U.S. Stocks Losing Ground Amid Profit Taking, Fading Peace Talks Hopes

U.S. stocks are languishing in negative territory in mid-afternoon trade on Wednesday and look set to end the session on a weak note, amid fading hopes about Russia-Ukraine ceasefire talks following Russia’s continued attack on certain areas in Ukraine.

Profit taking after two successive days of solid gains contribute as well to market’s decline.

Investors are also digesting the latest batch of economic data, including a report on U.S. GDP growth.

The major averages are all down in the red, with the tech-laden Nasdaq index posting a more pronounced loss.

The Dow is down 109.37 points or 0.31 percent at 35,184.82. The S&P 500 is lower by 29.70 points or 0.65% at 4601.90. The Nasdaq is down 141.88 or 0.97 percent at 14,477.76.

A report released by payroll processor ADP showed private sector employment in the U.S. jumped by 455,000 jobs in March after surging by an upwardly revised 486,000 jobs in February. Economists had expected private sector employment to climb by 450,000 jobs compared to the addition of 475,000 jobs originally reported for the previous month.

Data released by the Commerce Department showed the U.S. economy grew by slightly less than previously estimated in the fourth quarter of 2021.

The Commerce Department said real gross domestic product increased by 6.9% in the fourth quarter, reflecting a modest downward revision from the previously estimated 7% spike. Economists had expected GDP growth to be unrevised.

Home Depot shares are down more than 3 percent. Salesforce.com is down nearly 3 percent. Visa, Goldman Sachs, Walt Disney, Intel and JP Morgan Chase are also notably lower.

Walmart, United Health and Boeing are up 1.2 to 1.8 percent. Johnson & Johnson, Travelers Companies, Cisco Systems, Amgen and Merck are also up with solid gains.

Lululemon Athletica Inc shares are up nearly 12 percent after the company forecast full-year profit and revenue above estimates, as demand for athletic wear remains strong.

In overseas trading, Asian stocks ended higher on Wednesday amid optimism around a peaceful resolution of the Ukraine war after Russia promised to scale down military operations around Ukraine’s capital Kyiv, while Ukraine proposed adopting a neutral status in face-to-face negotiations.

European stocks closed weak amid doubts about Russia’s promise to scale down military operations. Ukraine is skeptical about Russia’s promise, and the U.S. has warned the threat is not over and that Russia’s announcement could be an attempt to buy time to continue its assault.