Stocks Turn Higher on Wall Street, Led by Big Tech Companies | Business News
By DAMIAN J. TROISE, AP Business Writer
NEW YORK (AP) — Stocks turned higher in late morning trading on Wall Street Tuesday as solid gains from big technology companies helped shake off an early loss.
The S&P 500 rose 0.4% as of 10:50 a.m. The Dow Jones Industrial Average gained 54 points, or 0.2%, to 32,972 and the Nasdaq climbed 0.7%.
Technology stocks did much of the market’s heavy lifting. Apple rose 1.2% and Microsoft added 1%.
Energy companies also made solid gains as oil prices ticked higher. The price of U.S. crude oil rose 1.1% and Exxon Mobil leaped 3%.
Retailers lagged the broader market. Target fell 1.3% after saying it’s cancelling orders from suppliers and slashing prices. The move comes as consumers shift spending from clothing and electronics to services like travel and dining out as pandemic fears abate.
Bond yields eased following Monday’s jump, which was fueled by persistent anxiety over a possible U.S. economic slowdown. The yield on the 10-year Treasury fell to 2.97% from 3.03% late Monday.
Earnings and deal news helped move several stocks. Kohl’s soared 11.5% after the department store chain said it’s in advanced talks to sell itself for about $8 billion to Vitamin Shoppe owner Franchise Group. Jam maker J.M. Smucker rose 4.9% after reporting strong earnings.
Markets have been choppy as investors try to determine how much damage rising inflation will inflict on the economy and whether rising interest rates will help or hurt the situation.
Businesses are raising prices on everything from food to clothing to offset inflation’s impact on their costs. Those higher prices have squeezed consumers, who are trimming their spending on high-priced items as they spend more on necessities like food.
Russia’s ongoing war on Ukraine has raised food and energy prices across the globe. Record-high gasoline prices have put an additional squeeze on consumers. U.S. crude oil prices are up 59% this year. The World Bank has sharply downgraded its outlook for the global economy, pointing to Russia’s war and concerns about the potential return of “stagflation,” a toxic mix of high inflation and sluggish growth unseen for more than four decades.
The Federal Reserve has responded by pivoting from a policy of maintaining low interest rates during the pandemic to aggressively raising interest rates to slow economic growth and temper the impact from inflation. The plan has raised concerns that the Fed could go too far too quickly and possibly tip the U.S. economy into a recession.
Worries about the aggressive rate hikes and inflation have weighed on markets. The benchmark S&P 500 index is coming off of its eighth losing week in the last nine. Big daily swings have become the norm for markets as investors review government data and corporate updates on inflation. They will receive another update on Friday when the U.S. releases its latest monthly update on consumer prices.
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