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US markets end lower on lingering concerns about inflation

18 May 2021 Evaluate

The US markets ended lower on Monday on lingering concerns about inflation and the outlook for monetary policy weighed on Wall Street ahead of the release of the minutes of the Federal Reserve's latest monetary policy meeting on Wednesday. Traders are likely to closely analyze the Fed minutes for indications officials are growing concerned about the recent acceleration in inflation and considering tapering asset purchases. The Fed has repeatedly signaled that it believes the increase in inflation largely reflects transitory factors, although the spike in consumer prices reported by the Labor Department last week still helped trigger a sell-off on Wall Street.

On the economic data front, the Federal Reserve Bank of New York released a report showing its index of regional manufacturing activity pulled back modestly in May after jumping to a more than three-year high in the previous month. The New York Fed said its general business conditions index dipped to 24.3 in May from 26.3 in April, although a positive reading still indicates growth in regional manufacturing activity. Street had expected the index to slip to 23.9 after reaching its highest level since October of 2017 in the previous month. Meanwhile, the National Association of Home Builders released a separate report showing homebuilder confidence in the US held stable in the month of May. The report showed the NAHB/Wells Fargo Housing Market Index came in at 83 in May, unchanged from April. The unchanged reading matched street estimates.

Dow Jones Industrial Average fell 54.34 points or 0.16 percent to 34,327.79, Nasdaq dropped 50.93 points or 0.38 percent to 13,379.05 and S&P 500 was down by 10.56 points or 0.25 percent to 4,163.29.

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