Wall Street ends mixed after erasing a big morning loss

NEW YORK – Another roller-coaster day left Wall Street essentially where it began on Wednesday, after stocks veered on worries about how badly a slowing economy will hit corporate profits.

The S&P 500 finished virtually unchanged, but only after it tumbled to a morning loss of 1.7% and then roared all the way back. The Dow Jones Industrial Average erased a 460-point loss to finish up 9 points. The Nasdaq composite fell 0.2% after coming back from a 2.3% drop.

Such big swings have been common on Wall Street as markets work through a couple competing big ideas. On one hand, worries are rising about weakening profits and an economy bending under the weight of hikes to interest rates by the Federal Reserve. On the other are hopes that the economy can avoid a severe recession and that cooling inflation will get the Fed to take it easier on rates.

“There’s this Jekyll and Hyde market day to day,” said Anthony Saglimbene, chief market strategist at Ameriprise. “What narrative is driving the market: a soft landing or harder landing?”

In the morning, the latter was driving trading.

Microsoft helped to lead the way lower after giving a forecast for upcoming results that fell short of some analysts’ expectations. They pointed in particular to expectations for slowing growth in its Azure cloud business.

Microsoft is one of Wall Street’s dominant stocks because it’s one of the largest, which gives its stock movements more sway over the S&P 500 than others. Not only that, analysts say Microsoft offers one of the best windows into the strength of corporate spending because of how many businesses use its software and services.

Microsoft fell as much as 4.6% in the morning before paring its loss to 0.6%. Its weaker-than-expected forecasts helped drag down other stocks in the cloud-computing industry in the morning. Snowflake fell as much as 7.9%, for example, before it pared its loss to 0.9%.