US stocks slide in cautious countdown to looming PCE

US stocks retreated on Wednesday, coming off a mixed close as caution prevailed ahead of a crucial inflation report that will guide expectations for interest rate cuts.

The Dow Jones Industrial Average and the S&P 500 were down nearly 0.2%. The Nasdaq Composite sagged almost 0.4%. Stocks have struggled in February’s final days as fresh economic data helped bring a market boosted by AI euphoria back to the reality of higher-for-longer interest rates. Investors have spent this week counting down to the PCE inflation reading on Thursday, seen as key in determining how quickly the Federal Reserve will start making rate cuts.

In the meantime, a report on fourth quarter GDP showed the economy grew at a slightly slower pace than initially thought in the final three months of 2023. The second estimate of fourth quarter GDP came in at 3.2% on Tuesday, down from the initial reading of 3.3%.

In other asset markets, bitcoin (BTC-USD) continued its roaring rally, breaking above $63,000 on Wednesday to come within striking distance of a fresh all-time high. The arrival of spot bitcoin ETFs has helped the cryptocurrency reach levels not seen since late 2021.

Among big movers, shares of Beyond Meat soared over 45% after the plant-based meat company laid out its turnaround plan, triggering a short squeeze.