Stocks slip in mixed trading as tech drops

NEW YORK – Wall Street slipped in mixed trading Thursday as the threat of high interest rates continues to dog Big Tech stocks.

The S&P 500 fell 14.34, or 0.3%, to 4,451.14 for its third straight loss. The Nasdaq composite was hit particularly hard by the drop for tech stocks, and it sank 123.64, or 0.9%, to 13,748.83.

The Dow Jones Industrial Average held up better than the rest of the market because it has less of an emphasis on tech, and it rose 57.54 points, or 0.2%, to 34,500.73. The Russell 2000 index of smaller companies fell 18.52 points, or 1%, to 1,855.76.

Stocks felt pressure from the bond market, where yields rose earlier in the week after a report showed stronger growth for U.S. services industries last month than economists expected. Yields remained high after a report on Thursday said fewer U.S. workers applied for unemployment benefits last week than expected.

While such reports are encouraging for the economy, indicating a recession is not near, they could also keep conditions strong enough to push upward on inflation.

The Federal Reserve has already hiked its main interest rate to the highest level in more than two decades in hopes of slowing the economy enough to drive inflation back down to its 2% target. It has come close, and inflation has cooled from its peak above 9% last summer. But the worry is that the last percentage point of improvement may be the toughest for the Fed.

“Yes, the economy has slowed and inflation has cooled, but employment continues to be a thorn in the side of the Fed, which has made softening the jobs market the cornerstone of its inflation battle,” said Mike Loewengart, head of model portfolio construction at Morgan Stanley Global Investment Office.

High interest rates drag down stock prices. But they tend to most hurt stocks of technology companies and others bid up on expectations for high growth far in the future.

Apple is the dominant force on Wall Street because it’s the most valuable stock, and it fell 2.9% to follow up on its 3.6% drop a day before.

Nvidia sank 1.7% to bring its loss for the week so far to 4.7%. It and a cohort of other stocks in the artificialintelligence industry have soared this year on expectations that AI could mean explosive future growth in profits.

Power companies and other stocks seen as steadier investments held up better than the rest of the market.

Utility stocks in the S&P 500 rose 1.3% as a group. That was nearly double the gain of any of the other 10 sectors that make up the index.

In the bond market, the yield on the two-year Treasury initially jumped after the unemployment report but then eased as the day progressed. It slipped to 4.95% from 5.03% late Wednesday, but it remains above the 4.88% level where it started the week.

Gold for December delivery fell $1.70 to $1,942.50 an ounce. Silver for December delivery fell 26 cents to $23.24 an ounce. December copper fell 3 cents to $3.76 a pound.

The dollar fell to 147.20 Japanese yen from 147.71 yen. It fell to $1.0695 from $1.0726 against the euro.