Stock market today: Wall Street falls to close out its first losing week in the last six

NEW YORK (AP) – Another drop for stocks on Friday helped drag Wall Street to its first losing week in the last six.

The S&P 500 fell 33.56, or 0.8%, to 4,348.33, pulling back further from last week when it reached its highest level in more than a year. The Dow Jones Industrial Average dropped 219.28, or 0.6%, to 33,727.43, and the Nasdaq composite sank 138.09, or 1%, to 13,492.52.

Overseas markets also fell, while crude oil prices slipped amid worries that a stressed global economy may burn less fuel.

Europe’s economy appears to be weaker than expected, according to a preliminary report measuring manufacturing and services businesses. That added to the week’s hesitance in markets, caused by a crank higher in interest rates by central banks around the world as they try to get high inflation under control.

High rates drive down inflation by slowing the economy, which raises the risk of a recession.

High interest rates in the United States have already dragged manufacturing and other industries into contraction, while also helping to cause several failures in the banking system that rattled confidence. Federal Reserve Chair Jerome Powell said this week that even though his central bank didn’t raise rates last week, it could still push through a couple more hikes by the end of this year.

Critics have also said the U.S. stock market was due for a breather after it climbed too far, too fast following a rally of more than 20% since mid-October. The S&P 500 just broke its longest weekly winning streak since November 2021.

Much of the exuberance was because the U.S. economy had managed to avoid a recession, even though the Fed hiked rates at a breakneck pace since early 2022. The job market in particular has remained remarkably solid.

Wall Street’s hope has been that slowing inflation could get the Fed to take it easier on rates, while a small cadre of stocks soared to incredible heights amid a frenzy around artificial-intelligence technology.

Wall Street traders for the most part are still expecting fewer rate hikes this year than what the Fed has suggested. They may once again be underestimating the Fed’s resolve, economist Ethan Harris wrote in a BofA Global Research report.