Stocks close lower Tuesday, Dow and S&P 500 snap four-day win streaks as economic worries loom: Live updates

The three major averages fell on Tuesday.

The S&P 500 shed 0.58% to close at 4,100.60, and the Dow Jones Industrial Average fell 198.77 points, or 0.59%, to close at 33,402.38. The two indexes snapped four-day win streaks.

The Nasdaq Composite slipped 0.52% to end the day at 12,126.33.

-Darla Mercado

Morgan Stanley expects the retail media advertising market to hit $130 billion by 2025, and these stocks stand to benefit the most.

In a note to clients Tuesday, analyst Matthew Cost called advertising tech companies Trade Desk and Criteo the biggest beneficiaries of the growing market, and names that should prosper from a drive by retailers to harness consumer data and create online ads.

"If TTD and CRTO are able to launch increasingly effective tools and work with retailers to prove out the efficacy (and data security) of their retail media solutions, we believe it would position both companies to deliver better than expected results," he wrote.

While Amazon remains and early leader in the space, Cost predicts a roughly $12 billion opportunity for service retailers like Target and Walmart to scale up product promotion tools and launch campaigns over the next few years. Many of these names, he noted, are already partnering with advertising tech companies.

Software stocks like Snowflake also stand to gain from this burgeoning advertising market, benefitting from "demand for their data clean room and identity solutions" that can increase efficiency and data sharing between brands and retailers.

— Samantha Subin

Industrial stocks weighed down the S&P 500 in Tuesday's session.

The sector was the worst of the broad index's 11 with a drop of 2.1%. By comparison, the S&P 500 was down around 0.6%.

United Rentals and Generac dragged on the sector with drops of more than 7% and 6%, respectively. Caterpillar, which is also a member of the Dow, was among the worst performers in the sector as well with a 5% slide.

Seven of the 11 sectors joined industrials in the red for the session. Utilities (up 0.4%), health care (up 0.2%) and communication services (up 0.1%) were the three able to buck the downtrend.

— Alex Harring

Piper Sandler said it's feeling more cautious about apparel retail stocks after talking with Gen Z about their spending plans in its latest teen survey. The firm called out three stocks where it advises investors to tread carefully: Revolve, Lulu's and AKA Brands, which owns the Princess Polly brand.

Those polled by Piper reported that they expected to spend an average of $2,419 this year, up 2% from responses in spring 2022, and 4% higher than in the fall. But it's the guys who are bumping up Gen Z's spending plans, the firm said.

Upper-income males expect their spending to rise 6% from last year and climb 1% from the fall, but females of all incomes are predicting a 1% gain year over year and a 6% decline from the fall.

Notably, this is the first time females showed a decline in wallet share since fall 2019, Piper Sandler said.

Teen girls are looking to spend more on accessories versus a year ago, but clothing purchases will stay flat with last year's levels. The purse strings are getting tighter for footwear purchases, however, with projected spending in the category falling 5% from last spring.

The trends are more stark among upper-income teen girls, where total spending is expected to drop 3%. Upper-income Gen Z girls are budgeting 25% more for accessories than they did in the fall, but the apparel budget shrank 5% and footwear is off 8% over the same time period.

Even with the overall gain, spending among teenagers remains significantly below its fall 2006 peak, when those polled estimated annual spending of $3,023 a year.

—Christina Cheddar Berk

JPMorgan upgraded insurance company Prudential Financial on Tuesday to overweight from neutral, citing its "superior business mix," strong balance sheet and significant underperformance. The stock was recently down 0.5%, but has recently pushed into the green after dropping more than 17.5% this year.

The firm said that while its long-term outlook on the life insurance sector remains negative, it is more confident in stocks buoyed by expected healthy near-term results, a strong equity market and pullback in valuation levels. "We are incrementally upbeat on firms with a lower-risk liability profile and with strong balance sheets," equity analyst Jimmy S. Bhullar wrote in a recent note to clients.

In addition to Prudential, JPMorgan raised its full-year estimates for life insurance companies including American Equity Investment Life Holding, Aflac, Equitable Holdings, MetLife and Voya Financial. The firm said it expects these companies to benefit from a weaker dollar and an increased value from buybacks given lower stock prices.

Bhullar named Voya Financial as the top pick in the sector, given the JPMorgan's positive outlook for business trends associated with the company and Voya's depressed valuation. The stock is up 15.7% so far this year.

— Pia Singh

Top Wall Street strategist Marko Kolanovic said the recently rally in stocks was merely a dead cat bounce as there has been no material improvement in fundamentals.

"For a rational investor, we think this makes little sense and that most of the inflows over the past 2 weeks were driven by systematic investors, short squeeze and a decline in VIX," Kolanovic, JPMorgan's chief global markets strategist, said in a note Monday.

The widely followed strategist said he expects a reversal in risk sentiment and the market re-testing last year's low over the coming months.

— Yun Li

Gold futures were higher on Tuesday, gaining nearly 2% after hitting its highest level since March of 2022.

Bullion reached a session high of $2,043 per ounce is on track for its fifth positive session out of the last six. Gold flew past $2,000 per ounce after bond yields fell on news of weaker than expected available jobs data from the Labor Department.

So far this year, gold prices have gained 11.6%. The precious metal is often touted as a hedge against inflation.

— Brian Evans, Nick Wells

The common stock of theater chain AMC dropped about 20% after the company announced a settlement deal with a group of shareholders that could pave the way for further capital raises.

Under the terms of the deal, the company would get to increase its number of authorized shares, there would a 10-to-1 reverse stock split, and the preferred APE shares would get converted into common stock. In exchange, the suing group of shareholders would receive additional common stock. The shareholders attorneys said in a statement the shares would be valued at more than $100 million at recent market prices.

The APE preferred shares rose 8% following the news.

The settlement should help the cash-strapped theater chain bulk up its balance sheet. The deal could allow to AMC to raise up to $16 billion of equity, one Wall Street analyst told Reuters.

— Jesse Pound

Although environmental issues are very much top of mind for many teens, they likely don't see plant-based meat as a solution, according to the latest Piper Sandler teen survey.

The firm surveys teens twice a year, and has for more than 20 years. The latest edition, which polled 5,690 teens between Feb. 13 and March 21, found Impossible is the preferred plant-based brand among teens with a 39% preference. Beyond Meat had a 34% preference. That said, only 14% of teens are eating meat alternatives, and within that group 25% reported that they planned to eat less of these products over the next year. Piper Sandler said that was an acceleration of the number of teens planning to reduce their consumption of meat alternatives from both their fall 2022 and spring 2022 surveys.

Beyond Meat shares remain far below their 52-week high of $51.98, but the stock has been gaining ground since the start of the year, with shares up nearly 33% since Jan. 1. The stock was unchanged in trading early Tuesday at $16.34.

Both Impossible and Beyond Meat have pitched their products as healthier for the environment.

—Christina Cheddar Berk

Billionaire investor Ken Griffin's flagship hedge fund posted a small gain in March despite the banking crisis, according to a person familiar with the returns.

Citadel's multi-strategy flagship Wellington fund gained 1.4% last month, bringing its 2023 performance to 4.2% through March, the person said. The hedge fund has slightly underperformed the S&P 500, which gained 3.5% in March and more than 7% year to date.

Griffin's hedge fund scored a stellar year in 2022 with a 38% return, marking the firm's best year ever.

— Yun Li

Bank earnings season is right around the corner, and the reports are likely to reinforce the narrative that the biggest banks are the winners of regional banking crisis that hit the U.S. last month, according to Wells Fargo analyst Mike Mayo.

"The change in regulation for them is not so much, and they have benefitted from an inflow of deposits. And by the way, credit quality is still good," Mayo said on "Squawk on the Street."

First quarter earnings reports could show 10% year over year earnings growth for the large banks, and could spur a return of "greed" among investors for bank stocks, Mayo said.

He added that increased fees to the FDIC to pay for the collapse of the smaller banks would not make a major impact on future profits.

— Jesse Pound

Job openings plunged in February in a sign that the ultra-tight labor market may be loosening up.

Available positions fell to 9.93 million for the month, down more than 600,000 from January and well below the FactSet estimate of 10.4 million, according to a Labor Department report Tuesday.

The decline marked the first time openings were below 10 million since May 2021.

Separations and hires also both moved lower though quits rose to just over 4 million.

—Jeff Cox

Costco's status as a defensive stock with some growth upside is being put to the test in recent months, according to Wells Fargo.

Analyst Edward Kelly said in a note to clients on Tuesday that the retailer could see comparable sales growth of around just 2% for the first quarter, excluding fuel.

"We continue to find it hard to get more bullish on COST. While it's a very high quality company with defensive characteristics, we believe momentum matters at the current valuation and see upcoming headwinds. Comps look poised for a sustained period of below trend performance ... which could ultimately result in risk to consensus EPS estimates," Kelly wrote.

Wells Fargo has an equal weight rating on Costco, with a price target of $475 per share. The stock closed at $497.03 per share.

Kelly is in the minority of being skeptical of Costco. Of the 39 analysts who cover Costco, 27 have buy or strong buy ratings, according to Refinitiv.

— Jesse Pound

This chipmaker with "best-in-class" free cash flow returns could rally nearly 30% in the near future, according to Bank of America.

Analyst Vivek Arya reiterated his buy rating on this analog chipmaker and upped his price target to $250 per share, citing a combination of offensive and defensive attributes.

Limited consumer exposure and a wide-range of growth projects in sectors like electric vehicles and digital healthcare also situate the company for strong sales and earnings growth, he added.

Read more on the call from Bank of America here.

— Samantha Subin

One software stock is increasingly well positioned to weather a difficult macro environment, according to Baird.

Analyst Rob Oliver upgraded shares of this company to an outperform rating, saying that its end-market resiliency and reasonable valuation create an attractive risk-reward.

"We believe ongoing strong execution and combination of 20% + revenue growth and operating/FCF margin expansion could help drive multiple expansion over time," he wrote.

Read more on the call from Baird here.

— Samantha Subin

The S&P 500 and Nasdaq Composite each rose by 0.1%, while the Dow Jones Industrials dipped slightly to start Tuesday's session.

— Fred Imbert

Credit Suisse Chairman Axel Lehmann apologized to shareholders on Tuesday for the bank's collapse and controversial takeover by UBS.

"I apologize that we were no longer able to stem the loss of trust that had accumulated over the years, and for disappointing you," Lehmann said during Credit Suisse's annual general meeting. This marked the first time the bank's leaders addressed the public since the buyout deal.

Swiss authorities helped broker an emergency rescue of the troubled bank by its larger domestic rival for just 3 billion Swiss francs, over the course of a weekend in late March.

The deal, which was facilitated by Swiss regulators to stem a wider global banking crisis, remains entangled in legal and logistical challenges. Neither UBS nor Credit Suisse shareholders were allowed a vote on the deal.

— Hakyung Kim

Etsy shares popped more than 4% before the bell after Piper Sandler upgraded shares to overweight from neutral, citing a reacceleration in active buyer growth.

"While we acknowledge that macro conditions remain pressured and consumer spending may be tipping to the downside, we believe ETSY has growth company characteristics at a GARP valuation," wrote analyst Edward Yruma.

Read more on the upgrade here.

— Samantha Subin

Disney CEO Bob Iger said Florida Gov. Ron DeSantis actions against the company were "anti-business" and "anti-Florida."

Iger responded to the latest developments in the feud between the company and the governor during the Disney shareholder meeting Monday. Earlier, DeSantis asked the state's inspector general to determine whether an agreement signed by a Disney-allied board that limits control over the company and its district was legal, or if any company executives were involved.

He said the company, while noting the creation of jobs and tourism boost it provides to the state, was being retaliated against for free speech.

"A year ago, the company took a position on pending Florida legislation," Iger said in an apparent reference to what critics have called the "Don't Say Gay" bill. "And while the company may have not handled the position that it took very well, a company has a right to freedom of speech just like individuals do."

Disney shares advanced 0.6% in the premarket. The stock closed Monday's session down about 0.4%.

— Alex Harring, Sarah Whitten, Kevin Breuninger

Here are some of the stocks making the biggest moves before the bell.

Etsy — The e-commerce company's shares rose 3.9% after Piper Sandler upgraded them to overweight from neutral. The firm said that it thinks Etsy's marketplace strengths will "help reaccelerate active buyer growth." Shares are down 9.6% in 2023. 

Virgin Orbit —  The satellite launch company sank 14% in the premarket after filing for Chapter 11 bankruptcy protection. Virgin Orbit also said it would lay off nearly all of its workforce.

Boeing — The aerospace manufacturer's stock dropped 0.8% after Northcoast Research downgraded shares to a sell rating. The research firm cited expected changes to commercial aircraft production, resetting of consensus forecasts and volume headwinds ahead for Boeing this quarter after communicating with its contacts in the sector. 

Check out the full list here.

— Hakyung Kim

U.S. Treasury Secretary Janet Yellen said the banking crisis is "stabilizing" and regulators are prepared to act again to protect deposits if necessary, according to Bloomberg News.

"My read is the outflows from smaller and medium-sized banks are diminishing and matters are stabilizing, but it's a situation we're watching very closely," Yellen told reporters on Tuesday.

Yellen also pushed back against criticism toward the Financial Stability Oversight Council, which some GOP members have blamed for not identifying the banking crisis earlier. She said the crisis itself only afflicted "a couple of banks" which were extraordinarily exposed to the threat of runs.

"I don't think there's a fundamental problem with the banking system," Yelled added.

— Brian Evans

Virgin Orbit failed to secure enough funding to keep its business afloat and filed for Chapter 11 bankruptcy protection in the U.S. on Tuesday. The California-based satellite launch company is also looking to sell its assets and will lay off nearly all of its workforce.

"While we have taken great efforts to address our financial position and secure additional financing, we ultimately must do what is best for the business," Virgin Orbit CEO Dan Hart said in a statement Tuesday.

Hart said Chapter 11 is the "best path forward" to sell the company. Shares of Virgin Orbit have tanked nearly 90% year to date.

— Michelle Fox, Sam Meredith

Crude oil climbed on Tuesday, with the output cut from OPEC+ continuing to push prices above $80 per barrel.

West Texas Intermediate crude was 1% higher at $81.27 per barrel, while international benchmark Brent ticked up 0.9% to $85.75. The Energy Select Sector SPDR Fund (XLE) also headed higher on Tuesday.

The surprise output cut sent oil prices surging as much as 6% a day earlier, and added to worry that the move could stoke more inflation and add to recession fears.

The output cut amounts to 1.16 million barrels per day, and now puts the total amount of cuts from OPEC+ at 3.66 million barrels per day.

— Brian Evans

The outlook for first-quarter economic growth has declined sharply in recent days, according to a tracker from the Atlanta Federal Reserve.

GDPNow, which adjust its outlook on the go as economic data rolls in, now sees the first three months of the year growing at just a 1.7% annualized pace. As recently as March 23, the tracker had been pointing to growth of 3.5%.

The latest leg down followed Monday's release of the ISM Manufacturing Survey for March. The survey showed that just 46.3% of all manufacturers saw expansion for the month. That was the fifth straight month below 50%, which is the dividing line between expansion and contraction, and the lowest reading since May 2020.

Despite the relatively weak growth, expectations are tilting in favor of the Fed raising its benchmark borrowing rate by another quarter percentage point in May, according to the CME Group's FedWatch tracker.

—Jeff Cox

Analyst Neena Bitritto-Garg initiated coverage of the biotechnology stock with a buy rating, saying in a Tuesday note to clients that a positive vote from a Food and Drug Administration advisory committee on its SRP-9001 therapy could give Sarepta 30% upside.

"Though AdCom meetings do increase risk/volatility into a PDUFA date, we like the setup for shares from here, as we believe the AdCom vote could be positive if focus is on benefit/risk and the relationship between SRP-9001 microdystrophin expression and clinical endpoints," she wrote.

CNBC Pro subscribers can read more here.

— Samantha Subin

JPMorgan Chase CEO Jamie Dimon wrote in his annual letter to shareholders that the U.S. banking crisis is still not over.

"The current crisis is not yet over, and even when it is behind us, there will be repercussions from it for years to come," Dimon said.

"Any crisis that damages Americans' trust in their banks damages all banks – a fact that was known even before this crisis. While it is true that this bank crisis 'benefited' larger banks due to the inflow of deposits they received from smaller institutions, the notion that this meltdown was good for them in any way is absurd," Dimon added. 

— Jesse Pound

Wall Street strategists appear unconvinced that U.S. stocks are the best place to be looking ahead — despite a strong first quarter performance.

Against this backdrop, where should investors put their money?

Here's what the pros think.

— Zavier Ong

European markets opened modestly higher Tuesday, seemingly brushing off concerns over oil price rises following a surprise production cut by the OPEC+ alliance.

The pan-European Stoxx 600 index was up 0.4% at the start of trade, with all major bourses and sectors trading in the green. Mining stocks led gains with a 1.2% uptick, followed by bank stocks, which were up 0.8%. Oil and gas stocks were up 0.4%.

— Hannah Ward-Glenton

The Reserve Bank of Australia has held its its benchmark interest rate at 3.6%.

"The decision to hold interest rates steady this month provides the Board with more time to assess the state of the economy and the outlook, in an environment of considerable uncertainty," the central bank said in its statement.

This marks the first halt in the RBA's hiking cycle since it started raising rates in May 2022.

The Australian dollar weakened following the move to 0.6782 against the U.S. dollar.

– Lim Hui Jie

Correction: This post has been updated to reflect that the RBA started raising rates in May 2022.

Evercore expects an economic downturn this year as the effects of the Federal Reserve's tightening monetary policy continue to ripple through the economy. 

"If you think about it, [we've had] a year's worth of tightening. … If you think about all that tightening to us, [right now] is likely only the beginning of the effects of the tightening, rather than the end of it," Evercore ISI's  senior managing director Julian Emanuel said on CNBC's "Fast Money."

"We do think there's probably more to come—and in that respect, we're going to have a recession, even if it's mild, as we expect. We think stocks will bear the brunt of it," Emanuel continued. 

Emanuel anticipates that companies will see their earnings soften in the second quarter of 2023, which could potentially call into question the Nasdaq's strong year-to-date rally. The tech-heavy index has jumped 17.3% in 2023.

He mentioned that Evercore has added small-cap stocks to its portfolio today as a defensive play in the current market. 

"Small caps actually have a larger-than-normal weighting towards the more defensive sectors, including healthcare and energy — which we think makes a lot of sense right here," Emanuel said. 

"Basically what it does is it gives you the put-option protection through high free cash flow. If the economy turns down as we expect —or importantly, if there's a credit crunch —you're protected with free cash flow, and then the call optionality part of it is in an environment where earnings estimates have been coming in across the broad spectrum of stocks. These stocks are still having upward revisions. That's a good thing," added Emanuel.

— Hakyung Kim

JPMorgan analysts said that the move by OPEC+ was a "preemptive" move and that it had expected similar measures to come earlier.

"We view the current reduction in supply as a preemptive measure, assuring that surpluses that started accumulating in the global oil market since mid-2022 don't extend into the second half of 2023 as the global economy slows following almost 400 bps of cumulative hikes since 2022," analysts including Natasha Kaneva wrote in a late Sunday note.

Contrary to Goldman Sachs that raised its forecast for Brent oil rising to $95 per barrel by December 2023, JPMorgan said their forecast remains unchanged at $89 in the second quarter of this year – rising to $94 by the fourth quarter of 2023 and ending the year at $96 per barrel.

– Jihye Lee

Stock futures were little changed to begin trading Monday evening.

Dow Jones Industrial Average futures inched down by 30 points or 0.09%. S&P 500 futures slipped by 0.08%, and Nasdaq 100 futures dipped by 0.14%.

In regular trading the Dow rose 327 points, or 0.98%, and the S&P 500 added 0.37%. The Nasdaq Composite slid 0.27%.

— Tanaya Macheel