Stocks are falling today as Wall Street loses more momentum following its strong run so far this year, the Associated Press reports.
The S&P 500 was 0.7% lower in early trading, on track for a second straight losing day after hitting a 16-month high. The Dow Jones Industrial Average was down 128 points, or 0.4%, as of 9:45 a.m. Eastern time, and the Nasdaq composite was 1.2% lower.
Yields were mixed in the bond market after Fitch Ratings cut the credit rating of the U.S. government. One of the reasons was the repeated standoffs in Congress about whether to default on the U.S. debt. The downgrade strikes at the core of the global financial system because U.S. Treasurys are considered some of the safest possible investments on Earth.
In the bond market, the yield on the 10-year U.S. Treasury rose to 4.08% from 4.04% late Tuesday. It helps set rates for mortgages and other important loans. The two-year U.S. Treasury yield fell to 4.89% from 4.91% after its price rose.
The big issues for Wall Street remain whether the economy can avoid a long-predicted recession and what’s happening with corporate profits.
A report released today suggested hiring slowed last month by employers outside the government but that it still was much stronger than economists expected. The stronger-than-expected report from ADP could be a signal of what Friday’s more comprehensive jobs report from the U.S. government will say. That upcoming report is one that Fed Chair Jerome Powell has highlighted as a key datapoint before the central bank decides its next move in September.
Higher rates tend to hurt technology and other high-growth stocks in particular, and several Big Tech stocks helped pull the market lower. Nvidia, Amazon, and Meta all fell at least 2% and were some of the heaviest weights on the S&P 500.
Generac Holdings, which sells generators and other power products, tumbled 13.6% for one of the biggest drops in the S&P 500 after it reported weaker profit for the spring than analysts expected.
Most companies this reporting season, though, have been topping profit expectations. On the winning side of Wall Street was CVS Health, which rose 2% and beat expectations, even as profits sank.
