SPX: S&P 500 Drifts Lower by 0.3% as Red-Hot Rally Pauses for Breath

Stocks lost steam with investors reassessing the way forward just as the S&P 500 is closing in on a solid quarter.

Key Points:

• S&P 500 to log best 1st quarter since 2019.
• Stocks move away from record highs.
• Investors pause buying ahead of PCE data.
• The S&P 500 index drifted to the downside on Tuesday and futures contracts remained under pressure Wednesday as investors folded their long bets ahead of key US data. The Federal Reserve’s preferred inflation measure—PCE—is due for release on Friday when stocks will take a break for Good Friday.
• PCE, or personal consumption expenditures, measures price growth without the more volatile food and energy sectors. For February, the index is expected to show inflation stayed flat from the previous month at a 2.8% rate. A day before that, on Thursday, markets will be parsing the quarterly gross domestic product (GDP) report for the US economy.
• In that context, the S&P 500 is looking to close its best first quarter since 2019. The broad-based equity benchmark is up 9.7% so far into the quarter with just two trading days left. Its two peers are also sitting on solid increases. The Dow Jones Industrial Average is up 4% and the Nasdaq Composite is higher by 10% so far this year.