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The S&P 500 has set record highs in all of its four last trading sessions, but that run looks to have come to an end today after a mixed bag of earnings on Wall Street.
The worst of the bunch was Caterpillar, the maker of construction and mining machinery, which slid more than 6% after cutting its full-year revenue forecast and reporting a quarterly profit of $1.45 a share, well below the $1.66 a share that had been expected by analysts.
With the recent stock market rally, valuations had been starting to look a little toppy, so when a major player like Caterpillar, which is seen as a bellwether for the industrial sector and has a global exposure, falls so short of expectations it is understandable that investors show a little caution.
Broadcom managed to beat earnings expectations, but gave guidance for fourth-quarter revenue below the levels that analysts had been predicting, while it was a similar story with Juniper Networks, which also warned that it would be cutting 3% of its workforce.
By early afternoon in New York, the Dow had fallen 0.44% to 15,399 and the S&P 500 declined 0.5% to 1745.7.
Safe-haven assets have been in demand today, after short-term money market rates rose in China. The benchmark seven-day repo rate, which had previously been in decline, climbed suddenly earlier today, reaching as high as 4.55%, representing a rise of over 1%.
The spike did not persist, but concerns that authorities may tighten liquidity to combat rising inflation has driven investors scrambling for safe-haven currencies, such as the Japanese yen and the Swiss franc.