DOW JONES INDUSTRIAL AVERAGE GIVES UP RECENT GAINS, SHEDS 300 POINTS ON TUESDAY

Dow Jones backslides as other indexes gain ground.

DJIA gets dragged down by steep declines in large caps.

US data softened slightly on Tuesday, but not enough to appease rate cut hopes.

The Dow Jones Industrial Average (DJIA) shed weight on Tuesday, declining around 300 points as heavy-hitters like Home Depot Inc. (HD) and Walmart Inc. (WMT) dragged the large-industry index into the red. US equities are gaining ground in a lop-sided index performance, with losses concentrated in key securities on the Dow Jones.

The CB Consumer Confidence survey index declined to 100.4 in June, down from the previous print of 102.0 but falling just short of the expected decline to 100.0. The Richmond Fed’s Manufacturing Index dropped sharply to -10.0 in June, far below the forecast increase to 2.0 from the previous 0.0.

Financial markets broadly hopeful for softly-weakening economic figures from the US will be pivoting to watch for US Durable Goods, Gross Domestic Product (GDP), and Personal Consumption Expenditure Price Index (PCE) inflation figures all slated for release in the back half of the trading week beginning on Thursday. Tuesday’s mid-tier releases weren’t enough to spark firm market flows in either direction.

According to the CME’s FedWatch Tool, rate markets continue to price in around 66% odds of at least a quarter-point rate cut from the Federal Reserve (Fed) in September. Rate-cut-hungry investors are running out of room to hope that a downturn in US economic figures will spark an early rate cut from the Federal Open Market Committee (FOMC), while a too-sharp drop in US economic activity could spark a broad risk-off flight into safe havens like the US Dollar. On the other hand, a resurgence in US economic activity would likewise spoil investor sentiment, as rate cut hopes hinge on a slow trudge into a soft-landing recession within the US’ domestic economy