US: Stocks drop on worries about consumers, debt ceiling talks

WALL Street stocks fell Tuesday (May 16) following a downcast earnings report from Home Depot, as markets eyed pivotal negotiations on lifting the US debt ceiling.

Shares of Home Depot slid 2.2 per cent, weighing on the Dow, after the home improvement retailer reported a drop in quarterly sales and cut its 2023 forecast.

The report added to concerns about the health of the US consumer.

“The housing market boomed and then crashed and what is happening with Home Depot could be a warning of what will come to the broader retail space,” said Oanda’s Edward Moya.

The Dow Jones Industrial Average fell 1.0 per cent to 33,012.14.

The broad-based S&P 500 shed 0.6 per cent to 4,109.90, while the tech-rich Nasdaq Composite Index dipped 0.2 per cent to 12,343.05.

Hard-hit sectors included energy and materials, but large technology companies such as Amazon and Google parent Alphabet advanced.

Markets were watching for talks between President Joe Biden and House Republican leaders to avert a US debt default.

Biden has shortened an upcoming trip to Asia in light of the unresolved talks, according to two sources.

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Among other companies, Horizon Therapeutics fell 14.2 per cent after the Federal Trade Commission sued to block its proposed US$28 billion takeover by Amgen. Amgen dropped 2.4 percent. AFP