The U.S. stock market declined on Tuesday because of increasing oil prices combined with disappointing retail sales figures which raised doubts about economic stability. The S&P 500 index decreased by 0.3% during midday trading and the Dow Jones dropped 39 points which represents a 0.1% decline while the Nasdaq lost 0.3% of its value.
The market experienced a decline after May retail sales figures exceeded expectations which raised doubts about the sustainability of consumer spending as the main economic support. Some of the decline resulted from customers making purchases before April auto tariffs took effect.
Investors maintained a state of high alert because of the intensifying conflict between Israel and Iran. The conflict between Israel and Iran caused oil prices to increase by 2.3% which brought West Texas Intermediate crude to $73.39 per barrel.
The weak economic data caused Treasury yields to decrease which indicates investors will exercise caution before the Federal Reserve announces its policy decision. The Federal Reserve maintains its expectation to keep interest rates unchanged but continues to monitor economic indicators for signs of weakness.
The overall market stability remains intact yet strategists predict investors will start reducing their exposure because of geopolitical threats and changing consumer patterns.
