By Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks edged lower on Wednesday
as investors assessed a larger-than-expected jump in wholesale
prices and mixed earnings reports from Macy's Inc., Deere & Co.
and Plug Power Inc.
Wholesale prices jumped 0.6% in April, the largest increase
since the autumn of 2012. Two months of sharp rises in prices paid
by producers suggest that the era of low inflation in the U.S. may
be ending.
The S&P 500 (SPX) was 3 points, or 0.2%, lower at 1,894.02.
The Dow Jones Industrial Average (DJI) shed 44 points, or 0.3%, to
16,670.30. The Nasdaq Composite (RIXF) fell 7 points, or 0.2%, to
4,122.23.
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action.
"Markets are taking a pause after scaling record levels in the
past few days," says Frank Fantozzi, chief executive officer at
Planned Financial Services, a Cleveland, Ohio-based independent
wealth manager.
"As the economy keeps improving and the Fed keeps interest rates
low, stocks are likely to go higher in 2014, with some volatility
along the way," he added.
The only economic report on the docket was a report on U.S.
wholesale costs. Prices paid by producers jumped in April by most
since the autumn of 2012, rising sharply for the second straight
month. The rise suggests that price pressures might be building a
bit after an extended period of extremely low inflation.
The producer-price index jumped a seasonally adjusted 0.6% last
month, following a revised 0.5% increase in March, the Labor
Department said Wednesday. Economists polled by MarketWatch had
expected a 0.2% increase.
Macy's gains on earnings beat, Plug Power falls
Macy's (M) shares rose 1.7% after the company reported
first-quarter earnings that beat expectations, as sales improved in
April after severe weather hurt business between January and
March.
Shares of Deere & Co. (DE) fell 0.8% after the tractor maker
reported its profit fell 9.5% as sales of equipment fell. It also
predicted a steeper-than-expected decline in equipment sales for
the full fiscal year.
Shares of Plug Power Inc. (PLUGD) reversed a late-session gain
on results and was down 7.8% in early morning trade.
Google Inc. (GOOG) and WellPoint Inc. (WLP) are among the
companies holding annual general meetings on Wednesday.
After the close of regular trading, Dow industrials component
Cisco Systems Inc. (CSCO) is expected to report a slightly lower
profit and lower revenue, with the outlook a key focus for analysts
and investors. Cisco: Revenue to fall again, analysts say
Shares of Take-Two Interactive Software Inc. (TTWO) lost 3.2%
after the videogame publisher projected a wider-than-expected
first-quarter adjusted loss.
Shares of Fossil Group Inc. (FOSL) dropped 7.7% after the
watchmaker provided disappointing projected earnings for the second
quarter. Read: Macy's, Deere, Cisco are stocks to watch
European stocks weaker, gold gains
In overseas markets, European stocks traded weaker. The release
of the Bank of England's May inflation report triggered losses for
the British pound across the board.
In Asia, the Hong Kong Hang Seng Index jumped 1% after China's
central bank told China's top bankers to cut mortgage rates and
take other actions to support the market. Gains in Hong Kong were
led by property firms. China property crash: Economists debate
outlook
In other markets, crude-oil for June delivery (CLM4) rose 59
cents to $102.29 a barrel, while gold for June delivery (GCM4)
gained 0.9% to $1,306.8 an ounce.
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