U.S. stocks closed lower on Wednesday on growing fears over inflation and supply chain concerns amid a slew of earnings reports from a batch of big-box retailers. However, all the indexes remained within striking distance of their all-time record closing highs, as technology stocks continued to drive the rally. All the three major indexes ended in negative territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) shed 0.6% or 211.17 points to close at 35,931.05 points.
The S&P 500 declined 0.3% or 12.23 points to finish at 4,688.67 points. Energy and financial stocks were the biggest losers. The Energy Select Sector SPDR (XLE) declined 1.5%, while the Financials Select Sector SPDR (XLF) lost 1.2%. Seven of the 11 sectors of the benchmark index ended in negative territory.
The tech-heavy Nasdaq slid 0.3% or 52.28 points to end at 15,921.57 points. Shares of Tesla, Inc.
TSLA
gained 3.3%. Tesla carries a Zacks Rank #2 (Buy). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
The fear-gauge CBOE Volatility Index (VIX) was up 2.46% to 15.39. A total of 10.6billion shares were traded on Wednesday, lower than the last 20-session average of 11.09 billion.
Inflation Worries Take a Toll on Stocks
Markets ended higher on Tuesday and started Wednesday on a high. All the three major indexes moved upward initially following robust quarterly results and some positive economic data released on Tuesday. However, growing concerns over inflation and a slight marginal retreat in Treasury yields on Wednesday weighed on the broader market.
That at the same time lifted large-cap tech stocks that rallied. Shares of Netflix, Inc.
NFLX
gained 0.6%, while Microsoft Corporation
MSFT
increased 0.1%.
Also, a large batch of retailers reported their quarterly results on Wednesday. With most reporting impressive results, investors’ sentiments got a boost. However, many have been also been reporting that rising costs are hurting margins, raising supply chain concerns.
However, even after Wednesday’s declined, the three indexes are well within striking distance of the record closing highs.
Economic Data
Not much economic data was released on Wednesday. The Commerce Department said that U.S. housing starts fell 0.7% to a seasonally adjusted annual rate of 1.520 million units on October. However, building permits jumped 4% to a rate of 1.650 million units in October.
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