US close: Markets flat as deficit fears cap risk appetite
By Benjamin Chiou
Date: Thursday 22 May 2025
(Sharecast News) - US stock markets were more or less unchanged on Thursday as concerns about the government's fiscal outlook held back risk appetite after the US House Of Representatives approved Donald Trump's tax reform and reduction bill by the narrowest margins.
News that economic bellwether Nike and luxury fashion group Ralph Lauren would be raising prices due to tariffs also weighed on sentiment.
The Dow finished flat, the S&P 500 edged 0.04% lower, while the Nasdaq gained 0.28%.
"Wall Street failed to lift wider investor spirits on opening as markets wrestled with mixed earnings updates and further warnings of price hikes," said AJ Bell head of financial analysis Danni Hewson.
"The narrow passage through The House of Donald Trump's 'big, beautiful' tax bill has also left some investors uneasy about the current US debt burden and what may happen next."
Markets fell sharply the previous session - indices recorded their steepest decline in a month - after softer-than-expected demand in a $16bn auction of 20-year bonds saw the coupon rate (5.047%) rise to its highest since 2020 when the maturity was reintroduced.
The weak auction comes amid mounting fears about the US government deficit with massive tax cuts put forward by the president widely expected to make matters worse. Meanwhile, last Friday's decision by Moody's to cut the US credit rating from the highest rating Aaa to Aa1 was also weighing on sentiment.
The yield on a 10-year US Treasury was down 7.1 basis points at 4.534%, but surged as high as 4.632% earlier on, hitting levels not seen since January.
Nike and Ralph Lauren to raise prices
Nike shares rose after the sports apparel and footwear giant announced plans to start selling on Amazon after a six-year hiatus. The company also said it would have to increase prices, saying: "We regularly evaluate our business and make pricing adjustments as part of our seasonal planning."
"Nike might not have poked the Presidential Bear by referring directly to tariffs when it announced it was raising prices on many of its goods sold in the US, but most people are joining the dots on their own," AJ Bell's Hewson said.
Ralph Lauren also said it would be hiking prices more than previously expected as it attempts to offset the impact of tariffs. However the stock rose strongly after first-quarter results smashed expectations.
Discount retailer Ross Stores fell after withdrawing its sales and profit guidance due to tariff uncertainty, with the company seeing a slower start to its first quarter.
Jobless claims fall, PMIs rise
In economic news, initial unemployment claims drifted 2,000 lower over the week ended 17 May to settle at 227,000, according to the Department of Labor, slightly below the consensus estimate of 230,000.
S&P Global's flash composite output index for factory and services sector activity in May surprised to the upside, coming in at 51.2, after a reading of 50.6 in April, with both sectors showing stronger-than-expected growth.
Existing home sales on the other hand undershot forecasts, coming in at annual pace of 4.0m in April, with analysts expecting no change from March's reading of 4.1m.
Dow Jones - Risers
Nike Inc. (NKE) $61.32 2.23%
Merck & Co. Inc. (MRK) $77.81 1.12%
Goldman Sachs Group Inc. (GS) $597.63 0.80%
Caterpillar Inc. (CAT) $345.14 0.78%
Walt Disney Co. (DIS) $111.14 0.61%
Walgreens Boots Alliance, Inc. (WBA) $11.24 0.54%
Microsoft Corp. (MSFT) $454.86 0.51%
American Express Co. (AXP) $287.07 0.41%
Salesforce.Com Inc. (CRM) $283.42 0.40%
3M Co. (MMM) $149.75 0.25%
Dow Jones - Fallers
Unitedhealth Group Inc. (UNH) $296.67 -2.08%
Verizon Communications Inc. (VZ) $43.11 -1.42%
Home Depot Inc. (HD) $366.13 -1.27%
Coca-Cola Co. (KO) $71.14 -0.99%
International Business Machines Corporation (CDI) (IBM) $258.37 -0.96%
Intel Corp. (INTC) $20.55 -0.68%
McDonald's Corp. (MCD) $314.29 -0.67%
Walmart Inc. (WMT) $95.92 -0.52%
Johnson & Johnson (JNJ) $152.61 -0.37%
Apple Inc. (AAPL) $201.36 -0.36%
S&P 500 - Risers
Advance Auto Parts (AAP) $49.17 57.04%
Gap Inc. (GAP) $28.89 5.02%
Nektar Therapeutics (NKTR) $0.66 4.35%
Seagate Technology Plc (STX) $108.86 4.24%
Kohls Corp. (KSS) $8.11 3.84%
United Airlines Holdings Inc (UAL) $76.00 3.64%
L3Harris Technologies Inc. (LHX) $239.49 2.84%
Dxc Technology Company (DXC) $15.23 2.78%
Helmerich & Payne Inc. (HP) $15.62 2.70%
Albemarle Corp. (ALB) $58.03 2.66%
S&P 500 - Fallers
Humana Inc. (HUM) $227.14 -7.58%
NextEra Energy Inc. (NEE) $66.94 -6.43%
AES Corp. (AES) $9.63 -4.94%
Analog Devices Inc. (ADI) $211.93 -4.63%
Centene Corp. (CNC) $58.07 -4.40%
Medtronic Plc (MDT) $80.91 -4.15%
Elevance Health Inc. (ELV) $383.87 -3.90%
FMC Corp. (FMC) $38.06 -3.13%
Quanta Services Inc. (PWR) $330.57 -3.05%
CVS Health Corp (CVS) $60.19 -3.04%
Nasdaq 100 - Risers
Seagate Technology Plc (STX) $108.86 4.24%
Tesla Inc (TSLA) $341.04 1.92%
Check Point Software Technologies Ltd. (CHKP) $224.86 1.77%
Illumina Inc. (ILMN) $80.54 1.47%
Ulta Salon, Cosmetics & Fragrance Inc. (ULTA) $410.59 1.44%
American Airlines Group (AAL) $11.40 1.42%
Alphabet Inc. Class A (GOOGL) $170.87 1.37%
Workday, Inc. (WDAY) $272.07 1.31%
Starbucks Corp. (SBUX) $83.97 1.19%
Dollar Tree Inc (DLTR) $89.97 1.18%
Nasdaq 100 - Fallers
Analog Devices Inc. (ADI) $211.93 -4.63%
Texas Instruments Inc (TXN) $180.21 -2.81%
QUALCOMM Inc. (QCOM) $147.37 -2.60%
Electronic Arts Inc. (EA) $146.63 -2.57%
Microchip Technology Inc. (MCHP) $58.05 -2.03%
Trip.com Group Limited (TCOM) $61.06 -1.91%
Liberty Global plc Series C (LBTYK) $9.88 -1.69%
Baidu Inc. (BIDU) $84.07 -1.65%
KLA-Tencor Corp. (KLAC) $767.51 -1.47%
Comcast Corp. (CMCSA) $34.59 -1.45%
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