By Will Horner and Julia Carpenter 

U.S. stocks faltered on Tuesday, with major indices hovering around the flat line, while bitcoin prices fell again after a period of volatile trading.

The S&P 500 slipped 8.92 points, or 0.2%, to 4,188.13, and the Dow Jones Industrial Average was down 81.52 points, or 0.2%, to 34,312.46. The Nasdaq Composite lost 4 points, or less than 0.1%, to 13,657.17. All three indices had opened slightly higher before they ran out of steam.

Shares surged to start the week, with recent comments from Federal Reserve officials helping allay fears that rising inflation could stifle growth or prompt the central bank to suddenly tighten policy.

“The comments we have received from Fed speakers have told the market exactly what it wants to hear: that they are not concerned about the inflation data and that it has not changed their plan to be very cautious, ”said Hugh Gimber, a strategist at JP Morgan Asset Management.

Bitcoin prices edged down after several days of whipsaw trading for the cryptocurrency markets. Bitcoin edged down to $ 37,507, according to CoinDesk, going from $ 38,999 at 5 p.m. ET on Monday.

“There is a lot of fairly concentrated speculative betting out there,” said Jason Pride, director of private investments at Glenmede. “Last year it was all about technology and growth, then it moved to PSPC, then it moved to bitcoin, and now we’re seeing some of that unfold.”

New data from the US real estate market indicates that house price growth spiked in March to its highest level in 15 years. Even though early indications suggest that home sales are slowing, strong housing demand continues to outstrip supply. The S&P CoreLogic Case-Shiller National House Price Index showed a double-digit annual increase for the fourth consecutive month.

“There is this pervasive fear in the market that it is an economy that is dramatically overheating and that great inflationary pressures are looming,” said Brian Levitt, Global Market Strategist at Invesco.

“When you see days like today, with housing cooling a bit and rates falling a bit and tech stocks outperforming, it’s a day that pushes back this ‘massively overheated, massively inflationary environment’ narrative. which really grabbed US and global investors. ”

Following a gain in April, new US consumer confidence data for May was virtually unchanged, indicating that Americans’ optimism for the economy has stabilized slightly.

In corporate news, shares of Moderna rose 2.8% after the drugmaker said its Covid-19 vaccine was effective in children ages 12 to 17.

Lordstown Motors fell 9% after the electric truck startup said it faced higher-than-expected costs and cut its production forecast for 2021. AutoZone slipped 2.1%, despite the news that the auto parts retailer’s sales exceeded expectations.

As the vaccine rollout continues and the country reopens, cruise line sales have increased, with Royal Caribbean Group’s shares increasing nearly 3.6%. Norwegian Cruise Line Holdings and Carnival rose 3.5% and 2.6% respectively.

“There is a lot of pent-up demand,” Mr. Levitt said. “You hear about it and we all feel it. Americans want to stay in hotels, go to lounges and spend their money.”

Brent crude oil, the world’s benchmark for oil, rose 0.3% to $ 68.65 per barrel. Gold, a typical hedge against inflation, edged up 0.7% to $ 1,898.10 per troy ounce.

Yields on US government bonds have fallen. The yield on the benchmark 10-year US Treasury note fell to 1.563% from 1.608% on Monday. Yields move inversely with prices.

Overseas, the Stoxx Europe 600 grew by less than 0.1%. In China, the Shanghai Composite Index jumped 2.4%, its biggest one-day gain since October, pushing it to its highest closing level in three months.

Chinese officials have expressed concerns in recent days over rising prices for commodities such as iron ore and copper, which has helped allay investor concerns about inflation, said Steven Leung, executive director of institutional sales at UOB Kay Hian in Hong Kong.

Japan’s Nikkei 225 rose 0.7%, while in Hong Kong, the Hang Seng rose 1.8%.

Joanne Chiu contributed to this article.

Write to Will Horner at [email protected] and to Julia Carpenter at [email protected]

(END) Dow Jones News Wire

May 25, 2021 at 4:56 p.m. ET (8:56 p.m. GMT)

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