US equities retreated midday Monday as traders prepared for a deluge of retail earnings reports and a US Federal Reserve (US Fed) symposium this week, while also awaiting news from a White House meeting over the war in Ukraine.
The S&P 500 Index slipped by 0.1% as of 1:04 pm in New York, led by the communications and real-estate sectors. Intel Corp was among the wost performers in the US stocks benchmark, declining as much as 5.5% as the Trump administration is reportedly in discussions to take a roughly 10% stake in the chip producer.
The tech-heavy Nasdaq 100 Index fell 0.2%, while Dow Jones Industrial Average was little changed. Investors are closely watching the blue-chip index after it eclipsed an intraday record on Friday but closed shy of an all-time high.
The moves come before a meeting Monday between US President Donald Trump, Ukrainian President Volodymyr Zelenskiy and other European leaders at the White House, which strategists say could generate headlines that ripple through markets.
“We doubt that we’ll see much of the ‘dog days of summer’ between now and Labor Day,” said Matt Maley, chief market strategist at Miller Tabak + Co. He noted that traders are watching the White House meeting and the Fed symposium in Jackson Hole, Wyoming, where Chair Jerome Powell is scheduled to speak Friday.
The annual central bank retreat comes after economic data last week showed a drop in consumer sentiment and an uptick in producer prices. A report from the New York Fed on Monday showed a decline in business services activity.
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“Markets are firmly convinced that the Fed will cut rates at its September meeting, yet data released over the past two weeks has failed to make a conclusive case for easing,” said Karl Schamotta, chief market strategist at Corpay.
“In our view, bad news is only good news if central banks are going to be cutting more because of the weaker economic data,” Emily Roland and Matt Miskin, co-chief investment strategists at Manulife John Hancock Investments, wrote in a Monday note.
Despite the weaker economic data, the S&P 500 has seen positive earnings revisions and a Citigroup Inc index tracking the relative number of US earnings-per-share estimate upgrades versus downgrades is at its highest level since December 2021.
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Despite weaker economic data, US firms have beat earnings expectations this reporting season, according to Goldman Sachs Chief US Equity Strategist David Kostin. Aggregated earnings per share are up 11% over the previous year, ahead of projections of 4%, the bank said.
Earnings reports due this week will provide traders additional data points on the health of the US consumer with Walmart Inc., Target Corp, The Home Depot Inc and Lowe’s Cos all releasing quarterly results. In tech, Palo Alto Networks Inc. is due to report after the bell Monday.
