Investing.com – U.S. stocks fall on Wednesday, led by rising Treasury yields and weakness in the industrial sector, as airline stocks fell sharply on demand concerns after American Airlines cut its forecasts of profits for the second quarter.
At 2:00 p.m. ET (18:00 GMT), it was down 341 points, or 0.9%, down 0.8%, and down 0.3%.
Industrial and energy stocks lead the decline
Airline stocks weighed heavily on the industrial sector after American Airlines Group (NASDAQ cut its second-quarter earnings forecast, sending its stock down more than 15%.
The downward guidance caused some on Wall Street to turn bearish amid concerns that American Airlines is struggling to keep up with competition from low- and ultra-cost airlines.
“AAL's revenue challenges are likely to persist beyond this summer, given the increasing growth of ultra-low-cost airlines in its major hubs,” Seaport Research Partners said in a Wednesday note while cutting its earnings outlook and downgraded American Airlines shares to neutral from buy.
Delta Air Lines (NYSE:), and Spiritual airlines (NYSE:) were also trading lower.
Meanwhile, the drop in energy stocks also affected the broader sector, ignoring the jump in marathon oil Corporation (NYSE:) after the latter agreed to be acquired by ConocoPhillips (NYSE:) in an all-stock deal worth $17.1 billion.
US Treasury yields continue to rise ahead of PCE data
Treasury yields continued to rise following a series of weaker-than-expected government bond auctions, including the $44 billion in 7-year notes auctioned Wednesday.
The rise in Treasury yields comes ahead of key inflation data this week. The data, which is the Federal Reserve's preferred inflation gauge, is due out this Friday and is likely to influence the central bank's outlook on interest rates.
Signs of persistent inflation have led several officials to suggest in recent days that they would like to see more evidence of cooling prices before they begin lowering rates from highs in more than two decades.
Salesforce Must Report Earnings; Dick's Sporting Goods jumped in time and rose
The quarterly corporate earnings season is gradually coming to a close, but Salesforce (NYSE:) has yet to report its fiscal first-quarter results after the bell, and Wall Street is likely to be keeping an eye on updates on the company's Data Cloud division. enterprise software group.
Shares of Dick's Sporting Goods (NYSE 🙂 soared 15% after the retailer raised its full-year guidance after customers spent more on new sneakers and sports gear at its department stores.
Robinhood in $1 billion share buyback plan, BHP walks away from Anglo deal
Trading platform Robinhood (NASDAQ rose 1.7% after revealing a $1 billion share buyback.
BHP Group Ltd ADR (NYSE was steady after deciding to end plans to acquire rival Anglo American (JO after the latter refused to extend talks beyond the May 29 deadline.
(Peter Nurse and Ambar Warrick contributed to this article.)
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