Shares of industrial and transportation companies fell as trepidation about the energy shock and global tensions offset the impact of strong earnings and factory data.
The Institute for Supply Management's purchasing managers' index was 52.7 in April, in line with March, a slightly more modest expansion than economists had anticipated.
European auto makers were mixed after President Trump said he would raise tariffs on European car imports, in reprisal for what he described as a lack of support for the Iran war. Shares of German auto giant Volkswagen Group fell slightly.
Should oil futures remain elevated, most economists anticipate rising inflation later this year.
One brokerage said the impact of AI on the U.S. labor market may be more inflationary than commonly assumed. "Signs of life in high-frequency U.S. labor data suggest to us that downside risks to the unemployment rate may be underappreciated," said economists at brokerage BNP Paribas, in a note to clients. "This brings with it a growing tail risk that the Fed could consider hiking rates later this year. Our work on AI posits that the technology's net effect can lower the unemployment rate over the near term, not raise it, counter to some more pessimistic narratives."
Write to Rob Curran at rob.curran@dowjones.com
(END) Dow Jones Newswires
05-01-26 1737ET
