Wall St kicks off week on dour note; Tesla climbs

By Shubham Batra and Johann M Cherian

(Reuters) -Wall Street’s main indexes fell on Tuesday with investors wary of big bets ahead of remarks by Federal Reserve Chairman Jerome Powell before U.S. Congress, while Tesla (NASDAQ:) climbed after Rivian agreed to adopt its charging standard.

Powell is expected to deliver the semi-annual monetary policy testimony before the U.S. House Financial Services Committee on Wednesday and before the Senate Banking Committee on Thursday.

“Investors are taking a pause and are waiting to see if he(Powell) continues with hawkish comments like he did at the prior Federal Reserve meeting,” said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance.

Barring consumer discretionary, all the other S&P sub-sectors were in the red, with rate-sensitive sectors like real estate and financials down 1.3% and 0.8% respectively.

The and the Nasdaq closed at their highest weekly levels in over a year on Friday. However, the indexes have started on jittery footing this week as recent remarks on the need for tighter monetary policy by Fed officials continued to vex investors.

U.S. single-family homebuilding surged in May to its highest in more than a year and permits issued for future construction also climbed, adding to angst about monetary tightening.

Traders now see a 73% chance of Fed hiking its key benchmark rates by 25 basis points in July, according to CMEGroup’s Fedwatch Tool.

Bucking the trend, Tesla Inc added 2.2% after Reuters reported that Rivian Automotive has agreed to adopt Tesla’s charging standard, adding momentum to the EV giant’s bid to set the industry standard.

At 12:19 p.m. ET, the was down 285.22 points, or 0.83%, at 34,013.90, the S&P 500 was down 27.98 points, or 0.63%, at 4,381.61, and the was down 66.55 points, or 0.49%, at 13,623.02.

Energy and materials were among the most hit sectors tracking weak prices of commodities after China made a smaller-than-expected cut to its benchmark lending rates. [O/R] [MET/L]

Among other movers, PayPal (NASDAQ:) Holdings rose 2.6% after KKR & Co (NYSE:) agreed to purchase up to 40 billion euros ($43.71 billion) worth of the payments firm’s “buy now, pay later” loans in Europe.

Nike (NYSE:) slipped 3.3% after Morgan Stanley (NYSE:) flagged a risk of margin pressure from inventory glut.

U.S.-listed shares of Alibaba (NYSE:) Group slipped 5.0% after the company said Daniel Zhang would step down from his roles as CEO and chairman to focus on the company’s cloud division.

Adobe (NASDAQ:) Inc fell 2.7% following a report that European antitrust regulators were preparing to investigate the firm’s deal to buy cloud-based designer platform Figma.

Dice Therapeutics Inc jumped 37.2% after Eli Lilly (NYSE:) and Co said it would buy the drugmaker in an all-cash deal for about $2.4 billion.

Declining issues outnumbered advancers for a 2.48-to-1 ratio on the NYSE and 1.83-to-1 ratio on the Nasdaq.

The S&P index recorded 11 new 52-week highs and no new lows, while the Nasdaq recorded 49 new highs and 66 new lows.