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Wednesday June 29th, 2022 12:00PM

More weakness in technology stocks leaves US indexes lower

By The Associated Press
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More declines in big technology stocks pulled major indexes lower on Wall Street, driving the market further into the red on the first week of the year. The S&P 500 wobbled between gains and losses for much of the day Thursday before closing down 0.1%. Weakness in big tech companies like Apple was the main culprit. The Nasdaq also fell 0.1% and the Dow Jones Industrial Average fell 0.5%. Small-company stocks bucked the trend and closed higher. Bond yields continued to rise a day after the Federal Reserve indicated it was ready to raise interest rates to fight off inflation.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

Stocks are wobbling in afternoon trading on Wall Street Thursday as investors consider the outlook for rising interest rates and inflation.

The S&P 500 moved between gains and losses throughout the morning and was up 0.2% as of 2:11 p.m. Eastern. The Dow Jones Industrial Average was down 114 points, or 0.3%, to 36,286, and the Nasdaq rose 0.3%.

Banks made some of the biggest gains as bond yields continued to rise a day after the Federal Reserve indicated it was ready to raise interest rates to fight off inflation. The yield on the 10-year Treasury rose to 1.73% from 1.70% late Wednesday. Citigroup gained 3.8%. Higher bond yields allow banks to charge more lucrative interest on loans.

U.S. crude oil prices rose 1.8% and helped send energy stocks higher. ConocoPhillips rose 3.3%.

A mix of retailers and health care stocks fell. Tesla fell 2.3% and UnitedHealth Group fell 3.8%

Several big technology stocks, which have an outsized influence on the S&P 500 because of their huge size, slipped. Apple was down 1%.

Smaller company stocks were faring better than the broader market. The Russell 2000 index was up 0.8%.

Stocks have been choppy this week as traders reacted to the big rise in bond yields. The S&P 500 and Dow both set all-time highs on Monday, only to lose ground in subsequent days. The major indexes are now on pace to post weekly losses.

Investors have been closely monitoring rising inflation's impact on consumers and businesses. They have also been watching the Fed's plans to dial back its ultra-low interest rate policies. Minutes from the central bank's meeting in December showed that policymakers expressed concerns that inflation, which has surged to four-decade highs, was spreading into more areas of the economy and would last longer than they previously expected.

The central bank has already said it will accelerate the reduction of its bond purchases, which have helped keep interest rates low. Investors are watching for the impact from that pullback and gauging how quickly and how often the central bank will raise its benchmark interest rate.

Wall Street has also been weighing several economic reports this week.

On Thursday, The Institute for Supply Management reported that growth in the U.S. service industry, where most Americans work, pulled back in December after expanding at a record pace the previous two months.

The Labor Department reported that the number of Americans applying for unemployment benefits rose last week but remained at historically low levels, suggesting that the job market remains strong. The agency will release its monthly jobs report on Friday.

  • Associated Categories: Associated Press (AP), AP Business, AP Business - Economy, AP Business - Financial Markets, AP Business - Industries, AP Business - Financial Services
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