NATIONAL NEWS

Stocks end lower on Wall Street after another volatile day

Jan 25, 2022, 3:20 PM | Updated: Jun 13, 2022, 3:41 pm

Traders work on the floor of the New York Stock Exchange (NYSE) on January 24, 2022 in New York Cit...

Traders work on the floor of the New York Stock Exchange (NYSE) on January 24, 2022 in New York City. Stocks fell again on Monday as inflation fears, rising oil prices and continued tensions with Russia added to economic worries for global markets. (Photo by Spencer Platt/Getty Images)

(Photo by Spencer Platt/Getty Images)

Another volatile bout of trading on Wall Street ended with a broad pullback for stocks Tuesday, as investors grapple with economic red flags and uncertainty over how aggressive the Federal Reserve will be in fighting rising inflation.

Stock indexes fell sharply to start the day, then came well off their lows by late afternoon. Another burst of selling in the final hour of trading pulled them lower again. Technology stocks were the biggest drag on the market.

The S&P 500 fell 1.2% after having been down as much as 2.8%. The benchmark index has been falling steadily all month and is now down 9.2% from the all-time high it set Jan. 3. The Dow Jones Industrial Average slipped 0.2% and the tech-heavy Nasdaq gave up 2.3%.

Higher inflation has been squeezing businesses and consumers, and the Federal Reserve is expected to combat it in 2022 by raising interest rates. Investors fear that the Fed could either be moving too late or could be too aggressive. The central bank issues its latest policy statement Wednesday.

The virus pandemic still hovers over the economy and threatens to crimp progress with every new wave. The International Monetary Fund cited the omicron variant as the reason it has downgraded its forecast for global economic growth this year.

And a potential conflict between Russia and Ukraine threatens to push energy prices even higher while forcing more countries to focus on fighting a war instead of inflation and COVID-19.

Wall Street is dealing with signs of slowing economic growth because of COVID-19 and a Fed that can’t really go back on what it said it would do, said Barry Bannister, chief equity strategist at Stifel.

“The market has come to terms with that and that’s a big deal,” he said. “Fiscal and monetary tightening, together, is tough on financial assets when they’re coming off of a rip-roaring party from stimulus.”

Still, the fact that the major stock indexes came off their lows of the day could be a sign that some investors are betting that a dimmer outlook for economic growth may prompt the Fed to take a more measured approach to raising interest rates.

“Weaker economic growth projections have contributed to investors breathing a sigh of relief that the Fed won’t have to be overly aggressive,” said Sam Stovall, chief investment strategist at CFRA.

The S&P 500 fell 53.68 points to 4,356.45. This week, the index has come within striking distance of entering a “correction,” which among markets watchers means a drop of 10% from a peak.

The Dow fell 66.77 points to 34,297.73. The blue-chip index had been down 818 points in morning trading.

The Nasdaq fell 315.83 points to 13,539.29. The index had initially slumped 3.2%. It entered a correction last week and is now down more than 15% from its high set on Nov. 19.

Small company stocks also lost ground. The Russell 2000 index fell 29.48 points, or 1.5%, to 2,004.03.

Major indexes had a similar start to trading on Monday and were down most of the day before a late buying spree pushed them to a higher close. That rebound may have been just a “head fake,” Bannister said, adding that more declines are likely in store for the market.

Even though the S&P 500 managed to eke out a gain after its roller-coaster ride on Monday, a measure of nervousness on Wall Street known as the VIX index remained high. That suggests stress is continuing to grow in the system, with markets in a “high speed spin cycle,” strategists at UBS wrote in a report.

Futures contracts related to the VIX, meanwhile, indicate investors are preparing for a high level of volatility in the near term but less in ensuing months. That’s a flip from their typical behavior last year.

Technology stocks again led the losses as investors worry about rising interest rates. Higher interest rates tend to make shares in high-flying tech companies and other expensive growth stocks less attractive. Microsoft fell 2.7%.

Retailers and communications companies also fell. Home Depot fell 1.3% and Netflix fell 5.4%. U.S. crude oil prices rose 2.7% and helped send energy stocks higher. Occidental Petroleum jumped 8.1%.

American Express surged 8.9% for the biggest gain in the S&P 500 after the credit card company reported that its fourth-quarter earnings rose 20% from a year earlier.

Bond yields rose. The yield on the 10-year Treasury rose to 1.78% from 1.74% late Monday.

_____

Associated Press Business Writer Stan Choe contributed.

KSL 5 TV Live

National News

A paddle boarder tows an inflatable unicorn on a temporary lake in Death Valley on Thursday, Feb. 2...

Ty O'Neil, John Locher and Stefanie Dazio

Kayakers paddle in Death Valley after rains replenish lake in one of Earth’s driest spots

Kayakers have been paddling in one of the driest places on Earth after a series of storms battered California’s Death Valley and replenished Lake Manly.

1 hour ago

(Photo by Tomohiro Ohsumi/Getty Images)...

Associated Press

Toyota recalls 280,000 pickups and SUVs because transmissions can deliver power even when in neutral

The recall is to fix a transmission problem that can let the vehicles creep forward while in neutral.

15 hours ago

The defendants are accused of stealing software used to train Apache helicopter pilots....

Haley Britzky and Sharif Paget, CNN

2 National Guardsmen killed after military helicopter crash in Mississippi

Two National Guard members died after a helicopter crashed Friday afternoon during a training flight in northeast Mississippi.

17 hours ago

FILE - In this Tuesday, Oct. 2, 2018 photo, containers holding frozen embryos and sperm are stored ...

Associated Press

Facing backlash over IVF ruling, Alabama lawmakers look for a fix

Lawmakers began scrambling for ways to protect Alabama in vitro fertilization services after multiple providers paused services in the wake of a state Supreme Court ruling that frozen embryos could be considered children under a state law.

21 hours ago

Beguiling Joshua trees and intriguing rock formations helped draw millions of vistoris to Joshua Tr...

Forrest Brown, CNN

The most visited National Park Service sites in 2023 are …

See what Utah National Park proved to be the most popular in 2023.

22 hours ago

FILE - The residence where a former funeral home owner kept a deceased women's body in a hearse for...

Associated Press

A former funeral home owner has been arrested after a corpse lay in a hearse for 2 years

A former funeral home owner accused of hiding a woman's corpse in the back of a hearse for two years and hoarding the cremated remains of at least 30 people has been arrested, authorities said.

23 hours ago

Sponsored Articles

Modern chandelier hanging from a white slanted ceiling with windows in the backgruond...

Lighting Design

Light Up Your Home With These Top Lighting Trends for 2024

Check out the latest lighting design trends for 2024 and tips on how you can incorporate them into your home.

Technician woman fixing hardware of desktop computer. Close up....

PC Laptops

Tips for Hassle-Free Computer Repairs

Experiencing a glitch in your computer can be frustrating, but with these tips you can have your computer repaired without the stress.

Close up of finger on keyboard button with number 11 logo...

PC Laptops

7 Reasons Why You Should Upgrade Your Laptop to Windows 11

Explore the benefits of upgrading to Windows 11 for a smoother, more secure, and feature-packed computing experience.

Stylish room interior with beautiful Christmas tree and decorative fireplace...

Lighting Design

Create a Festive Home with Our Easy-to-Follow Holiday Prep Guide

Get ready for festive celebrations! Discover expert tips to prepare your home for the holidays, creating a warm and welcoming atmosphere for unforgettable moments.

Battery low message on mobile device screen. Internet and technology concept...

PC Laptops

9 Tips to Get More Power Out of Your Laptop Battery

Get more power out of your laptop battery and help it last longer by implementing some of these tips from our guide.

Users display warnings about the use of artificial intelligence (AI), access to malicious software ...

Les Olson

How to Stay Safe from Cybersecurity Threats

Read our tips for reading for how to respond to rising cybersecurity threats in 2023 and beyond to keep yourself and your company safe.

Stocks end lower on Wall Street after another volatile day