US STOCKS-S&P 500, Dow slip as Cisco drags, Nasdaq steady after selloff
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* Kohl's falls on full-year forecast cut
* Canada Goose jumps on upbeat profit outlook
* Indexes: Dow off 0.89%, S&P slips 0.42%, Nasdaq up 0.26% (Updates to open)
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Shares of the networking gear maker slumped 12.7%
as it lowered 2022 revenue growth outlook, taking a hit from
Kohl's Corp slipped 1.1% after the department store chain cut its full-year profit forecast, the latest U.S. retailer to flag a hit from four-decades high inflation.
The S&P consumer staples index fell 1.9% to hit a seven-month low and was the biggest decliner among the 11 major sectors as retail firms face the brunt of rising prices hurting the purchasing power of U.S. consumers.
"The consumer component is now starting to weaken, which
bolsters the perspective that we are indeed heading into a
recession," said
Consumer spending accounts for more than two-thirds of U.S. economic activity.
In the previous session, the S&P 500 and the Nasdaq closed down more than 4% as growth stocks sank and retailer Target Corp (TGT) posted weak results.
The benchmark index is down 18.6% from its record close on
Rate-sensitive growth have led the selloff this year as investors adjust to tightening financial conditions with the U.S. Federal Reserve raising rates.
"The central worry facing investors right now is how the
Federal Reserve will or will not be able to tame inflation
without causing a recession,"
"Investors should become accustomed to significant downside and upside moves in stocks, which is common during times of tremendous uncertainty."
Goldman Sachs strategists predicted a 35% chance of the U.S. economy entering a recession in the next two years, while Wells Fargo Investment Institute expects a mild U.S. recession at the end of 2022 and early 2023.
The Labor Department's report showed weekly jobless claims unexpectedly rose last week, while a separate data from the Philadelphia Fed showed its business conditions index dropped to a reading of 2.6 in May from 17.6 in April.
At
The battered Nasdaq Composite, however, edged 0.26% higher to 11,447.30, boosted by megacap tech and growth shares such as Alphabet Inc, Microsoft Corp (MSFT) and Amazon.com (AMZN).
The CBOE volatility index, also known as
Canada Goose Holdings Inc jumped 5.3% after it forecast upbeat annual earnings, encouraged by strong demand for its luxury parkas and jackets.
Declining issues outnumbered advancers for a 1.23-to-1 ratio on the NYSE. Advancing issues outnumbered decliners by a 1.08-to-1 ratio on the Nasdaq.
The S&P index recorded one new 52-week high and 42 new lows,
while the Nasdaq recorded four new highs and 257 new lows.
(Reporting by