NEW YORK (AP) — Stocks fell in midday trading on Wall Street Tuesday as markets remain turbulent amid a busy week of earnings from some of the nation’s biggest companies.
The S&P 500 fell 1.9% as of 11:45 a.m. Eastern. The Dow Jones Industrial Average fell 508 points, or 1.5%, to 33,534 and the Nasdaq fell 3%.
The weak opening follows a similar start on Monday that turned into a late rally, partially led by technology stocks after Twitter agreed to sell itself to Tesla CEO Elon Musk. The social media company fell 3.2% Tuesday.
Technology stocks were once again directing the broader market and had some of the biggest losses. Companies in the sector, with their pricey values, tend to push the market up or down more forcefully. Microsoft fell 2.9% and Apple shed 2.6%. Both companies will report their latest financial results later Tuesday.
Retailers and other companies that rely on direct consumer spending also fell broadly. General Motors, which also reports its latest results later Tuesday, slipped 4.1%. Tesla slumped 9.6% and Nike fell 4.2%.
General Electric fell 11.8% for one of the sharpest losses on the market after telling investors that inflation and other pressures are weighing on its profit forecast for the year.
Bond yields fell sharply. The yield on the 10-year Treasury fell to 2.74% from 2.82% late Monday.
Energy companies gained ground along with a 2.6% rise in U.S. crude oil prices. Valero Energy rose 5.3%.
Stocks have been shaky recently, with the S&P 500 coming off a three-week losing streak.
“It’s the market getting a little more comfortable with a slowdown at best and recessionary fears at worst,” said Ross Mayfield, investment strategy analyst at Baird.
The last few days have been volatile as Wall Street also tries to assess how China’s strict lockdown measures to fight COVID-19 will impact the broader global economy, including hurting demand in the world’s second-largest economy. It could be prompting a resetting of expectations while Wall Street is also still focused on the Federal Reserve’s plan to raise its benchmark interest rates this year.
“The market had gotten comfortable, to an extent, with the Fed, but when you layer on demand destruction in China, it’s a little much for the market to stomach,” Mayfield said.
Earnings remain a key focus of Wall Street for the rest of the week. Airplane maker Boeing reports its results on Wednesday, along with Facebook parent, Meta. Industrial bellwether Caterpillar reports its results on Thursday, along with McDonald’s and Amazon.
Investors are closely reviewing the latest round of corporate report cards to get a better sense of how different industries are handling rising inflation, which has prompted many companies to raise prices. The results will also give a clearer picture of how consumers are reacting to higher prices on everything from food to clothing and gasoline.
The latest report from business research group The Conference Board revealed that consumer confidence dampened slightly in April but remains high. Investors on Friday will get more details on consumer spending when the Commerce Department releases its personal income and spending report for March.
Persistently rising inflation has prompted the Fed to shift its monetary policy in order to aggressively fight inflation. The chair of the Fed has indicated the central bank may hike short-term interest rates by double the usual amount at upcoming meetings, starting next week. It has already raised its key overnight rate once, the first such increase since 2018.
Economists and investors are concerned that the U.S. economy might slow sharply or even fall into a recession because of the big interest-rate increases the Fed is expected to push through.