US STOCKS-Wall Street stocks slip, rising US Treasury yields in focus

Reuters
21 May
US STOCKS-Wall Street stocks slip, rising US Treasury yields in focus

Indexes down: Dow 0.27%, S&P 500 0.39%, Nasdaq 0.38%

Tesla rise after Musk says committed to being CEO

Home Depot reverses gains following Q1 sales beat

Updates to 4:10 PM ET

By Chibuike Oguh

NEW YORK, May 20 (Reuters) - U.S. stocks fell on Tuesday, with the benchmark S&P 500 ending six straight sessions of gains, under pressure from rising Treasury yields, with the U.S. sovereign debt profile in focus.

President Donald Trump traveled to Capitol Hill, seeking to persuade Republican lawmakers to pass a sweeping tax-cut bill, which analysts estimate will possibly add $3 trillion-$5 trillion to the federal government's $36.2 trillion in debt.

The Dow snapped three consecutive sessions of gains and the Nasdaq fell after a two-session winning streak.

Eight out of 11 of the S&P 500's sectors fell, led by losses in energy, communication services, consumer discretionary stocks. Utilities, healthcare and consumer staples equities made gains.

"It's a little bit of an excuse just after the run that we've had to hit the pause button and see markets consolidate a little bit and a little bit of churn under the surface ... that's what we're seeing right now," said Garrett Melson, portfolio strategist at Natixis Investment Managers in Boston.

"But obviously when you look across to the fixed-income world, you're seeing a huge bid that came back into the market yesterday. ... now we're back to the races with yields pushing higher."

The Dow Jones Industrial Average .DJI fell 114.83 points, or 0.27%, to 42,677.24, the S&P 500 .SPX lost 23.14 points, or 0.39%, to 5,940.46 and the Nasdaq Composite .IXIC lost 72.75 points, or 0.38%, to 19,142.71.

Investors were also eyeing commentary on the monetary policy outlook from several Federal Reserve officials, including St. Louis Fed President Alberto Musalem.

Moody's and the other big ratings agencies Fitch and S&P Global Ratings have downgraded the U.S. sovereign credit, citing the government's debt profile.

Traders currently expect at least two 25-basis-point Fed rate cuts by the end of 2025, with the first expected in September, according to data compiled by LSEG. The yield on benchmark U.S. 10-year notes US10YT=RR rose 0.4 basis points to 4.481%.

Home Depot HD.N fell 0.6%, reversing early gains, after the home improvement retailer reported first-quarter sales that beat Wall Street estimates.

Tesla TSLA.O rose 0.5% after Chief Executive Elon Musk said at an economic forum in Qatar that he was still committed to being CEO in five years.

Other technology heavyweight stocks fell, including Nvidia NVDA.O. The chipmaker is scheduled to report quarterly earnings on May 28.

Declining issues outnumbered advancers by a 1.37-to-1 ratio on the NYSE. There were 219 new highs and 33 new lows on the NYSE.

The S&P 500 posted 19 new 52-week highs and no new lows while the Nasdaq Composite recorded 59 new highs and 46 new lows.

Volume on U.S. exchanges was 16.14 billion shares, compared with the 17.38 billion average for the full session over the last 20 trading days.

(Reporting by Chibuike Oguh in New York; additional reporting by Shashwat Chauhan and Kanchana Chakravarty in Bengaluru; Editing by Pooja Desai and David Gregorio)

((Chibuike.Oguh@thomsonreuters.com; +332-219-1834; Reuters Messaging: chibuike.oguh.thomsonreuters.com@reuters.net))

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