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US business activity rises to 11-month high in April
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Procter & Gamble gains on upbeat sales forecast
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SQM, Albemarle fall as Chile to nationalize lithium industry
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Indexes down: Dow 0.15%, S&P 0.12%, Nasdaq 0.06%
April 21 (Reuters) - Wall Street's main indexes slipped on Friday as investors digested a mixed bag of earnings reports, while uncertainty around the outlook for U.S. interest rates and the economy kept them on edge.
A survey showed U.S. business activity accelerated to an 11-month high in April, at odds with growing signs that the economy was in danger of slipping into a recession as higher interest rates cool demand, further clouding the outlook for the Federal Reserve's monetary policy.
U.S. Treasury yields rose following the survey, weighing on major technology and growth stocks such as Apple Inc, Meta Platforms Inc and Microsoft Corp, down between 0.2% and 0.9%.
Amazon.com Inc bucked the trend with a 3.3% gain, aiding a 1% advance in consumer discretionary stocks.
Procter & Gamble Co climbed 3.6% after the consumer company raised its full-year sales forecast on higher pricing.
HCA Healthcare Inc jumped 5.4% as the hospital operator lifted its forecasts for 2023, sending shares of peers Tenet Healthcare Corp, Community Health Systems, Universal Health Services Inc up between 3.5% and 14%.
Meanwhile, U.S.-listed shares of Chilean lithium miner SQM tumbled 10.1% after Chile unveiled plans to nationalize its lithium industry, transferring control of its vast operations from industry giants to a separate state-owned company.
A 6.3% slide in U.S. lithium miner Albemarle Corp, coupled with a 4.9% drop in Freeport-McMoRan Inc after the copper miner reported its first-quarter profit more than halved, pulled the materials sector down 1.2%.
"There's still probably a lot of room for earnings to decline," said Joshua Chastant, senior investment analyst at GuideStone Funds.
"We think that maybe the market is not quite ready for that or it's not priced in. Multiples are still at 18 times earnings. There is lots of excess in equity markets that needs to be unwound."
U.S. stock indexes have been rangebound this week with investors seeking clues on how far the Fed could hike interest rates, while earnings have signaled resilience in big banks though most regional lenders reported deposit outflows in the wake of a banking crisis last month.
A slate of Fed speakers this week voiced support for another 25-basis-point rate hike by the U.S. central bank at its May 2-3 meeting. Traders have priced in an 82% chance of such a move, with many expecting the Fed to hold rates before cutting them by the end of 2023.
Fed Board Governor Lisa Cook is set to take the stage on Friday before the central bank's policymakers enter a blackout period until the next policy meeting.
At 11:39 a.m. ET, the Dow Jones Industrial Average was down 51.39 points, or 0.15%, at 33,735.23, the S&P 500 was down 5.02 points, or 0.12%, at 4,124.77, and the Nasdaq Composite was down 6.65 points, or 0.06%, at 12,052.91.
Tesla Inc gained 0.7% after raising U.S. prices for its Model S and X premium electric vehicles.
Declining issues outnumbered advancers by a 1.74-to-1 ratio on the NYSE and a 1.37-to-1 ratio on the Nasdaq.
The S&P index recorded 18 new 52-week highs and four new lows, while the Nasdaq recorded 37 new highs and 128 new lows. (Reporting by Sruthi Shankar, Ankika Biswas and Vansh Agarwal in Bengaluru Editing by Vinay Dwivedi)
