US close: Stocks slip, Dow ends May in the red

Wall Street's major indices closed lower on Wednesday, with investors holding their collective breath for a crucial vote on the federal debt ceiling deal set to take place in the House of Representatives later in the evening.

At the close, the Dow Jones Industrial Average was down 0.41% at 32,908.27, while the S&P 500 fell 0.61% to settle at 4,179.83.

The tech-heavy Nasdaq Composite declined 0.63% to finish the session at 12,935.29.

Wednesday also marked the last trading day of May, with the Dow logging a monthly loss of 3.5%, while both the S&P 500 and the Nasdaq Composite ended it in the green.

On the currency front, the dollar was last 0.04% stronger on sterling to trade at 80.41p, as it advanced 0.03% against the common currency to 93.58 euro cents.

It dipped marginally against the yen, however, last falling 0.01% to change hands at JPY 139.32.

“Markets have not been able to find their footing this afternoon, and as well as the US debt ceiling, are also grappling with renewed signs of a slowdown in China,” said IG chief market analyst Chris Beauchamp.

“The boost from the reopening of China’s economy seems to have faded altogether, and this has meant that recession fears are front and centre once more.

“The debt ceiling now seems to be mostly a procedural problem, but until it is resolved markets seem determined to remain on edge.”

Sentiment hit by poor data out of Chicago, China

On the data front, the economic vigour of the Chicago area saw a marked decline in May, with the MNI Chicago business barometer shifting downwards to 40.4, from 48.6 in April.

The drop was notably sharper than consensus estimates, which had anticipated a milder decline to 47.0.

“The Chicago PMI broadly tracks the lagged trend in civilian aircraft orders - Boeing is headquartered in Chicago - which jumped in the second half of last year, but aircraft orders have dipped more recently as the post-Covid rebound in air travel has petered out,” said Kieran Clancy at Pantheon Macroeconomics.

“The full suite of regional manufacturing surveys points to a one-point drop in the national ISM manufacturing index, due tomorrow; remember that the regional surveys are much more volatile than the national ISM index due to their small samples.

“Either way, the big picture here is that the manufacturing sector remains firmly in recession, as the ongoing deterioration in domestic demand - due to higher rates and dwindling capital availability - is offsetting any boost from the re-opening of China’s economy.”

On the international front, Wednesday also brought concerning news on the economic recovery in China, as factory activity diminished at a faster pace than anticipated amid softening demand.

According to the National Bureau of Statistics, the official manufacturing purchasing managers' index (PMI) fell to a five-month trough of 48.8 in May.

The decline, down from 49.2 in April, fell short of the expected rise to 49.4, and was below the 50-point level that separates contraction from expansion.

In addition, the non-manufacturing PMI, which measures the performance of the services sector, descended to 54.5 from 56.4.

There was also a downward trend in the new orders sub-index and the new export orders sub-index, which respectively dropped to 48.3 and 47.2 in May, down from 48.8 and 47.6 in April.

American Airlines ascends, Advance Auto Parts plunges on earnings

In equities, American Airlines Group ascended 1.09% after the legacy carrier upgraded its profit outlook for the second quarter.

Software company Twilio jumped 11.09% on the back of reports that an activist investor was advocating for a reorganisation of the firm's board, and potentially streamlining operations.

On the downside, Ambarella slid 11.76% after the semiconductor maker projected second-quarter revenue short of analysts' expectations.

Advance Auto Parts plunged 35.04% after the car parts retailer reported first-quarter earnings that missed expectations, and announced it was cutting its quarterly dividend and reducing its annual earnings guidance.

Reporting by Josh White for Sharecast.com.

DOW JONES INDUSTRIAL AVERAGE -134.51 (-0.41%) 32,908.27

RISERS
Intel Corporation +4.84% $31.44
Verizon Communications +2.09% $35.63
Salesforce Inc +2.06% $223.38
UnitedHealth Group +1.54% $487.24
Walgreens Boots Alliance +1.47% $30.37
Merck & Co +1.14% $110.41
Amgen Inc +0.97% $220.65
Walmart Inc +0.56% $146.87
Boeing Co +0.49% $205.70
Johnson & Johnson +0.45% $155.06

FALLERS
3M Co -2.86% $93.31
Home Depot -2.36% $283.45
Travelers Companies -2.34% $169.24
Caterpillar Inc -1.98% $205.75
Chevron Corporation -1.63% $150.62
Honeywell International -1.52% $191.60
Dow Inc -1.46% $48.78
Goldman Sachs Group -1.35% $323.90
JPMorgan Chase & Co -1.27% $135.71
Nike Inc -1.18% $105.26

S&P 500 -25.69 (-0.61%) 4,179.83

RISERS
Intel Corporation +4.84% $31.44
Edwards Lifesciences Corporation +3.46% $84.23
Dexcom Inc +3.26% $117.26
Intuit Inc +3.21% $419.12
Jack Henry & Associates +2.92% $152.89
Edison International +2.74% $67.52
Pfizer Inc +2.73% $38.02
Amerisourcebergen Corporation +2.49% $170.15
Constellation Brands +2.49% $242.97
Molson Coors Beverage Co +2.4% $61.85

FALLERS
Advance Auto Parts -35.04% $72.89
Hewlett Packard Enterprise -7.09% $14.42
HP Inc -6.05% $29.06
KeyCorp -5.94% $9.34
Nvidia Corporation -5.68% $378.34
Newell Brands -5.68% $8.31
Advanced Micro Devices -5.64% $118.21
Zions Bancorporation -5.6% $27.29
Genuine Parts Co -5.56% $148.93
Citizens Financial Group -5.12% $25.78

NASDAQ COMPOSITE -82.14 (-0.63%) 12,935.29

RISERS
Atlassian Corporation +7.07% $180.79
Intel Corporation +4.84% $31.44
Dexcom Inc +3.26% $117.26
Intuit Inc +3.21% $419.12
Airbnb Inc +2.41% $109.77
AstraZeneca +2.31% $73.08
Autodesk Inc +2.23% $199.39
Zoom Video Communications +2.21% $67.13
Xcel Energy +1.78% $65.29
American Electric Power Company -1.63% $83.12

FALLERS
Marvell Technology -7.75% $58.49
Nvidia Corporation -5.68% $378.34
Advanced Micro Devices -5.64% $118.21
Micron Technology -4.87% $68.20
KLA Corporation -3.43% $442.99
PDD Holdings -3.42% $65.32
Paccar Inc -3.35% $68.78
O’Reilly Automotive -2.67% $903.31
Dollar Tree -2.6% $134.88
Applied Materials -2.39% $133.30