Stocks fall as volatile month comes to close | February 28, 2023

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U.S. stocks fell Tuesday, rounding out the last day of a volatile month of February on Wall Street.

The S&P 500 (^GSPC) edged lower by 0.3%, while the Dow Jones Industrial Average (^DJI) declined 0.7%. The technology-heavy Nasdaq Composite (^IXIC) ticked down by 0.1%.

The yield on the benchmark 10-year U.S. Treasury note ticked up to 3.92% Tuesday afternoon. The U.S. benchmark WTI crude oil moved higher to trade around $76.94 a barrel. The dollar index was up, trading at $104.92.

Stocks closed higher on Monday, fueling a temporary rebound from Wall Street's worst week of the year. All three indexes ended February in the red after an optimistic start to the year in January.

Economic data released on Tuesday showed that retail inventories, excluding auto, rose 0.3%, higher than 0.1% expected by economists surveyed by Bloomberg. Meanwhile, wholesale inventories declined 0.4%, below consensus estimates of 0.1%.

American consumers felt worse about the economy in February, the Confidence Board reported. The board's Consumer Confidence Index slumped to 102.9 from 106.0, below consensus estimates of 108.5, Meanwhile, February Chicago PMI dipped to 43.6 from 44.3, also below consensus expectations.

“Consumers and businesses are looking for ways to reduce expenses in anticipation of much weaker activity over the rest of the year. The drop in consumer confidence in February aligns with weaker business confidence readings as the Fed’s sharp increase in interest rates start to bite," Ben Ayers, Nationwide senior economist, wrote in a statement.

Other data showed that home prices fell 0.5% in December, according to data from S&P Corelogic Case-Shiller Index. On a yearly basis, home prices rose 4.6%, lower than analysts' expectations of 4.8%.

As inflation still remains sticky, Federal Reserve Governor Philip Jefferson on Monday shot down arguments for raising the central bank’s 2% inflation target and said he is under "no illusion" that it's going to be easy to get the inflation rate back down.

This week, investors will remain focused on the retail sector. On Tuesday, earnings from Target (TGT) topped analysts' expectations as consumer spending continues to move away from discretionary categories. The retailer’s same-store sales grew by 0.7%, above estimates of a 1.74% decline. The stock rose about 1% on Tuesday.

Data from Bespoke Investment Group showed that over the last week, 420 stocks have reported earnings and the percentage of companies lowering guidance is more than double the percentage raising guidance, signaling "lots of trouble for these smaller-cap companies that report late in the season."

In other single stock moves, Zoom (ZM) shares rose after the company posted better-than-expected fourth quarter earnings, with earnings per share of $1.22 higher than estimates of 80 cents. Revenue came in at $1.12 billion.

Occidental Petroleum (OXY) shares moved down on Tuesday after the oil and gas producer posted fourth-quarter results that came in below Wall Street expectations on revenue and earnings per share.

Shares of Workday (WDAY) were up after the human-resources software company topped expectations with revenue of $1.65 billion, up 20% year-over-year, against estimates of $1.63 billion.

AMC Entertainment Holdings, Inc. (AMC) fell jumped on Tuesday after a Delaware court said it would hold a hearing on April 27, which will likely delay the date of conversion of convertible units APE to common stock.

Tesla (TSLA) shares fell around 1% as Mexico's president confirmed that the EV maker will build a new plant in Monterrey, Mexico. The Mexican president said more details will be released at Tesla's investor day, and he said the plant is expected to be "very big."

Shares of Coinbase (COIN) surged as fears of crypto regulation begin to fade. On Monday, the company was served a subpoena from the Securities and Exchange Commission as the regulatory agency cracks down on cryptocurrency listings, its custody of digital assets and platform operations, and more, the company disclosed.

Norwegian Cruise Line (NCLH) shares sank after the company reported a wider-than-expected loss and forecasted disappointing guidance for 2023 as the cruise operator gets squeezed by soaring fuel and labor costs.

Separately, Bank of Nova Scotia shares dropped after the Canadian lender reported a missed in earnings estimates as a lull in its investment banking division dented income from its capital markets unit.

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