Wall Street’s major indices have fallen after initially opening higher last week as a rally on easing concerns over inflation, which has slowed down, with high-growth stocks leading the declines.
“We had a nice rally last week, so I think we’re seeing a little bit of a profit this morning,” said Dennis Dick, a private trader at Bright Trading LLC in Las Vegas.
“The stocks that have risen the most in the past week are hit hardest here today.”
The tech-heavy Nasdaq Composite Index, which gained 7.5 percent last week, fell 0.7 percent on declines in the three major indices.
Investors were betting on the slump in oil prices after June’s three-month highs to potentially ease inflationary pressures and likely prompt the Federal Reserve to moderate its aggressive policy tightening.
However, data from Monday showed that new orders for US-made capital goods and shipments rose sharply in May, pointing to continued strength in corporate equipment spending in the second quarter.
Oil prices also bounced back, pushing the S&P 500 energy index up 2.2 percent, pushing inflation expectations down on lower energy prices.
The US central bank has quickly raised interest rates to contain 40-year high inflation, fueling fears that its actions could send the world’s largest economy into recession.
After the benchmark S&P 500 index plunged 20 percent from its closing peak in January to confirm a bear market earlier this month, investors have been trying to gauge when the market might bottom out.
During early trading, the Dow Jones Industrial Average fell 76.62 points or 0.24 percent to 31,424.06, the S&P 500 fell 13.94 points or 0.36 percent to 3,897.80 and the Nasdaq Composite fell 78. .44 points or 0.68 percent, at 11,529.19.
Shares of Robinhood Markets rose 0.6 percent after media reports said Goldman Sachs upgraded the retail broker’s stock from “sell” to “neutral.”
However, Goldman Sachs downgraded Coinbase Global Inc to “sell” from “buy,” according to media reports, pushing shares of the cryptocurrency exchange down 9.4 percent.
The number of declining issues surpassed the avant-garde by a 1.03-to-1 ratio on the NYSE and a 1.31-to-1 ratio on the Nasdaq.
The S&P index recorded a new 52-week high and 29 new lows, while the Nasdaq recorded 16 new highs and 41 new lows.