Wall Street taps the brakes

Rare slowdown following record-setting rally

NEW YORK — Wall Street hit the brakes on its big rally Wednesday following disappointing profit reports from companies and warnings that the market had simply gone too far, too fast.

The S&P 500 slumped 1.5% for its worst loss since beginning a monster-sized rally shortly before Halloween. The Dow Jones Industrial Average dropped 475 points, or 1.3%, from its record high, while the Nasdaq composite sank 1.5%

Fedex tumbled 12.1% for one of the market’s biggest losses after reporting weaker revenue and profit for the latest quarter than analysts expected. It also now expects its revenue for its full fiscal year to fall from yearearlier levels, rather than being roughly flat, because of pressures on demand.

The package delivery company pumps commerce around the world, and its signal for potentially weaker demand could dim the hope that’s fueled Wall Street’s recent rally: that the Federal Reserve can pull off a perfect landing for the economy by slowing it enough to stifle high inflation but not so much that it causes a recession.

Winnebago Industries also fell short of analysts’ profit expectations for the latest quarter. The maker of motorhomes and other recreational products said it sold fewer units than a year earlier because of “market conditions” and had to offer higher discounts. Its stock dropped 5.6%.

General Mills, which sells Progresso soup and Yoplait yogurt, reported stronger profit for the latest quarter than expected, but its revenue fell short as a recovery in its sales volume was slower than expected. The com

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