US stocks slip, with investors focused on rates outlook

The Dow Jones Industrial Average closed the session 230 points lower, the S&P 500 dropped 0.4%, and the tech-heavy Nasdaq closed marginally lower

US stocks slipped on Tuesday, with investors still focused on the path of interest rates after a lacklustre start to earnings season that kicked off with big bank results.

Boeing dragged on the Dow Jones Industrial Average (DJIA), which closed the session 230 points lower, while the S&P 500 inched down 0.4%. The tech-heavy Nasdaq closed marginally lower despite flipping into green territory several times during trading as chipmakers Nvidia and Advanced Micro Devices gained.

Goldman Sachs (GS) stock closed slightly up after the bank reported a fourth quarter earnings jump of 51% year over year. Goldman Sachs said its full-year net income of $8.52 billion for 2023 was 24% lower as dealmaking slowed across the industry.

Morgan Stanley (MS) shares slipped as much as 4% during the session after posting a quarterly profit impacted by a one-time charge of $535 million. The bank's fourth quarter revenue beat Wall Street expectations.

Investors are counting down to Wednesday's retail sales report as they track each release that could impact the Federal Reserve's data-driven policy thinking. Last week's surprise cooling in US wholesale inflation raised hopes for an interest rate reduction in March.

Fed Governor Chris Waller said on Tuesday he believes the Federal Reserve will be able to reduce interest rates this year so long as inflation does not bounce back or stay higher. However, he cautioned the timing and rate cuts will depend on incoming data.

In other corporate news, a federal judge blocked a merger deal between Spirit Airlines and JetBlue amid antitrust concerns. The tie-up between the two airlines would have created the fifth-biggest airline in the US.