anticipated to raise interest rates.

France's CAC 40 edged up 0.4 percent to 7,074.05 in early trading, while Germany's DAX rose 0.1 percent to 15,955.14. Britain's FTSE 100 added 0.5 percent to 7,303.68. The future for the Dow Jones Industrial Average edged 0.1 percent lower to 35,744.00. The S&P 500 future fell 0.1 percent to 4,685.00.

Stocks are likely to see more mixed trading this week, with US markets closing on Thursday for Thanksgiving and then closing early on Friday.

Close

In Asian trading, Japan's Nikkei 225 dropped 1.6 percent to finish at 29,302.66, following a national holiday Tuesday. Technology shares especially took a hit over the speculation about the Fed's moves. South Korea's Kospi slipped 0.1 percent to 2,994.29. In Australia, the S&P/ASX 200 edged down 0.2 percent to 7,399.40. Hong Kong's Hang Seng rose 0.1 percent to 24,685.50, while the Shanghai Composite edged up 0.1 percent to 3,592.70.

Markets continue to shift their expectations toward a tighter Fed monetary policy," said Yeap Jun Rong, a market strategist at IG, adding that investors will be watching for US data being released later in the day.

Wall Street will get a few pieces of economic data on Wednesday that could give investors a better sense of the economic recoverys pace and breadth.

The Labor Department will release its weekly report on unemployment benefits. The Commerce Department releases data on third-quarter gross domestic product and its new home sales report for October.

The Fed will release minutes later in the day from its October policy meeting, potentially giving investors more details on the central banks plan to start trimming bond purchases that have helped keep interest rates low.

Some Asian central banks have already begun to raise interest rates to tamp down inflation. New Zealand's raised its benchmark interest rate by 0.25 percent Wednesday to 0.75 percent.

In October the Reserve Bank raised it from a record low 0.25 percent to 0.5 percent, the first such hike in more than seven years, removing some support it put in place when the coronavirus pandemic began.

Investors have been watching to see if pressure from rising inflation will goad the Fed into speeding up its plans for trimming bond purchases and raising its benchmark interest rate.

The price of US crude oil rose extended gains after President Joe Biden ordered 50 million barrels of oil released from the nations strategic reserve to help bring down energy costs. The move was made in concert with other big oil-consuming nations, including Japan, South Korea and India.

On Tuesday, benchmark US crude jumped 2.3 percent and wholesale gasoline rose 3.4 percent.

The release of the oil reserves may not necessarily bring down oil prices, but analysts say it may serve as a message to OPEC. Biden has been urging other big oil producers to more quickly raise output to match higher demand as economies recover from earlier phases of the pandemic.

On Wednesday, benchmark US crude rose 42 cents to $78.92 a barrel. Brent crude, the international standard, added 45 cents to $82.76 a barrel.

The US dollar fell to 114.95 Japanese yen from 115.15 yen. The euro cost $1.1238, down from $1.1249.

 
Associated Press
first published: Nov 24, 2021 08:52 pm

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