US equities retreat as Biden-Powell meeting in focus

Investors do not seem so much worried about US President Joe Biden’s meeting with Fed Chair Jerome Powell, on Tuesday. Biden is urging the Fed to keep its focus on ways to control US inflation as a message to markets that inflation fighting has become the highest priority of the Fed’s dual mandates versus getting to full employment.

The S&P 500 fell slightly on Tuesday after successive three session rally as volatile trading in oil prices kept soaring inflation in focus and investors reacted to hawkish comments from a Federal Reserve official. Eight of the 11 major S&P 500 sectors were declining and after outperforming earlier in the session, energy lost ground and was last down 0.8% in late afternoon trading as oil prices turned negative. Healthcare and real estate were the biggest laggards for the session up to now. All three indexes had rallied last week.

The S&P 500 posted four new 52-week highs and 29 new lows; the Nasdaq Composite recorded 46 new highs and 41 new lows. Enhanced by last week’s rally, the S&P 500 was up 0.5% for the month of May while the Dow was up 0.4% for the month. The tech-heavy Nasdaq was set for a 1.7% decline for the month.

Data showed US consumer confidence eased modestly in May amid persistently high inflation and rising rates, while a separate reading showed US home price growth unexpectedly heated up to record levels in March. Other key data due this week is non-farm payrolls numbers for cues on the labor market.

This was after a report that some OPEC members were pondering the idea of exempting Russia from participation in an oil-production deal, paving the way for other members to pump significantly more crude oil.

US-listed shares of Yamana Gold Inc climbed after South African miner Gold Fields Ltd (GFIJ.J), agreed to buy the Canadian miner in a $6.7 billion all-share deal. Dexcom jumped after the glucose monitoring systems maker denied a report on merger talks with insulin pump maker Insulet Corp.

The CBOE volatility index snapped a three-day decline and was last up at 37 points. Declining issues outnumbered advancing ones on the NYSE by a 1.66-to-1 ratio; on Nasdaq, a 1.30-to-1 ratio favored decliners.