Reuters

(Reuters)

Wall Street Snaps Three-Day Win Streak, Wal-Mart Drags

By Markets FOXBusiness

U.S. equity markets capped a muted session lower as traders focused on how global-growth worries are likely to impact the Federal Reserve’s decision on hiking short-term rates.

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The  Dow Jones Industrial Average was 32 points lower, or 0.18% to 17512. The S&P 500 declined 5 points, or 0.26% to 2096, while the Nasdaq Composite paced 32 points lower, or 0.64% to 5059.

The consumer discretionary sector was the only one of ten S&P 500 sectors to end in positive territory, gaining 0.48% on the session.

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Wall Street followed European markets mostly lower as traders there continued to worry about the effects of Greece’s long-term debt problems ahead of its Thursday debt-repayment deadline, and China’s economic future.

David Madden, IG market analyst, said in a note all the speculation among traders that China will loosen lending policies in an effort to kick start business activity is doing more harm than good.

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“It sends out the message that [China’s] economy is in dire need of stimulus, and that’s driving dealers towards the door,” he said. “All the news out of China recently has done nothing to restore confidence in its financial markets, and the ripple effect can be felt in Europe.”

Overnight, Chinese markets saw another session of steep declines, the most since mid-July. The Shanghai Composite plunged 6.15%, erasing all of last week’s gains after the surprise yuan devaluation.

Elsewhere, Hong Kong’s Hang Seng dropped 1.43%. Japan’s Nikkei, however, declined 0.32%.

Meanwhile, European markets were mostly flat in recent action. The Euro Stoxx 50, which tracks large-cap names in the eurozone, drifted  0.16% higher. The German Dax slipped 0.10%, the French CAC was unchanged, while the UK’s FTSE 100 fell 0.21%.

Back in the U.S., traders continued to keep a keen eye on economic data ahead of Wednesday’s release of the Federal Reserve’s latest meeting minutes. Wall Street will look for any clues as to w

Elsewhere, Hong Kong’s Hang Seng dropped 1.43%. Japan’s Nikkei, however, declined 0.32%.

Meanwhile, European markets were mostly flat in recent action. The Euro Stoxx 50, which tracks large-cap names in the eurozone, drifted  0.16% higher. The German Dax slipped 0.10%, the French CAC was unchanged, while the UK’s FTSE 100 fell 0.21%.

Back in the U.S., traders continued to keep a keen eye on economic data ahead of Wednesday’s release of the Federal Reserve’s latest meeting minutes. Wall Street will look for any clues as to whether the central bank intends to begin hiking short-term interest rates at its September meeting. Some on the Street have speculated about whether the global growth concerns as a result of recent trouble in China will stave off a rate hike until later in the year.

On Tuesday, though, traders unwrapped the latest figures on the housing market with housing starts and building permits data. The Commerce Department reported a 0.2% pick-up in new single-family home construction, to an annualized rate of 1.21 million units. That topped economists’ forecast for an increase to 1.19 million units. Building permits, however, plunged 16.3% for the month to an annualized rate of 1.11 million units. The reading was far below expectations for a shallower drop to 1.23 million units.

“The stronger-than-expected gain in single-family starts for July implies a stronger Q3 profile for single-family construction spending,” Barclays economists noted on Tuesday. “Single-family construction accounts for about 35% of total residential investment. Thus, stronger starts and construction boosted our estimate of residential investment and added 0.1 percentage point to our Q3 GDP tracking estimate, bringing it up to 2.7%.”

On the corporate news front, second-quarter earnings results from two major retailers were out ahead of the bell.

Wal-Mart (WMT) missed quarterly estimates as it also announced it lowered its full-year forecast. The news sent the big-box retailer’s shares declined nearly 3% in recent action.  

Home Depot (HD), meanwhile posted quarterly earnings that topped expectations, while revenue came in just under views. The home-improvement giant, however, again lifted its full-year outlook  as the company said the housing recovery in America helped drive better sales growth than it expected in the most recent quarter.

Sprint (S) said it will no longer offer two-year phone contracts as it looks to better compete with rivals T-Mobile (TMUS), and Verizon (VZ), which announced earlier this month it will discontinue the use of contracts. Sprint will now shift to a model in which customers will lease their smartphones, a method the company said 51% of its customers already use.

In commodities, global oil prices were mixed. U.S. crude prices rose 1.65% to $42.57 a barrel, while Brent, the international benchmark, slid 0.04% to $48.78 a barrel.

Gold was also lower, falling 0.18% to $1,116 a troy ounce, while copper declined 1.62% to $2.28 a pound.

The euro fell 0.47% against the U.S. dollar, while the yield on the U.S. 10-year Treasury yield rose 0.025 of a percentage point to 2.177%.