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Wall Street dips, S&P falls

NEW YORK (AP) — Sinking technology stocks sent Wall Street lower again on Wednesday, and the S&P 500 fell to its fourth straight loss.

The index dipped 29.20 points, or 0.6 per cent, to 5,022.21 for its longest losing streak since early January. It’s down 4.4 per cent since setting a record late last month.

The Dow Jones Industrial Average slipped 45.66 points, or 0.1 per cent, to 37,753.31, and the Nasdaq composite sank 181.88, or 1.1 per cent, to 15,683.37.

Tech stocks slumped after ASML, a Dutch company that’s a major supplier to the semiconductor industry, reported weaker orders for the start of 2024 than analysts expected. Its stock trading in the United States slumped 7.1 per cent.

Nvidia dropped 3.9 per cent, and Broadcom sank 3.5 per cent to serve as the two heaviest weights on the S&P 500.

The weakness for tech overshadowed stronger-than-expected profit reports from some big companies, including United Airlines. It soared 17.4 per cent after reporting stronger results for the start of the year than analysts expected, lifted by strong demand from business fliers.

The losses also came despite easing pressure from the bond market, which has been dictating much of Wall Street’s action lately. Sharp tumbles for oil prices lessened investors’ worries about inflation, which in turn helped Treasury yields ease.

The 10-year Treasury yield sank to 4.58 per cent from 4.67 per cent late Tuesday. The two-year yield, which moves more closely with expectations for the Fed, fell to 4.92 per cent from 4.99 per cent.

They gave back some of their big recent gains driven by traders giving up on hopes for imminent cuts to interest rates by the Federal Reserve.

Yields on Tuesday had returned to where they were in November after top officials at the Federal Reserve suggested the central bank may hold its main interest steady for a while. It wants to get more confidence that inflation is sustainably heading toward its target of 2 per cent. Its main interest rate has been sitting at its highest level since 2001.

High interest rates hurt prices for investments and increase the risk of a recession, but Fed officials are concerned after a string of reports this year has shown inflation remaining hotter than forecast.

Traders are now mostly expecting just one or two cuts to interest rates from the Federal Reserve this year, according to data from CME Group. That’s down from forecasts for six or more at the start of the year.

With little near-term help expected from an easing of interest rates, companies will need to deliver fatter profits to justify their big runs in stock price since autumn.

“I think markets are waiting on corporate news to decide where they’ll head next,” said JJ Kinahan, CEO of IG North America.

Travellers slumped 7.4 per cent after the insurer’s quarterly results fell short of forecasts. It had to contend with more losses from catastrophes.

J.B. Hunt Transport Services fell 8.1 per cent after reporting weaker revenue and results than expected. It was hurt in part by competition in the eastern part of the country and by higher wages for workers and other costs.

On the winning side of Wall Street was Omnicom Group. It rose 1.6 per cent after reporting stronger profit for the latest quarter than analysts expected. The marketing and communications company highlighted growth trends in most markets around the world, outside the Middle East and Africa.

The stock of Donald Trump’s social media company also continued to swing sharply, this time jumping 15.6 per cent. That followed two straight losses of more than 14 per cent. Experts say the stock is caught up in frenzied trading driven more by public sentiment around the former president than by the business prospects of the company.

In stock markets abroad, London’s FTSE 100 added 0.4 per cent after a report showed U.K. inflation fell to its lowest level in two and a half years in March. That could further pave the way for a cut in interest rates there.

Other indexes rose modestly in Europe, while they were mixed in Asia. Japan’s Nikkei 225 fell 1.3 per cent, while stocks jumped 2.1 per cent in Shanghai.

People pass the New York Stock Exchange, right, on Wednesday, April 17, 2024 in New York. PHOTO: AP
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