NEW YORK (AP) – Stocks fell and bond yields rose on Wall Street on Thursday as investors reviewed the latest economic data and corporate earnings amid ongoing concerns about inflation and rising interest rates.
The S&P 500 was down 1% as of 3:44 p.m. ET, on course for its second straight weekly loss. The Dow Jones Industrial Average fell 16 points, or 0.1%, to 34,538 and the Nasdaq fell 1.9%.
Technology stocks led lower, offsetting gains elsewhere in the market. Expensive valuations for many of the larger tech companies give them more leverage to steer the broader market up or down. Microsoft fell 2.4%.
Retailers and other businesses that rely on consumer spending also weighed on the market. Amazon fell 2.5%. Energy stocks rose in tandem with crude oil prices. ExxonMobil rose 1.5%.
The selling amid higher oil prices and rising bond yields suggests investors remain concerned about inflation, the war in Ukraine and the Federal Reserve’s moves to raise interest rates, said Sam Stovall, chief investment strategist at CFRA.
With the US stock market closed on Good Friday, traders are also keen to minimize risk.
“It’s a long weekend that people don’t want to be overly exposed to,” Stovall said.
Investors once again turned their attention to the drama surrounding Tesla founder and CEO Elon Musk and Twitter. Musk offered to buy the social media company for $54.20 a share, two weeks after announcing he had acquired a 9% stake.
Musk has criticized Twitter for not upholding free speech principles and said in a regulatory filing that it needs to be turned into a private company. Twitter stock fell 1.9% to $44.96, well below Musk’s bid price.
Wall Street had mixed economic data to review earlier in the week after several hot inflation reports. The Commerce Department said retail sales rose 0.5% in March, boosted by higher gasoline prices as consumers continue to spend despite high inflation.
With US inflation remaining at its highest level in 40 years, economists and analysts are closely watching how consumers react to higher food, clothing and gas prices. Inflation concerns have been exacerbated by the Russian invasion of Ukraine, leading to more volatile energy prices and contributing to rising oil and wheat prices around the world.
US crude prices reversed an early decline on Thursday and settled 2.6% higher.
The head of the International Monetary Fund warned Thursday that Russia’s war in Ukraine is weakening the economic outlook for most countries around the world, reiterating the danger high inflation poses to the global economy.
Rising prices are driving the Federal Reserve and many other central banks to tighten monetary policy, including raising interest rates to cool the rising demand that is contributing to the problem.
Bond yields have mostly risen as Wall Street prepares for higher interest rates. The yield on the 10-year government bond rose to 2.83% from 2.72% late Wednesday.
Investors received another update on the labor market recovery. The number of people applying for unemployment benefits has increased over the past week, according to the Labor Department, but has remained at historically low levels. The data reflects a robust US job market with near-record job openings and few layoffs.
Earnings season is underway and reports from insurer UnitedHealth Group and several banks were released on Thursday.
UnitedHealth rose 0.1% after reporting solid first-quarter results and raising its 2022 guidance.
Investors had a mixed reaction to results from four of the country’s largest banks, all of which reported a notable fall in their first-quarter profits as volatile markets and the war in Ukraine caused business to dry up, while a slowdown in the economy Housing market meant fewer people were looking for mortgages.
Citigroup rose 1.9% while Wells Fargo fell 4.2%. Morgan Stanley rose 1% and Goldman Sachs was flat.
Investors are watching the latest round of corporate earnings closely to see how companies have dealt with rising costs and whether consumers have cut back on spending.
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Veiga reported from Los Angeles.