US stocks trend down in mixed trading
NEW YORK — U.S. stocks are lower on Wednesday as the gas pedal eases in what has been a significant week so far on Wall Street.
The S&P 500 was down 0.3% in afternoon trading. The winning streak over the first two days of the week erased nearly two-thirds of last week’s heavy losses.
As of 12:17 p.m. ET, the Dow Jones Industrial Average was down 123 points, or 0.3%, and the Nasdaq Composite Index was down 0.2%.
Tesla Inc. jumped 9.7% last night after announcing it would accelerate production of new, more affordable cars, which investors hope will lead to faster growth. The announcement helped investors avoid Tesla’s reported 55% profit decline.
Tesla is the first of a group of stocks known as the Magnificent Seven to report results for early 2024. With Tesla driving much of the U.S. stock market’s rise last year, the focus is on a group of smaller stocks. It will need performance to justify the high price.
If companies want stock prices to rise, they will need to broadly increase their profits. That’s because they’re unlikely to get much help from interest rates, another way to boost stock prices.
In the bond market, U.S. Treasury yields rose after the latest report that the U.S. economy beat expectations, putting pressure on stock prices. A recent spate of such reports has dampened hopes that the U.S. Federal Reserve might cut interest rates three times this year, as it had previously suggested.
A report on Wednesday said orders for machinery, aircraft and other long-lived industrial products were stronger than expected last month. Wall Street is in the awkward position of hoping the economy avoids a painful recession, but not one that would maintain upward pressure on inflation and persuade the Fed not to cut interest rates.
The yield on the 10-year U.S. Treasury rose to 4.65% from 4.60% late Tuesday.
On Wall Street, shares fell 5% after rail operator Norfolk Southern reported lower-than-expected results for its latest quarter.
Bunge Global fell 3.2% after the oilseed processor reported better-than-expected profits for its latest quarter, but remained uncertain about how the business would perform into the second half of the year. “Prospects are limited,” he warned.
Teledyne Technologies fell 12.1%, the market’s biggest loss, after the maker of digital image sensors, cameras and other equipment reported lower-than-expected profits and revenue. The company said demand from the industrial automation and test and measurement markets was weaker than expected.
Among the market winners, toy and game company Hasbro soared 11.3% after reporting its latest quarter’s profit and revenue were better than analysts expected. It benefited from growth from Baldur Gate 3 and Magic: The Gathering games, as well as Peppa Pig content.
Rival Mattel Inc. rose 3.7% after the Barbie doll and Hot Wheels company reported a lighter loss in its latest quarter than analysts expected.
Boeing fell 1.4% despite reporting results that weren’t as bad as analysts had feared. The company, which is battling criticism over the safety of its planes, said it was taking steps to improve manufacturing quality, which has held up production.
In overseas stock markets, Japan’s Nikkei Stock Average rose 2.4% as the value of the Japanese yen continued to decline against the US dollar. The yen is trading at a 34-year low, a boost for Japan’s exporters, but speculation is also mounting about whether Japanese authorities will strengthen the currency.
Stock indexes rose across much of Asia and the rest of Europe.
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Associated Press writers Matt Ott and Zimo Zhong contributed.
