On Tuesday, Wall Street closed the day lower, as investors were focused on data highlighting a slowdown in the economy, ahead of the gathering of central bankers later this week in Jackson Hole, Wyoming.

Disappointing data

There was a decline in the S&P 500 after data showed that there was a contraction in the business activity of the private sector for the second consecutive month in August.

The services sector saw a great deal of softness because of a weakening demand brought on by tightening financial conditions and soaring inflation.

There was a drop in the PMI of the S&P Global to 45 in the month of August, which was its lowest value since February last year.

The number had stood at 47.7 in July and a reading below 50 shows a contraction in economic activity. Recent sessions have seen stocks decline ahead of the symposium later this week in Jackson Hole.

The chairman of the Federal Reserve, Jerome Powell is expected to reiterate the bank’s commitment to stamping out inflation that has climbed to four-decade highs.

Traders are divided between a hike of 50 basis points and 75 basis points by the Fed in September after a number of central bankers pushed back against the possibility of a dovish stance.

Market analysts said that it is still possible that the Fed could go with a 75bps hike in the next month as well and the market is fearful of it.

Indexes

There was a decline recorded in 7 of the 11 sectors of the S&P 500, with real estate leading losses, as it declined by 1.46%, while healthcare suffered from a loss of 1.39%.

Markets had a difficult start to the year, but have been rallying since mid-June over hopes that inflation had finally hit its peak.

However, the summer rally came to an end in the previous week over fears that the Fed would continue to stick to its aggressive monetary policy tightening path.

There was a 0.22% drop in the S&P 500, as it ended the session at 4,128.73 points. The Dow Jones Industrial Average also recorded a 0.47% drop to reach 32,909.59 points.

Meanwhile, the Nasdaq was unchanged at 12,381.30 points. A 3.6% rally was also seen in the S&P 500 energy index, as crude supply prices jumped over the prospect of tight supply.

Individual stocks

There was a 3.8% rise in Macy’s Inc., as the retailer successfully beat profit estimates for the quarter. A 12% surge was also recorded in Palo Alto Networks Inc.

The cybersecurity company reported upbeat quarterly results and also disclosed a plan for splitting its stock.

A 0.7% gain was also recorded in the Philadelphia Semiconductor Index, which brought its losses for the year down by 27%.

Meanwhile, Zoom Video Communications Inc. shed almost 17%, as the former ‘stay-at-home’ sensation reduced its annual revenue and profit forecasts.

There was a greater number of declining stocks within the S&P 500 index, as opposed to rising ones, with the ratio standing at 1.5:1.