Wall Street closes down with signs of slowing down the US economy

Othe final results of the session indicate that the selective index Dow Jones dropped 0.20%, to 53,732.41 points, the technological Nasdaq declined 0.28% to 26,729.16 points and the S&P 500, more comprehensive, dropped 0.17%, closing at 7,785.76 points.

The shares cancelled the modest gains of early morning after rising oil prices. The price of the Brent oil barrel rose by 1.7% to $88.52, given the uncertainty about the resumption of oil exports by sea in the Persian Gulf.

Official statistics released today showed that consumers spent less on American retail last month than the previous month. These figures surprised economists, who expected another month of growth, and contribute to keeping interest rates low, but also increase the risk of economic slowdown.

Inflation remains well above desired, but the reports released earlier this week suggested that the rate of price rise is slowing down. If inflation continues in this trend, it may encourage the Federal Reserve (Fed) to postpone interest rate increases.

The Fed does not have an effective tool to correct both a stagnant economy and high inflation, which is why the so-called ‘stagflation’ is seen as the worst possible scenario.

Some Wall Street analysts, however, warned of the risk of exaggerated reactions to weak retail sales data in the world's largest economy.

Jennifer Timmerman, Senior Investment Strategy Analyst at Wells Fargo Investment Institute, stated that data may reflect only a stabilization after the previous months by atypical factors in the US economy, such as large tax refunds, the Football World Cup and even an online retailer Amazon event.

However, US consumers seem to be increasingly pessimistic about the economy. A preliminary survey from the University of Michigan suggested that the feeling is deteriorating more than the economists predicted.

Among the quotes, Reddit rose today 12.6% after the news that it was going to join the S&P 500 index on Tuesday.

The shares of AI companies in general have shown oscillations, accentuated due to concerns that their prices have skyrocketed due to euphoria around AI and that strong revenue growth may not be sustainable.

In the bond market, income from US Treasury bonds rose slightly, following the price of oil.

The yield of the 10-year Treasury bond rose to 4.69%, compared to 4.63% at the end of Thursday.