By Caroline Valetkevitch
NEW YORK (Reuters) – U.S. stocks fell on Tuesday as investors weighed chances that the Federal Reserve could delay cutting interest rates, while shares of Tesla (NASDAQ ) fell after the automaker electric companies will record fewer quarterly deliveries for the first time in almost four years.
Tesla shares fell more than 5% and were among the biggest drags on the Nasdaq.
Adding to caution, 10-year US Treasury yields rose to their highest level since late November.
“The 'higher for longer' narrative is coming back into play despite the fact that the Federal Reserve is forecasting a rate cut sometime this year. So this has the market worried,” said Quincy Krosby , chief global strategist at LPL Financial (NASDAQ). 🙂 in Charlotte, North Carolina.
Recent strong U.S. economic reports have raised questions about whether the Federal Reserve could deliver the three rate cuts outlined in its latest forecast.
Data on Tuesday showed that new orders for U.S. manufactured goods rebounded more than expected in February, while U.S. job openings held steady at higher levels.
They fell 437.15 points, or 1.1%, to 39,129.7. The S&P 500 lost 46.03 points, or 0.88%, to 5,197.74 and fell 190.95 points, or 1.16%, to 16,205.89.
Health care stocks were among the worst performers of the day. UnitedHealth (NYSE , CVS Health (NYSE ) and Humana (NYSE fell as the U.S. government left reimbursement rates unchanged for Medicare Advantage health plan providers, in a setback for insurers.
Wall Street's fear gauge hit a more than two-week high.
Traders are pricing in a near 57% chance that the Federal Reserve will cut interest rates by at least 25 basis points in June, up from 64% just a week ago, according to CMEGroup's FedWatch tool.
Investors are eagerly awaiting Friday's US nonfarm payrolls data. Additionally, several Federal Reserve officials will speak this week.
Among those falling, shares of Calvin Klein parent PVH Corp (NYSE:) plunged after the retailer forecast a roughly 11% drop in first-quarter revenue.
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Declining issues outnumbered advancing ones on the New York Stock Exchange by a ratio of 3.50 to 1; On the Nasdaq, a ratio of 3.08 to 1 favored decliners.
The S&P 500 recorded 22 new 52-week highs and four new lows; The Nasdaq Composite recorded 43 new highs and 113 new lows.
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