The S&P 500 (^GSPC +0.46%) fell 0.17% to 7,786, the Nasdaq Composite (^IXIC +0.45%) lost 0.28% to 26,729, and the Dow Jones Industrial Average (^DJI +0.56%) slipped 0.20% to 53,732 as disappointing economic data stalled the recent rally.

S&P 500 Index

Key Data Points

Gold prices rose 0.24% to $4,373.48 as of U.S. market close, and the 10-Year Treasury yield fell 0.05% to 4.69%. Energy and basic materials finished as the top-performing sectors, but drops in technology and healthcare stocks weighed on indexes.

Today's biggest moves

Reddit shares jumped 13% following news that the social media company will join the S&P 500 next week. Broadcom tumbled 6% after Bank of America analysts questioned a potential $370 billion debt financing vehicle. Applied Materials also faced selling pressure despite an earnings beat.

What this means for investors

Markets retreated from record highs today as traders reacted to a drop in consumer confidence and a slowdown in consumer spending. July retail sales were down 0.6% month-on-month, sparking concerns about consumer health and economic growth despite a strong corporate earnings season.

The dip in Broadcom stock reflects an emerging theme: In addition to questioning the magnitude of artificial intelligence (AI) spending, the way firms finance their AI build-outs is also under scrutiny. A recent note from Goldman Sachs (GS +0.19%) says hyperscalers are using lease commitments and other debt structures to fund expansion. Investors are taking note.

Meanwhile, borrowing rates are in focus after the U.S. government just sold 30-year bonds at a 5.216% interest rate -- the highest it's been in 25 years. The rate reflects investor concern about inflation, rising energy prices, and the growing national deficit.