STORY: Stocks slid on Tuesday in the biggest selloff of the year as strong economic data left investors, once again, fretting over the future of interest rates.
A survey on business activity – called S&P Global Purchasing Manufacturer’s index — returned to expansion for the first time in eight months in February, leaving investors to conclude that the federal reserve will need to keep interest rates higher for longer to control inflation.
The Dow and the S&P fell about 2% each while the Nasdaq dropped even more than that.
Tuesday’s plunge comes after a super-charged start of the year.
Brad Bernstein, managing director with UBS Wealth Management, says despite investors’ sudden jitters it’s still a great time to get into the market.
“If we were to get better than expected data this week on Friday, you will see the opposite of today.
I think so. You got to stay invested. You got to stay diversified, and I think over the next six, 5-6 months, this is a fabulous time to be investing,”
Home Depot plunged 7% to a three-month low after the No. 1 domestic home improvement chain warned of weakening demand and issued a lower profit forecast for 2023.
Smaller rival Lowe’s fell 5% ahead of its results next week.
Walmart posted full-year earnings below estimates and painted a grim picture of hotter-than-expected food inflation squeezing profit margins. However, the world’s largest retailer recovered from an initial decline to advance nearly 1 percent.
While Meta Platforms ended fractionally lower. The Facebook parent had initially been buoyed by confirmation it was testing a monthly subscription service called Meta Verified, which will let users verify their accounts using a government ID and get a blue badge.
All of the major 11 S&P 500 sectors fell, with the consumer discretionary sector faring the worst.