The Dow drops by over 500 points as the bear market rebound fizzles.

• Dow Jones Industrial Average slid 491.27 points (1.56%) to 30,946.99.
• Disappointing economic data reversed key averages’ gains.
• The Conference Board’s consumer confidence index slipped to 98.7 from 103.2 in May.

U.S. equities dipped Tuesday, erasing earlier gains as the market struggled to bounce from bear-market lows.

Dow Jones Industrial Average slid 491.27 points (1.56%) to 30,946.99. S&P 500 down 2.01% to 3,821.55, and Nasdaq Composite fell 3% to 11,181.54.

The Dow gained 446.83 points (1.4%). S&P 500 and Nasdaq both rose 1.2%. Disappointing economic data reversed key averages’ gains.

The Conference Board’s consumer confidence index slipped to 98.7 from 103.2 in May, below the Dow Jones prediction of 100. Weak statistics came as fears of a recession grew as the Fed raised rates to tackle growing inflation.

The Conference Board stated June 12-month inflation estimates were 8%, the highest level since August 1987.

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“Actual spending and economic activity are still healthy, but consumer confidence and financial conditions (particularly interest rates) indicate a slowdown ahead,” said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance. If we escape a recession, the stock market is fairly valued, but if we fall into one, the year’s lows haven’t been reached yet.

Wall Street had earlier losses. Investors hope last week’s rise holds, but there’s no clear catalyst for a big return.

Chris Verrone, a Strategas technical analyst, said it’s difficult to tell the difference between a bear market bounce and a lasting advance. The current rally, +8% over the last 4 trading days, is great on the surface, but has yet to demonstrate internal or leadership improvement.

Consumer confidence lowered retail stocks. The company lost 5.8%. Lowe’s plummeted 5.2%, Home Depot and Macy’s each lost 4%. SPDR S&P Retail fell 3.7%.

Nike shares slumped 7% after the firm published weaker-than-expected revenue guidance. Nike expects flat to slightly higher revenue for its fiscal first quarter and low double-digit revenue for 2023 on a currency-neutral basis as it manages Covid disruption in Greater China.

Nvidia fell 5.3% and AMD 6.2%. Marvel dropped 4.9%. Qualcomm gained 3.5% after an analyst said Apple will use its modems in 2023.

China lowered inbound tourists’ Covid quarantine duration in half to seven days on Tuesday. Travel and casino stocks rose. Wynn Resorts and Las Vegas Sands each increased 3.2%. As the market turned bearish, airlines lost ground.

Shanghai Disneyland will reopen this week, boosting Disney shares. With the market, shares fell.

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