clearn.png
Sunday September 25th, 2022 1:11AM

Tech rebound lifts stocks on Wall Street after early slide

By The Associated Press
Related Articles
  Contact Editor

A late-afternoon rebound led by technology companies helped drive stocks higher on Wall Street Thursday, lifting the market from an early slide.

The S&P 500 rose 0.4%, its first gain after a two-day slump. The benchmark index is still on pace for its first weekly loss in four weeks.

The Dow Jones Industrial Average rose 0.3% and the tech-heavy Nasdaq managed a 0.1% gain. Crude oil prices edged lower and bond yields rose.

The choppy day of trading came as investors weighed the latest updates from the Federal Reserve amid concerns about rising inflation. The central bank has signaled it is prepared to keep raising interest rates and reducing its stockpile of bonds and mortgage-backed securities in order to rein in the highest inflation in 40 years.

“The market is certainly having to digest a Fed that appears to be willing to be very aggressive in battling inflation,” said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management.

The S&P 500 rose 19.06 points to 4,500.21. The Dow gained 87.06 points to 34,583.57. The blue-chip index had earlier been down 305 points. The Nasdaq added 8.48 points to 13,897.30.

Higher interest rates can make pricey growth stocks, like those of Big Tech companies, look less attractive relative to their earnings. Tech stocks have been among the biggest drags on the market the past couple of days and were weighing down the indexes Thursday morning. But the sector began to recover by midafternoon, helping lift the broader market. Microsoft rose 0.6% and Adobe rose 1.9%.

Health care stocks, retailers and other companies that rely on direct consumer spending also rose after having been down earlier in the day. Pfizer rose 4.3%, Target gained 5.7% and McDonald’s rose 1.2%.

Communication services stocks were among the biggest weights on the market. Twitter fell 5.4%.

Computer and printer maker HP surged 14.8% for the biggest gain in the S&P 500 after Warren Buffett’s Berkshire Hathaway disclosed an 11% stake in the company.

Bond yields rose. The yield on the 10-year Treasury rose to 2.65% from 2.61% late Wednesday.

Every major index is in the red for the week following two big losses that were partly prompted by concerns over the Fed's shifting policy as it tries to combat inflation.

Minutes from the Fed’s meeting last month showed policymakers agreed to begin cutting the central bank's stockpile of Treasurys and mortgage-backed securities by about $95 billion a month, starting in May. That’s more than some investors expected and nearly double the pace the last time the Fed shrank its balance sheet.

The central bank is reversing course from low interest rates and the extraordinary support it began providing for the economy two years ago when the pandemic knocked the economy into a recession. It already announced a quarter-percentage point increase and is expected to keep raising rates throughout the year.

Traders are now pricing in a nearly 80% probability the Fed will raise its key overnight rate by half a percentage point at its next meeting in May. That’s double the usual amount and something the Fed hasn’t done since 2000.

Persistently rising inflation has been threatening economic growth. Business have been raising prices on everything from food to clothing and that has put more pressure on consumers. Some companies have been unable to offset the impact from inflation, even with price hikes.

Duncan Hines and Birds Eye brands maker ConAgra cut its financial forecast for the year and said another round of price increases will be needed.

Wall Street is concerned about consumers eventually pulling back on spending as higher prices become too difficult to digest. Price increases were responsible for a rise in consumer spending in March, otherwise, the results revealed a pullback.

A rapid increase in interest rates could also affect corporate earnings growth, though gauging that depends on how aggressive the Fed will be.

“Do we have to take earnings expectations down?” Haworth said. “That’s what the market’s really (been) trying to decide over the last couple of days. Is the aggressiveness of the Fed going to change that equation?”

Russia's invasion of Ukraine has also added to concerns about inflation. Energy prices have been particularly volatile and pushed gasoline prices higher. U.S. benchmark crude oil prices fell 0.2%, but are still up roughly 31% for the year.

Investors received an encouraging update on the job market Thursday. The Labor Department reported that fewer Americans applied for unemployment benefits last week as layoffs remain at historically low levels.

  • Associated Categories: Associated Press (AP), AP Business, AP Business - Economy, AP Business - Financial Markets, AP Business - Industries, AP Business - Financial Services, AP Business - Utilities
© Copyright 2022 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
UN aid chief: 'I'm not optimistic' about Ukraine ceasefire
The United Nations’ humanitarian chief says he is not optimistic about securing a ceasefire to halt the fighting in Ukraine
4:13PM ( 6 minutes ago )
Israeli hospital: 2 killed, 8 wounded in Tel Aviv shooting
Israeli medics say at least two people were killed and several were wounded in a shooting in central Tel Aviv
4:08PM ( 11 minutes ago )
Manhattan DA: Trump criminal investigation is continuing
Manhattan District Attorney Alvin Bragg says a criminal investigation into former President Donald Trump and his business practices is continuing despite a recent shakeup in the probe’s leadership
4:08PM ( 11 minutes ago )
Associated Press (AP)
Europe agrees to ban Russian coal, but struggles on oil, gas
The European Union is banning Russian coal imports
3:42PM ( 37 minutes ago )
Tech rebound lifts stocks on Wall Street after early slide
Stocks recovered from an early slide and turned higher on Wall Street Thursday afternoon as investors weigh the latest update from the Federal Reserve amid concerns about rising inflation
3:41PM ( 39 minutes ago )
Fed casting its inflation fight as battle against inequality
As the Federal Reserve intensifies its efforts to tame high inflation, its top officials are casting their aggressive drive in a new light: As a blow against economic inequality
3:38PM ( 41 minutes ago )
AP Business
Stocks fall on Wall Street, weighed down by tech losses
Stocks edged lower in afternoon trading on Wall Street Thursday as investors weigh the latest update from the Federal Reserve amid concerns about rising inflation
1:56PM ( 2 hours ago )
Warren Buffett buying spree goes on, HP soars on 11.5% stake
Shares of HP are up nearly 15% after Warren Buffett's company snapped up 11.5% of the company that makes printers and computers over the past week in another uncharacteristic investment for the billionaire in a tech company
11:56AM ( 4 hours ago )
Live Updates | US moves to end exports to 3 Russian airlines
The U.S. has moved to choke off U.S. exports to three Russian airlines as part of what officials described as an unprecedented enforcement action
11:54AM ( 4 hours ago )
AP Business - Economy
Turkey suspends trial of Saudi suspects in Khashoggi killing
A Turkish court has suspended the trial in absentia of 26 Saudis accused in the gruesome killing of Washington Post columnist Jamal Khashoggi and ruled that the case be transferred to Saudi Arabia
8:43AM ( 7 hours ago )
World shares track Wall St retreat on interest rate worries
World shares are mixed after a retreat on Wall Street spurred by comments indicating the Federal Reserve intends to more aggressively tackle inflation
5:14AM ( 11 hours ago )
Asian shares track Wall St retreat on interest rate worries
Asian shares have tracked a retreat on Wall Street after details from last month’s Federal Reserve meeting showed the central bank plans to be aggressive in fighting inflation
2:00AM ( 14 hours ago )
AP Business - Financial Markets
Live Updates | Zelenskyy: Shut Cyprus ports to Russian ships
Ukraine’s president has asked Cyprus lawmakers to ratchet up pressure on Russia by shutting Cypriot ports to all Russian ships, and to stop granting Russian businessmen conveniences including Cypriot citizenship
2:00PM ( 2 hours ago )
European Central Bank head says she's positive for COVID-19
European Central Bank President Christine Lagarde has tweeted that she tested positive for COVID-19 and has mild symptoms but will continue working at home
12:49PM ( 3 hours ago )
Major outage forces Puerto Rico to shutter schools, offices
More than a million customers in Puerto Rico remain without electricity after a fire at a main power plant caused an island-wide blackout that forced the U.S. territory to cancel classes and shutter government offices in the biggest outage yet this year
12:14PM ( 4 hours ago )
AP Business - Industries
Live Updates | Russia-Ukraine War
Ukrainian Foreign Minister Dmytro Kuleba is appealing to NATO to provide his war-torn country with weapons to help avoid further atrocities like those reported in the town of Bucha this week
2:10AM ( 14 hours ago )
Fed signals more aggressive steps to fight inflation
Federal Reserve officials are signaling that they will take a more aggressive approach to fighting high inflation in the coming months — actions that will make borrowing sharply more expensive for consumers and businesses and heighten risks to the economy
4:25PM ( 23 hours ago )
Fed moves toward slashing bond holdings to fight inflation
The Federal Reserve is moving closer to rapidly shrinking its huge $9 trillion stockpile of bonds in the coming months to fight high inflation, a move that would contribute to higher borrowing costs for consumers and businesses
2:05PM ( 1 day ago )
AP Business - Financial Services
US diplomat: Mediterranean gas pipeline to Europe not viable
A senior U.S. diplomat says a proposed pipeline to deliver natural gas from deposits in the east Mediterranean to European markets is too expensive, not economically viable and will take too long to help countries seeking alternatives to Russian gas any time soon
5:32AM ( 10 hours ago )
Shell says Russia exit has already cost $5 billion
Shell says its decision to pull out of Russia in response to the country’s invasion of Ukraine has already cost the international energy giant as much as $5 billion
5:28AM ( 10 hours ago )
Spain PM in Morocco to mend ties after Western Sahara shift
Spanish Prime Minister Pedro Sánchez is set to meet with Moroccan King Mohammed VI during a two-day visit to Rabat that promises to mark an easing of diplomatic tensions centered on Morocco's disputed region of Western Sahara
3:40AM ( 12 hours ago )
AP Business - Utilities
UN aid chief: 'I'm not optimistic' about Ukraine ceasefire
The United Nations’ humanitarian chief says he is not optimistic about securing a ceasefire to halt the fighting in Ukraine
4:13PM ( 7 minutes ago )
Israeli hospital: 2 killed, 8 wounded in Tel Aviv shooting
Israeli medics say at least two people were killed and several were wounded in a shooting in central Tel Aviv
4:08PM ( 11 minutes ago )
Manhattan DA: Trump criminal investigation is continuing
Manhattan District Attorney Alvin Bragg says a criminal investigation into former President Donald Trump and his business practices is continuing despite a recent shakeup in the probe’s leadership
4:08PM ( 12 minutes ago )
Russian Nobel-winning editor says he was attacked on train
Nobel Peace Prize-winning newspaper editor Dmitry Muratov says he was attacked on a Russian train by an assailant who poured red paint on him, causing severe discomfort to his eyes
4:04PM ( 15 minutes ago )
China used TV, TikTok stars in discreet Olympics campaign
A “Real Housewives of Beverly Hills” TV star, a Paralympic swimmer and a self-described “brand king” were among the Instagram and TikTok influencers who were paid by Chinese officials for a discreet campaign that promoted the Beijing Winter Olympics, new Justice Department documents reveal
4:01PM ( 18 minutes ago )