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U.S. stocks close mixed as Dow loses 200 points

NEW YORK
2024-05-21 07:17

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NEW YORK, May 20 (Xinhua) -- U.S. stocks ended mixed on Monday, with technology stocks rising while the Dow pulled back from the 40,000 milestone it achieved last week.

The Dow Jones Industrial Average fell by 196.82 points, or 0.49 percent, to 39,806.77. The S&P 500 added 4.86 points, or 0.09 percent, to 5,308.13. The Nasdaq Composite Index increased by 108.91 points, or 0.65 percent, to 16,794.87, scoring its ninth record close this year.

Seven of the 11 primary S&P 500 sectors ended in red, with financials and consumer discretionary leading the laggards by losing 1.21 percent and 0.72 percent, respectively. Meanwhile, technology and communication services led the gainers by rising 1.32 percent and 0.34 percent, respectively.

Fed Vice Chair Philip Jefferson mentioned on Monday that while there has been a recent slowdown in certain critical inflation indicators, it's still early to determine if inflation is on a steady course towards the target of 2 percent. "It is too early to tell whether the recent slowdown in the disinflationary process will be long lasting. The better reading for April is encouraging," he said.

Atlanta Fed President Raphael Bostic noted that although the U.S. economy is robust at present, the central bank is confronted with substantial risks regarding the future outlook. Ongoing risks include "inflation, policy uncertainty, geopolitical risks," Bostic said.

"But then there are also questions concerning the transmission of monetary policy and relatedly whether a restrictive nominal fed funds rate is as effectively restrictive as the Federal Open Market Committee intends," Bostic noted.

Cleveland Fed President Loretta Mester also stated on Monday that while current policy is restrictive, policymakers must await further evidence regarding the inflation trajectory before considering adjustments to interest rates.

Mester, who had initially supported three rate cuts in the year, indicated a reevaluation given the first-quarter inflation data, suggesting that three cuts may no longer be suitable for 2024. "It's premature to gauge the inflation trajectory definitively; hence, we should gather more data before making decisions," she said.

Shares of JPMorgan Chase and Cisco retreated Monday afternoon, dragging the Dow Jones Industrial Average down. JPMorgan Chase's stock fell by 4.5 percent while Cisco's shares were down by 2.16 percent, causing a roughly 63-point decline in the Dow. Other notable contributors to this decline included Home Depot, down 1.86 percent, McDonald's, down 1.66 percent, and Travelers, down 1.87 percent.
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