U.S. stock markets retreat from highs; Fed and Salesforce in focus


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US stock indices fell on Wednesday and fluctuated after the Nasdaq index hit new highs, with attention focused on upcoming inflation data and more signals about interest rates.

The Nasdaq Composite ended Tuesday up 0.6% at a new all-time high, supported by strong gains in Nvidia (NVDA), Wall Street’s third-biggest stock by market capitalization. The S&P 500 closed barely higher, while the Dow Jones Industrials lost about 0.6%.

Interest rate concerns are on the rise amid Federal Reserve speeches and economic policy analysis

US stock markets continue to moderate ahead of this week’s inflation data. The PCE price index data, which is the Fed’s favored gauge, is due out on Friday and is likely to influence the Fed’s interest rate estimates.

Signs of stronger inflation have prompted officials to indicate in recent days that they would like to see more signs of cooling prices before beginning to lower rates from more than 20-year highs.

Minneapolis Fed President Neel Kashkari signaled on Tuesday that the Fed had not yet ruled out rate hikes.

Other Fed officials, including New York Fed President John Williams and Cleveland Fed President Loretta Mester, will have a chance to speak before Friday’s reading.

The Federal Reserve’s Beige Book will be released on Wednesday, while the revised first quarter economic growth report will be released on Thursday. 

Salesforce Results

The earnings season for the first quarter of the year is coming to a close, although Salesforce (CRM) has yet to release its fiscal first quarter results after the bell. Wall Street is likely to await updates on the enterprise software group’s Data Cloud division.

American Airlines (AAL) fell about 8% before the market opened after cutting its second-quarter earnings estimates following Tuesday’s close, due to reduced expectations about travel demand.

This caused airlines to fall across the board, with Delta Air Lines (DAL), United Airlines (UAL) and Spirit Airlines (SAVE) trading lower.

ConocoPhillips (COP) shares dropped 0.7% pre-market after the Financial Times reported that the energy company is in advanced discussions to acquire Marathon Oil (MRO), which rose 6%, in an all-stock deal potentially valuing it at just over its $15 billion market value.

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