(Updates to closing, adds quote in paragraph 5 and 12)
Skyworks, Paypal drop on downbeat forecasts
Novovax surges on layoff plans
US CPI report due on Wednesday
By Carolina Mandl and Caroline Valetkevitch
NEW YORK, May 9 (Reuters) -
Major U.S. stock indexes closed lower on Tuesday as investors grew more cautious ahead of a U.S. consumer price index report and a meeting between U.S. political leaders to discuss the debt ceiling.
Investors will look for clues on whether inflation is continuing to ease following the Labor Department's consumer price index (CPI) report on Wednesday.
Talks over the U.S. debt ceiling are adding to caution in the market as traders were also waiting for an update on plans for the debt ceiling from a meeting between U.S. President Joe Biden, Republican House Speaker Kevin McCarthy and other congressional leaders at the White House.
Worries of a potential government default loom over Washington as early as June 1, if Congress does not act to resolve the deadlock.
"Overall, it's a relatively mild day, but both the debt ceiling as well as the inflation are causing some anxiety," said Randy Frederick, managing director of trading and derivatives at the Schwab Center for Financial Research.
According to preliminary data, the S&P 500 lost 18.87 points, or 0.46%, to end at 4,119.25 points, while the Nasdaq Composite lost 77.36 points, or 0.63%, to 12,179.55. The Dow Jones Industrial Average fell 54.67 points, or 0.16%, to 33,564.02.
Disappointing forecasts from companies such as PayPal and Apple supplier Skyworks also weighed on the mood, while regional banks like Pacwest Bancorp rose.
Shares of PayPal Holdings dropped and pressured the benchmark S&P 500 after the company cut its margin forecast. The stock was also among the top drags on the Nasdaq.
Skyworks Solutions Inc shares slid after the company forecast current-quarter revenue and earnings below estimates.
"Companies have generally been beating earnings expectations, but earnings season is always choppy, and today we have some weaker results. That's weighing a bit on the market," said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York.
Shares of other Apple suppliers including Qualcomm, Broadcom, Qorvo and Corning were also lower. The Philadelphia SE Semiconductor Index was down.
Boeing Co rose after budget carrier Ryanair Holdings Plc placed a multi-billion dollar order for Boeing jets.
Novavax surged as the drugmaker plans a 25% cut to its global workforce.
Under Armour Inc lost ground as the sports apparel maker saw its annual sales and profit below street expectations.
Dialysis services provider DaVita Inc jumped on a rise in its annual profit forecast as demand for procedures pick up in the U.S.
(Reporting by Shreyashi Sanyal and Shristi Achar A in Bengaluru and additional reporting by Caroline Valetkevitch in New York; Editing by Sonia Cheema, Anil D'Silva and Deepa Babington)