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S&P 500 Off Session Lows, but Surprise Rise in Retail Sales Stokes Fed Fears By


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By Yasin Ebrahim – The S&P 500 moved off session lows Thursday, but remained under pressure as an unexpected rise in monthly retail sales stoked concerns that the Federal Reserve could tighten policy sooner rather than later.

The fell 0.2%, the slipped 0.2%, or 73 points, the Nasdaq was flat.

“[T]he Treasury curve bear steepened and the S&P500 fell presumably on the good news is bad for Fed expectations logic,” Scotiabank said in a note.

According to the Commerce Department, retail sales increased on Thursday. That confounded economists’ forecast for a 0.8% decline. The retail sales control group – which has a larger impact on U.S. GDP –   topping expectations for a 0.1% decrease. 

“Retail sales rebounded in August, despite sizable drag from auto sales. Outside of autos, sales posted broad-based increases, with particular strength in online sales, general merchandise and furniture sales,” Jefferies (NYSE:) said in a note.

The U.S. Department of Labor reported increased by 20,000 to 332,000 in the week ended Sept. 11, missing forecasts for a 18,000 decline.

Positive economic data did not stimulate cyclical markets as the most performing sector on the day was energy and materials.

Newmont Goldcorp Corp (NYSE:), Martin Marietta Materials (NYSE:), and Freeport-McMoran Copper & Gold (NYSE:), were the worst performers in materials, with the latter down more than 6%.

Freeport-McMoran Copper & Gold Inc (NYSE:) deepens its losses amid an ongoing decline in prices as tailwinds including stimulus and inflation concerns are expected to fade.

Energy, however, lost some of its gains despite oil prices reducing its losses.

Tech stocks did not make any gains due to the favorable economic data that raised Treasury yields.

Alphabet, Google’s parent (NASDAQ), Facebook (NASDAQ), and Microsoft were all in red.

Beyond Meat fell 4.4% in other news after Piper Sandler reduced the stock’s weight to neutral from underweight and reduced its target price to $95, from $120. This was due to the expectation of slowing future sales.

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