Stocks give up an early gain and close lower on Wall Street
NEW YORK — Stocks gave up an early gain and closed lower on Wall Street as markets continue an unsteady search for direction. Several companies made big moves, both higher and lower, as more of them reported their latest quarterly results.
NEW YORK — Stocks gave up an early gain and closed lower on Wall Street as markets continue an unsteady search for direction. Several companies made big moves, both higher and lower, as more of them reported their latest quarterly results. The S&P 500 fell 0.8% Thursday. The benchmark index was still holding on to a gain for the week. The Dow Jones Industrial Average and the Nasdaq also fell. Treasury yields remained at multiyear highs, which has helped push up rates on mortgages. Home sales fell again in September for the eighth month in a row.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Stocks are down and bond yields are climbing in afternoon trading Thursday, as traders monitor the latest batch of corporate earnings reports for clues as to how companies are navigating rising interest rates and the highest inflation in decades.
The S&P 500 fell 0.9% as of 2:42 pm Eastern. Nearly 80% of the stocks in the benchmark index were in the red, with retailers, banks and industrial companies among the biggest weights. The Dow Jones Industrial Average slid 121 points, or 0.4%, to 30,304 and the Nasdaq fell 0.9%.
Treasury yields continued rising into multiyear highs, which has helped push up rates on mortgages and other loans. The yield on the 10-year Treasury climbed to 4.20% from 4.14% late Wednesday and is at its highest level in 14 years. The yield on the two-year Treasury, which tends to track expectations for future Federal Reserve action, rose to 4.58% from 4.56%.
Earnings have been the big focus for Wall Street all week as investors try to get a better picture of how companies are faring amid the hottest inflation in four decades and how they see the economy moving forward.
The results have been mixed so far. Several big companies released encourage financial results, while others have disappointed investors with weak or worrisome warnings.
IBM rose 5% after its third-quarter earnings and revenue topped analysts’ forecasts. AT&T jumped 7.6% after also reporting strong results.
Tesla fell 7.1% after saying it will miss its target for vehicle deliveries this year. Railroad Union Pacific dropped 6.2% after predicting slower growth, suggesting that the economy may be slowing down. CSX, which reports its results later Thursday, fell 3.2%. American Airlines fell 3.5% after reporting its latest results.
Allstate slumped 12.4% after giving investors a disappointing financial update.
Markets in Europe were mostly higher. British Prime Minister Liz Truss resigned following financial market turmoil caused by multiple policy U-turns.
Investors remain concerned about inflation and the potential for recessions throughout the world. Wall Street is particularly worried about the Fed’s ongoing plan to raise interest rates in order to slow economic growth and tame high prices. The US economy is already showing signs of a slowdown and the Fed’s plan risks stalling the economy and causing a recession.
The employment market has remained a strong area of the economy, along with consumer spending. The latest government data showed that the number of Americans applying for unemployment benefits fell last week and remains historically low.
The healthy jobs market has been a tricky sticking point for the broader economy. While positive, it also signals that the Fed will have to remain aggressive in raising interest rates. Fed officials have warned that the unemployment rate will likely have to rise as part of their fight against rising prices.
The central bank has raised its key interest rate to a range of 3% to 3.25%. A little more than six months ago, that rate was near zero. The rate increases have been putting pressure on other areas of the economy, including the housing market.
The sharp rate increases have pushed mortgage rates up to 15-year highs. Mortgage buyer Freddie Mac reported Thursday that the average on the key 30-year rate ticked up this week to 6.94% from 6.92% last week. Last year at this time, the rate was 3.09%.
Higher mortgage rates are helping stall a housing sector that has been hot for years. The National Association of Realtors said Thursday that sales of previously occupied US homes fell in September for the eighth month in a row.
Homebuilders were broadly lower following the latest housing and mortgage rates reports. Pulte Group fell 1.2%.
Elaine Kurtenbach and Matt Ott contributed to this report.
Damian J. Troise And Alex Veiga, The Associated Press
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