Stocks turn mixed on Wall Street a day after big sell-off
Stock indexes on Wall Street ended a choppy day of trading with a mixed finish Tuesday, after an afternoon rally in technology companies helped reverse an early slide.
The S&P 500 closed 0.2% higher, snapping a three-day losing streak, after swinging between a gain of 1.9% and a loss of 0.8%. A day earlier, the benchmark index slumped 3.2%, hitting its lowest level in more than a year.
The Dow Jones Industrial Average slipped 0.3%, while the tech-heavy Nasdaq climbed about 1%.
Big technology stocks, which have been swinging sharply both up and down recently, helped counter losses elsewhere in the market.
The market's see-saw action came ahead of the release of the Labor Department's consumer price index, a key economic report on inflation that investors will be closely watching as they try to gauge how aggressively the Federal Reserve will raise interest rates as it fights inflation.
Economists expect the index eased to 8.1% in the 12 months ended in April. That would mark the first annual decline since August.
“If inflation is a lot lower, as they're expecting it to be, then we may very well see the markets rally because perhaps people think the Fed won't hike as much or as aggressively,” said Randy Frederick, managing director of trading & derivatives at Charles Schwab.
The S&P 500 rose 9.81 points to 4,001.05. The
Dow slipped 84.96 points to 32,160.74. The Nasdaq gained 114.42 points to 11,737.67.
The Russell 2000 index of smaller companies fell 0.29 points, or less than 0.1%, to 1,761.79.
Big technology stocks, which have been swinging sharply both up and down recently, accounted for much of the S&P 500's turnaround. Apple rose 1.6% and Microsoft rose 1.9%.
Gains in communication and health care stocks also helped lift the market, outweighing declines in financial, real estate and other sectors.
Bond yields ended mixed. The yield on the 10-year Treasury fell to 2.99% from 3.08% late Monday.
Treasury yields have been rising and stocks have been extremely volatile recently as Wall Street adjusts to an aggressive turnaround in the Federal Reserve's policies away from supporting the economy. The central bank is raising interest rates from historic lows to fight persistently rising inflation, which is at its highest levels in four decades.
The Fed has raised its benchmark rate from close to zero, where it sat for much of the coronavirus pandemic. Last week, it indicated it will double the size of future increases.
Higher prices on raw materials, shipping and labor have been cutting into corporate financial results and forecasts. Many companies have been raising prices on everything from clothing to food, raising concerns that consumers will eventually cut spending, which would hurt economic growth.