S&P 500 Declines For 4th Session: Investor Sentiment Falls Further, But Fear Index Remains In 'Greed' Zone

The CNN Money Fear and Greed index showed a decline in the overall market sentiment, while the index remained in the “Greed” zone on Wednesday.U.S. stocks settled mostly lower on Wednesday, with the Nasdaq Composite falling more than 100 points during the session.The Federal Reserve indicated that inflation risks remain “considerable” due to the uncertain impact of new trade tariffs, casting fresh doubt over imminent interest rate cuts, according to the July Federal Open Market Committee minutes released Wednesday.President Trump called for the resignation of Democratic-appointed Fed Governor Lisa Cook. U.S. Federal Housing Finance Agency director William Pulte alleged in a letter to Attorney General Pam Bondi that Cook "potentially" committed mortgage fraud.Traders are currently pricing in an 85% chance of a 25-basis-point cut next month.Shares of Palantir Technologies Inc. PLTR — a poster child of the AI-driven rally — fell another 1% on Wednesday, paring steeper early losses. The drop followed Tuesday’s 9.4% plunge, marking the stock’s worst two-day slump since April.Lowe’s Companies, Inc. LOW reported better-than-expected earnings for the second quarter. Target Corp. TGT shares fell around 6% on Wednesday following the release of second-quarter results.On the economic data front, the volume of mortgage applications in the U.S. fell by 1.4% from the previous week in the second week of August.Most sectors on the S&P 500 closed on a positive note, with energy, health care and consumer staples stocks recording the biggest gains on Wednesday. However, information technology and consumer discretionary stocks bucked the overall market trend, closing the session lower.The Dow Jones closed higher by around 16 points to 44,938.31 on Wednesday. The S&P 500 fell 0.24% to 6,395.78, while the Nasdaq Composite dipped 0.67% at 21,172.86 during Wednesday's session.Investors are awaiting earnings results from Walmart Inc. WMT, Intuit Inc. INTU and Ross Stores Inc. ROST today.What is CNN Business Fear & Greed Index?At a current reading of 56.0, the index remained in the “Greed” zone on Wednesday, versus a prior reading of 59.7.The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greediness. Top 2 Financial Stocks You May Want To Dump In Q3 Photo via Shutterstock