US open: Stocks dip amid debt ceiling caution
Stocks in the US were trading slightly lower following the release of mixed economic data with investors keeping an eye out for further debt ceiling news.
At 1553 BST, the Dow Jones Industrial Average was drifting lower by 0.03% or 10.25 points to 33,276.52, alongside a dip of 0.32% or 12.67 points on the S&P 500, while the Nasdaq Composite was down by 0.24% or 30.47 points to 12,689.67.
In parallel, the yield on the benchmark two-month Treasury bill was off by nine basis points to 5.231%.
US President Joe Biden and Republican leader Kevin McCarthy failed to reach an agreement on the debt ceiling on Monday, but insisted that talks had been "productive". McCarthy said a deal could be done, while Biden said a default was "off the table".
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "Debt ceiling talks are inching forward, but it’s slow progress.
"If no agreement is reached, the US could default on interest it owes on its debts, sending borrowing costs soaring and sending shockwaves through the global economy. The forecast incoming mild recession would turn into a storm and the US financial credibility would be badly shaken. That’s why President Biden and Kevin McCarthy, the Republican House Speaker, are saying they are confident there will be no default, but it’s clear Republicans want to squeeze every drop of commitment to curtail spending out of the administration.
"With talks going to the wire, caution is set to stay front and centre on financial markets."
On the macro front, S&P Global's services sector Purchasing Managers' Index increased from a reading of 53.4 for April to 55.1 in May (consensus: 52.6).
But a separate PMI for factory activity fell from 50.2 to 48.5 (consensus: 50.0).
And the Department of Commerce reported that new home sales grew by 4.1% month-on-month to reach an annual rate of 683,000 (consensus: 660,000), helped by a dearth of existing homes for sale.
New home prices on the other hand fell rapidly as builders tried to lower inventory and Pantheon Macroeconomics said that the adjustment in prices had much further to run.
In corporate news, Lowe’s was in focus after its first-quarter earnings beat expectations but the home improvement retailer cut its full-year outlook.
It now expects total sales of around $87bn to $89bn, down from previous guidance of $88bn to $90bn and adjusted diluted earnings per share of $13.20 to $13.60, down from $13.60 to $14.00.
Broadcom was adding 1% after inking a fresh multibillion-dollar deal with Apple for the design of 5G radio frequency components.
Dow Jones - Risers
Chevron Corp. (CVX) $157.19 3.12%
Home Depot Inc. (HD) $296.74 2.24%
Walgreens Boots Alliance, Inc. (WBA) $31.70 1.64%
3M Co. (MMM) $102.63 0.90%
Boeing Co. (BA) $207.13 0.59%
Amgen Inc. (AMGN) $225.16 0.52%
Dow Chemical Co. (DOW) $52.03 0.51%
Verizon Communications Inc. (VZ) $36.11 0.44%
Goldman Sachs Group Inc. (GS) $326.32 0.43%
Cisco Systems Inc. (CSCO) $49.01 0.31%
Dow Jones - Fallers
Visa Inc. (V) $225.76 -2.39%
Intel Corp. (INTC) $29.89 -1.30%
Merck & Co. Inc. (MRK) $113.37 -0.98%
Salesforce.Com Inc. (CRM) $208.48 -0.85%
McDonald's Corp. (MCD) $287.10 -0.78%
Apple Inc. (AAPL) $172.90 -0.75%
Microsoft Corp. (MSFT) $319.12 -0.64%
Unitedhealth Group Inc. (UNH) $478.90 -0.36%
Procter & Gamble Co. (PG) $148.64 -0.35%
Walt Disney Co. (DIS) $91.68 -0.15%
S&P 500 - Risers
Vornado Realty Trust (VNO) $14.56 6.43%
Zions Bancorporation (ZION) $29.80 6.09%
Albemarle Corp. (ALB) $217.04 5.10%
Comerica Inc. (CMA) $41.58 4.80%
Lincoln National Corp. (LNC) $22.83 4.44%
Norwegian Cruise Line Holdings Ltd (NCLH) $14.89 3.91%
American International Group Inc. (AIG) $55.87 3.54%
Hanesbrands Inc. (HBI) $4.32 3.47%
Keycorp (KEY) $10.63 3.40%
United Airlines Holdings Inc (UAL) $48.99 3.33%
S&P 500 - Fallers
Idexx Laboratories Inc. (IDXX) $466.39 -4.08%
Nektar Therapeutics (NKTR) $0.70 -3.46%
AutoZone Inc. (AZO) $2,533.68 -3.29%
Willis Towers Watson Public Limited Company (WTW) $223.15 -2.96%
Hilton Inc (HLT) $139.65 -2.72%
Gallagher Arthur J (AJG) $209.40 -2.42%
Visa Inc. (V) $225.76 -2.39%
Universal Health Services Inc. (UHS) $132.04 -2.37%
Zoetis Inc (ZTS) $175.45 -2.27%
Nucor Corp. (NUE) $136.82 -2.25%
Nasdaq 100 - Risers
Qurate Retail Inc. (QRTEA) $0.97 4.00%
Vodafone Group Plc ADS (VOD) $10.41 2.76%
Liberty Global plc Series A (LBTYA) $17.33 1.94%
Liberty Global plc Series C (LBTYK) $18.14 1.65%
Tesla Inc (TSLA) $191.99 1.65%
Walgreens Boots Alliance, Inc. (WBA) $31.70 1.64%
Broadcom Inc. (AVGO) $687.05 1.28%
Dish Network Corp. (DISH) $6.86 1.18%
American Airlines Group (AAL) $14.54 1.11%
Intuit Inc. (INTU) $457.27 0.70%
Nasdaq 100 - Fallers
Idexx Laboratories Inc. (IDXX) $466.39 -4.08%
NetEase Inc. Ads (NTES) $86.04 -2.81%
Wynn Resorts Ltd. (WYNN) $106.05 -2.18%
Marriott International - Class A (MAR) $170.98 -2.12%
Cadence Design Systems Inc. (CDNS) $207.62 -1.89%
Vertex Pharmaceuticals Inc. (VRTX) $333.55 -1.89%
Asml Holdings N.V. (ASML) $685.99 -1.81%
Dollar Tree Inc (DLTR) $157.21 -1.75%
JD.com, Inc. (JD) $35.41 -1.61%
Cintas Corp. (CTAS) $464.20 -1.57%