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Market Snapshot: Dow, S&P 500 eke out gains but Nasdaq slips after booking biggest dive since 2020

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U.S. stocks were trading modestly higher Wednesday afternoon, with investors sizing up a mixed batch of results from Boeing Co., Microsoft Corp. and Alphabet Inc. among others, a day after the Nasdaq Composite’s lowest finish in more than two years.

How are stock indexes trading?

The Dow Jones Industrial Average
DJIA,
+1.02%

rose 321 points, or 1%, to 33,561.

The S&P 500
SPX,
+1.14%

jumped 41 points, or 1%, to 4,216.

The Nasdaq Composite
COMP,
+0.95%

advanced 108 points, or 0.9%, to trade at 12,601.

On Tuesday, the Dow industrials tumbled more than 800 points, or 2.4%. The S&P 500 fell 2.8%, while the Nasdaq Composite slid 4%, booking its largest daily percentage drop since Sept. 8, 2020 and its lowest close since Dec. 14, 2020, according to Dow Jones Market Data.

What’s driving markets?

Stocks aim for a bounce Wednesday after several days of sharp losses, even as investors juggle several concerns at once, including fears the Federal Reserve could knock the economy into recession as it raises interest rates to battle high inflation, mixed U.S. corporate earnings and worries about China’s COVID outbreak, which is slowing economic growth.

Investors also were keeping watch on tensions surrounding the war in Ukraine, with signs of escalation after Russia’s Gazprom said Wednesday that it is halting gas deliveries to Bulgaria and Poland due to a failure by those countries to pay in rubles.

At the same time, several major factors rattling stocks have been percolating for a while, said Robert Pavlik, senior portfolio manager at Dakota Wealth Management, by phone, speaking to recently aggressive tones from the Fed about fighting inflation and lockdowns in China.

“If you look at the big picture, nothing is really new,” Pavlik said, adding that “some companies have missed or provided cautious guidance.” However, he also thinks equities probably were oversold in the past two days. “It was poised for a bounce,” he said. “Whether or not it lasts is the question.”

Microsoft
MSFT,
+6.58%

shares rose 6.7% after the tech giant late Tuesday reported profit and sales estimates that beat forecasts.

But Google parent Alphabet
GOOGL,
-2.72%

reported sales and earnings that came in short of estimates, and shares fell 2.4%.

Another big decliner was Boeing
BA,
-9.54%
,
with shares of the aerospace and defense giant dropping toward a 17-month low after much wider-than-expected loss and a big revenue miss.

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“Either way, tech and high beta areas of the equity market need to find some inspiration, or a further liquidation can’t be ruled out — at the moment it feels like catching a falling knife,” said Chris Weston, head of research at Pepperstone, in a note to clients.” The S&P 500’s growth sector was down 3.7% Wednesday, bucking the broader trend of a bounce for stocks.

“Again, we ask what will [be] the circuit breaker to promote a lasting trend higher. My own view is it either comes from a belief that China has COVID under control or we hear a Fed member saying ‘inflation is a concern but we’re watching for signs that growth concerns or financial conditions overtighten,’” said Weston.

The U.S. trade deficit in goods jumped 17.8% in March to a record $125.3 billion, government data showed. A home-price index is due later Wednesday morning.

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What companies are in focus?

Tesla Inc.
TSLA,
+2.40%

shares were up about 3% Wednesday, recouping some of its 12.8% decline a day earlier that subtracted $126 billion from its market cap this week.

General Motors Co.
GM,
+1.93%

shares rose 2.5% after the auto maker reported disappointing first-quarter revenue, but gave upbeat guidance.

Stock in Texas Instruments Inc.
TXN,
+1.70%

rose 1.4% after the chip maker gave a cautious outlook over COVID-19 restrictions in China affecting manufacturing for its customers.

Robinhood Markets Inc.
HOOD,
-4.45%

fell 4.3%. The online-trading platform’s chief executive, Vlad Tenev, announced a 9% cut in the company’s work force.

Mattel Inc.
MAT,
+11.62%

shares surged nearly 12% after The Wall Street Journal reported the toy maker has held informal talks with private-equity firms Apollo Global Management and L Catterton about being purchased.

How are other assets trading?

The yield on the 10-year Treasury note 
TMUBMUSD10Y,
2.794%

 rose 1 basis points to 2.79%. Yields and debt prices move opposite each other.

Oil futures gave up early gains, with the U.S. benchmark
CL.1,
-0.55%

down 0.9% to trade just above $100 a barrel.

The ICE U.S. Dollar Index 
DXY,
+0.54%
,
 a measure of the currency against a basket of six major rivals, was up 0.5%, hitting its highest since March 2020.

Bitcoin 
BTCUSD,
+2.50%

rose 2.5% to trade near $39,200.

Gold for June delivery 
GC00,
-0.69%

GCM22,
-0.69%

fell below $1,900 an ounce to trade at a two-month low.

In European equities, the Stoxx Europe 600 
SXXP,
+0.73%

rose 0.7% and London’s FTSE 100 
UKX,
+0.53%

gained 0.5%.

In Asia, the Shanghai Composite
SHCOMP,
+2.49%

rose 2.4%, while the Hang Seng Index HSI, +0.06% finished flat in Hong Kong and Japan’s Nikkei 225 
NIK,
-1.17%

fell 1.2%.

–Barbara Kollmeyer contributed reporting to this article.

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