NEW YORK — Stocks are drifting between small losses and gains on Wall Street Wednesday, as the S&P 500 follows up its return to a record high with another day of meandering trading.
The S&P 500 was down 0.1%, after flipping from an earlier gain of 0.3%, a day after it wiped out the last of its losses created by the pandemic and surpassed its Feb. 19 peak.
The Dow Jones Industrial Average was up a single point point at 27,779, as of 2:40 p.m. Eastern time, and the Nasdaq composite was 0.2% lower.
The market’s momentum has remained solid, but it’s slowed recently after roaring back from a terrifying plummet of nearly 34% in February and March. Trading has been so tepid that it took the S&P 500 several attempts to break its record after pulling within 1% of the mark a week and a half ago.
“The elevator went down very quickly, so to speak,” Nancy Davis, chief investment officer of Quadratic Capital, said of the market’s plunge earlier this year. “And now we’ve been climbing the stairs back up, and we’re higher than we were before.”
Indexes slipped a bit in the afternoon after the Federal Reserve released the minutes from its last policy meeting. The central bank has been one of the main pillars propping up the market after it slashed short-term interest rates to their record low and essentially promised to buy as many bonds as it takes to keep markets running smoothly.
The Fed’s minutes showed again that policy makers are finding it very difficult to forecast the path of the economy, which will depend greatly on what happens with the virus.
The economy is showing some signs of improvement, but not enough to get the Fed to pull back on its aid for the economy. At least, that’s the fervent hope for investors, because low interest rates can act like rocket fuel for markets.
The yield on the 10-year Treasury held steady at 0.67%, after rallying back from 0.64% earlier in the morning.
This is a traditionally slow time of the year for stocks, and the market is also still in wait-and-see mode on several fronts.
Investors still seem to believe that Congress and the White House will reach a deal to deliver more aid to the economy after federal unemployment benefits and other stimulus expired. Democrats and Republicans have been stuck at an impasse and sniping back and forth, but a GOP senator said Tuesday that Senate Republican leaders are preparing a slimmed-down coronavirus relief package. House Speaker Nancy Pelosi also told fellow Democrats she’d continue seeking a broader economic relief bill.
Beyond Capitol Hill, investors are also waiting for more developments on the rising tensions between the United States and China. The world’s largest economies have longstanding trade issues, and President Donald Trump has recently been targeting Chinese tech companies in particular. Trump said Tuesday that he postponed trade talks with China scheduled for last weekend because “I don’t want to deal with them right now.”
Also hanging over the market is the upcoming U.S. election, with the big changes in tax and other policies that it can create. Democrats formally nominated Joe Biden late Tuesday to run against Trump for the White House in November’s election.
Earnings reporting season for big U.S companies has nearly wrapped up, with businesses in the S&P 500 on track to report a sharp decline in their profits for the spring, but not as bad as Wall Street expected. More than 93% of the earnings reports are in, and the index is on pace for a roughly 33% drop from the prior year.
Target jumped 12.8% for the biggest gain in the S&P 500 after it reported results for the spring that easily beat Wall Street’s expectations.
But TJX, the operator of T.J. Maxx and Marshalls, slumped 5.8% after its results fell short of analysts’ forecasts.
Apple continued its run of dominance and rose 0.8%. Earlier in the day, its total market value briefly topped $2 trillion, the first time a U.S. company has crossed that threshold. Apple’s stock has soared nearly 60% this year, despite the pandemic, as loyal customers snap up its products even if they can’t go to a store to test them out.
The continued rise of Big Tech companies has been a big reason for the S&P 500’s record run. Profits have remained strong for them as the pandemic accelerates work-from-home and other trends that help their sales. But that has critics calling tech stocks the brightest examples of a stock market were prices have shot too high, even after accounting for their bonanza profits.
Analysts across Wall Street also say they want to see price gains spread more widely outside of tech, which would be the sign of a healthier market.
“It’s important for investors to take a step back and say, ‘Look, does it make sense that Zoom is bigger than every single airline in the world?” said Davis.
In European stock markets, the German DAX returned 0.7%. The French CAC 40 rose 0.8%, and the FTSE 100 in London added 0.6%.
In Asia, Japan’s Nikkei 225 rose 0.3%, and South Korea’s Kospi gained 0.5%. Stocks in Shanghai slumped 1.2%, and the Hang Seng in Hong Kong lost 0.7%.
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AP Business Writer Elaine Kurtenbach contributed.
Stan Choe And Damian J. Troise, The Associated Press
