By DAMIAN J. TROISE and ALEX VEIGA
Stocks ended modestly lower on Wall Street Monday after giving up an early gain and bouncing around for much of the day. The indecisive trading came a day after the market posted its best week since November 2020 and as the chair of the Federal Reserve said the central bank was prepared to move more aggressively if need be to contain inflation. The S&P 500 slipped less than 0.1%, the Dow Jones Industrial Average fell 0.6% and the Nasdaq fell 0.4%. Bond yields rose significantly. Crude oil prices rose just over 7%. Media ratings agency Nielsen sank 6.9% after rejecting an acquisition offer.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Stocks fell on Wall Street in afternoon trading Monday, giving back some of their recent gains after the major indexes notched their best week since November 2020.
The S&P 500 was 0.3% lower as of 3:34 p.m. Eastern after spending much of the morning shifting between small gains and losses. The Dow Jones Industrial Average fell 282 points, or 0.8%, to 34,469 and the Nasdaq fell 0.7%.
The pullback came after Fed Chair Jerome Powell said the central bank would be open to raising rates by a half-point at multiple Fed meetings, if necessary. The Fed, which last week announced a quarter-point rate hike marking its first interest rate increase since 2018, hasn’t raised its benchmark rate by a half-point since May 2000.
The remarks, which Powell delivered in a speech to the National Association for Business Economists, follow the Fed’s interest rate and economic policy statement last Wednesday. Stocks rallied on their way to their best week in more than a year after the Fed announced the widely expected resumption of rate hikes last week as it tries to tame rising inflation. The central bank is expected to raise rates several more times this year.
Bond yields rose sharply. The yield on the 10-year Treasury jumped to 2.32% from 2.14% late Friday.
Big technology stocks were the biggest drag on the market. Microsoft fell 1.3% and Broadcom slid 2%.
Communication stocks, retailers and other companies that rely on consumer spending also weighed on the market. Facebook parent, Meta Platforms, fell 3%, while Home Depot slid 3.6%.
Energy stocks made solid gains as oil prices gained ground. U.S. benchmark crude oil jumped 7.1% to settle at $112.12 per barrel, while Brent, the international standard, climbed 7.1% to settle at $115.62. Exxon Mobil gained 4.6%.
Investors face a fairly quiet week without much economic data to give them a better sense of how companies and investors are dealing with rising inflation.
The Fed’s move to raise interest rates had been expected for months as supply chain problems brought on by surging demand pushed prices of everything from food to clothing higher. That has raised concerns that consumers might eventually curtail some spending, which could prompt a more severe economic slowdown than analysts anticipate.
Russia’s invasion of Ukraine added to concerns that inflation could worsen by pushing energy and commodity prices higher. Oil prices are up more than 45% this year and prices for wheat and corn have also surged.
Outside of those broader concerns, several stocks made big moves on company-specific news. Alleghany, a reinsurance company, soared about 25% after agreeing to be bought by Warren Buffett’s Berkshire Hathaway. Media ratings agency Nielsen slid 7.4% after rejecting an acquisition offer.
Boeing fell 3.6% after one of its planes crashed in China with 132 people on board.
Markets in Europe were mixed. The FTSE 100 in London rose 0.5%, the DAX in Frankfurt fell 0.6% and the CAC 40 in Paris fell 0.6%. In Asia, the Shanghai Composite Index gained less than 0.1% and the Hang Seng in Hong Kong fell 0.9%. Japanese markets were closed for a holiday.
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