Wall Street indexes closed lower on Tuesday as General Electric's sharp decline weighed on major benchmarks, even as retail earnings and optimism about U.S.-China trade talks provided some support. The S&P 500 hovered near a critical 2,800 threshold amid mixed market sentiment.
Shares of General Electric fell 4.7% after the conglomerate warned of a cash outflow from its industrial operations in 2019, dragging down the S&P 500. Meanwhile, consumer discretionary stocks rose 0.2% following strong earnings from Kohl's and Target, which both exceeded profit forecasts.
Investors remained cautious ahead of the S&P 500's 2,800 level, a key psychological barrier that has held for multiple sessions. 'With the market up as much as it is, I don’t think investors are in a rush to commit new capital unless they see clear catalysts,' said Rick Meckler of Cherry Lane Investments.
U.S.-China trade tensions lingered as Secretary of State Mike Pompeo emphasized President Trump's insistence on a 'perfect' deal, though officials continued negotiations. The Federal Reserve's potential policy shift also influenced market dynamics, with the S&P 500 gaining 11% year-to-date on expectations of reduced rate hikes.
The Dow Jones Industrial Average fell 0.05% to 25,806.63, while the Nasdaq Composite declined 0.02% to 7,576.36. Sector performance varied, with communication services leading gains and industrials posting the largest losses. Aon Plc's 7.8% drop weighed on the S&P 500 after its acquisition talks with Willis Towers Watson sparked volatility.
Economic data showed U.S. new home sales hit a seven-month high in December, though November's figures were revised lower. Service sector growth rebounded in February, driven by increased new orders, while overall trading volume remained below recent averages.
