US stocks to incur losses in Feb. as rate concerns accelerate

The S&P 500 retreated and the main US indexes are expected to record monthly losses on Tuesday as Treasury yields surged while investors are focused on bets concerning upcoming interest rate decision which is seen high for longer. Bank of America Global Research warned the Fed could even hike interest rates to nearly 6%.

US indexes witnessed a volatile February after a strong performance at the start of the year as signs of strength in the US economy and elevated inflation spurred worries that the Fed will stick to its hawkish policy for longer.

Dow slid on Tuesday as Goldman Sachs fell 2.5% after Chief Executive David Solomon said the bank is considering “strategic alternatives” for its consumer business, while the tech-heavy Nasdaq stayed flooded.

The yield on two-year Treasury notes, which tracks investors’ expectations of the path of interest rates, slipped to 4.79% but traded just below a near four-month high hit in the previous session.

At 11:49 a.m. ET, the Dow Jones Industrial Average (.DJI) was down 156.71 points, or 0.48%, at 32,732.38, the S&P 500 (.SPX) was down 3.59 points, or 0.09%, at 3,978.65, and the Nasdaq Composite (.IXIC) was up 4.86 points, or 0.04%, at 11,471.83.

Meta Platforms rose 3.2% after the Facebook parent said it was creating a new top-level product group focused on generative artificial intelligence.

Target Corp rose 2.3% after the big-box retailer reported a surprise rise in holiday-quarter sales but cautioned on 2023 earnings due to an uncertain US economy.

Zoom Video Communications Inc climbed 1.7% after it forecast annual profit above Wall Street estimates and said it will integrate more AI into its products.

Norwegian Cruise Line Holdings Ltd (NCLH.N) slid 11.5% after the cruise operator’s full-year profit forecast fell short of estimates, as it feels the squeeze from soaring fuel and labor costs.

Advancing issues outnumbered decliners by a 1.35-to-1 ratio on the NYSE and 1.34-to-1 ratio on the Nasdaq.

The S&P index recorded seven new 52-week highs and eight new lows, while the Nasdaq recorded 57 new highs and 71 new lows.